AGO 1991 No. 15 - Mar 29 1991
COMMUNITY COLLEGES ‑- SALARIES AND WAGES ‑- COMPENSATION ‑- AUTOMOBILES ‑- REIMBURSEMENT OF TRANSPORTATION EXPENSES
1. Prior to its amendment in 1990, RCW 28B.50.140(3) empowered a community college board of trustees to fix the salary and duties of community college presidents. RCW 28B.50.140(3) only empowered the board to pay salary. Payments to reimburse a president for the president's transportation expenses did not constitute salary and were not authorized under RCW 28B.50.140(3).
2. In 1990 RCW 28B.50.140(3) was amended. Laws of 1990, ch. 135, § 1, p. 926. Amended RCW 28B.50.140(3) authorizes a community college board of trustees to fix the compensation and duties of community college presidents. Payments to reimburse a president for the president's transportation expenses are not authorized as compensation since RCW 43.03.060(1) provides the procedure to reimburse state employees for travel expenses. RCW 28B.50.140(3) does not authorize the board to supplant this reimbursement system.
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March 29, 1991
Karen Clarke, Chair
Board of Trustees
Tacoma Community College
Community College District 22
5900 South 12th Street
Tacoma, Washington 98465
Cite as: AGO 1991 No. 15
Dear Ms. Clarke:
By letter previously acknowledged, you asked a question that we paraphrase as follows:
May a community college board of trustees pay the college president a fixed stipend in excess of his salary to reimburse the president for the cost and expenses of keeping a personally owned vehicle available at all times for official use?
[[Orig. Op. Page 2]]
The answer to your question is no.
One of the duties of a community college board of trustees is to employ a college president. Prior to March 22, 1990, RCW 28B.50.140(3) provided1/
that the board shall
employ for a period to be fixed by the board a college president for each community college . . . and other employees as may be necessary or appropriate and fix their salaries and duties. Salary increases shall not exceed the amount or percentage established in the state appropriations act by the legislature as allocated to the board of trustees by the state board for community college education;
. . . .
Your question concerns the interpretation of this statute.
By resolution on July 1, 1988, the Board of Trustees approved the following addendum to the employment contract of the president of Community College District 22:
The President shall supervise all College operations on a 24 hours per day, 7 days per week basis. The College has no vehicle available to the President to enable him to carry out his duties. The President therefore agrees to own, maintain and operate a private motor vehicle for use in meeting College emergencies and in carrying out his duties as President. Such vehicle shall be available 24 hours per day and 7 days per week. The College shall reimburse the President for the costs and expenses related thereto and the value received by the College. It is difficult to determine the precise dollar amounts of such items. The College and the President have determined that such items would total in excess of $6,000 per year if provided directly by the College. The parties therefore agree that the College shall reimburse the President $500 per month toward such costs and expenses.
[[Orig. Op. Page 3]]
The purpose of this addendum is not completely clear. On one hand, it might be characterized as an agreement to pay the president for taking on an additional obligation‑-that of supervising the affairs of the college 24 hours a day, seven days a week, and promising to maintain a vehicle for that purpose. On the other hand, the language of the addendum characterizes the payments as reimbursement of costs and expenses incurred by the president.
RCW 28B.50.140(3) clearly gave the board the authority to set the duties and salary of the president. If the addendum constituted salary for services, it was within the board's power to make the payment, so long as it was within state appropriation allocated to the college. However, it is our understanding that the $6,000 payment contemplated by the addendum fell outside of this limit. If the $6,000 payment did fall outside the appropriation limit, RCW 28B.50.140(3) prohibited the payment.
For this reason we conclude that the addendum was not intended to be salary paid to the president for duties performed. We believe the correct characterization is that the payment was intended to reimburse the president for transportation expenses that the president incurred on behalf of the college. The question is whether, in addition to paying salary, the board had the power to establish a system to reimburse the president for his transportation expenses on a basis different from other state employees.
Community College District 22 is a state agency created by statute and as such has only those powers expressly given it by statute or necessarily implied therefrom. See Human Rights Comm'n v. Cheney School Dist., 97 Wn.2d 118, 125, 641 P.2d 163 (1982). Therefore, it is necessary to examine whether the district's board of trustees is authorized by statute to establish a payment system to reimburse the college president for transportation expenses.
Under RCW 28B.50.140(3), as it existed when your question was posed, the community college boards of trustees were authorized to fix the "salaries and duties" ‑ but not the "compensation" ‑ of college presidents. Thus, under the law as it stood until last year, community college boards could pay presidents a salary and whatever benefits were mandated by legislation, but could not provide for additional "compensation".
In formal opinions, this office long ago drew a distinction between the terms "salary" and "compensation" as used by the Legislature. In AGO 1974 No. 15, "salary" was found to be the narrower term, including only the money paid to employees at fixed intervals. "Compensation" was defined more expansively to [[Orig. Op. Page 4]] include the full range of employee benefits including both salary and other elements. The Legislature, not having disturbed this opinion, may be presumed to have accepted it, and in fact took action in 1990 that appeared expressly to endorse it by adding the term "compensation" to RCW 28B.50.140(3). See infra p. 4.
Thus, under the statutory scheme in place at the time your question was posed, the payment to reimburse the president for the transportation expenses was unauthorized. The board was limited to paying salary and the reimbursement of transportation expenses did not constitute payment of "salary" as defined by AGO 1974 No. 15.
The answer to your question, therefore, is that the board was not authorized to add the $6,000 payment to the president's salary. While this completes our answer to the question you asked, we note that one of the statutes in question has been amended in the interim. Therefore, we think it helpful to continue our analysis to discuss whether this amendment affects the board's authority to reimburse a college president for the president's transportation expenses.
Last year, the Legislature amended RCW 28B.50.140(3). The amended statute provides in part:
Each community college board of trustees:
. . .
(3) Shall employ for a period to be fixed by the board a college president for each community college . . . district . . . and fix their duties and compensation, which may include elements other than salary. Compensation under this subsection shall not affect but may supplement retirement, health care, and other benefits that are otherwise applicable to the presidents as state employees . . . . Compensation and salary increases under this subsection shall not exceed the amount or percentage established for those purposes in the state appropriations act by the legislature as allocated to the board of trustees by the state board for community college education. The state board for community college education shall adopt rules defining the permissible elements of compensation under this subsection;
. . . .
Laws of 1990, ch. 135, § 1, p. 926. Now, instead of fixing "salaries and duties" for college presidents, the board is [[Orig. Op. Page 5]] instructed to "fix their dutiesand compensation, which may include elements other than salary." Id., (emphasis added). The amendment further stated, "[c]ompensation under this subsection shall not affect but may supplement retirement, health care, and other benefits that are otherwise applicable to the presidents as state employees." Id. Finally, the amendment instructed the Board for Community College Education to "adopt rules defining the permissible elements of compensation under this subsection". Id.
This amendment was signed into law on March 21, 1990, becoming effective immediately. Laws of 1990, ch. 135, § 2, p. 929. On March 22, 1990, the Board for Community College Education adopted a regulation which, pursuant to the statutory mandate quoted above, defined the components of a community college president's compensation. Compensation, the rule said, could include, among other elements, "a stipend to compensate the president for providing and maintaining a private automobile for the president's use on college business". WAC 131-16-500(3)(B).2/
Although the board now has the authority to pay compensation, it does not have the authority to set up its own system to reimburse the president for expenses incurred for official use of his or her private vehicle. This is because compensation is different from payments that reimburse a state employee for expenses incurred during the course of employment.
There exists an elaborate, specific and well-developed statutory scheme regulating the reimbursement of state employees for official use of their private vehicles, and we find no indication in the 1990 amendment that the Legislature intended to [[Orig. Op. Page 6]] carve out an exception for reimbursement of community college presidents.
The Legislature has mandated that state employees traveling in their own vehicles are to be reimbursed pursuant to OFM regulations. RCW 43.03.060(1) states:
Whenever it becomes necessary for an elective or appointive official or employee of the state to travel away from his designated post of duty while engaged on official business, and it is found to be more advantageous and economical to the state that travel be by a privately-owned vehicle rather than a common carrier or a state‑owned or operated vehicle, a mileage rate not to exceed the rate established by the director of financial management shall be allowed. The mileage rate established by the director shall not exceed the rates set by the federal government for federal employees.
The language of this section is instructive. It states that "whenever" certain circumstances occur, then a certain rate "shall be allowed" (emphasis added). Here, the statute "shall" apply "whenever" two circumstances are present: first, when it is necessary for a state employee to travel on business, and second, when travel in a privately owned vehicle is "more advantageous and economical to the state." The word "shall" generally means the instruction is mandatory. State v. Q.D., 102 Wn.2d 19, 29, 685 P.2d 557 (1984).
The board of trustees' July 1, 1988 resolution approving the reimbursement of the president's vehicle cost and expenses justified the payment by finding that the president needed to have a car available at all times and no state car was available for his use.3/
Supra at p. 2. By its own terms, then, the [[Orig. Op. Page 7]] resolution addressed a situation already addressed by the Legislature, namely, one where an employee needs to drive his or her own car to perform official duties. Thus, the mandatory language of RCW 43.03.060(1) is invoked, and the board is required to respond by reimbursing the president according to "a mileage rate not to exceed the rate established by the director of financial management". Id.
The regulations by which the director of OFM establishes reimbursement rates provide for reimbursement on the basis of mileage. They do not permit any flat monthly rate of reimbursement such as the board here provided to the president. See WAC 82-36-010et seq. Under these circumstances, the payment is prohibited by statute unless some other statute more specific to the situation authorizes an exception.
No such statute appears to exist. The statute discussed above that authorizes payment of compensation to community college presidents, RCW 28B.50.140(3), does not explicitly or in our view implicitly address reimbursement of expenses for use of a private vehicle for official purposes. The statute does not refer to vehicles at all or to reimbursement of vehicle expenses. The statute is confined to compensation for services. It does not extend to the reimbursement of expenses incurred on behalf of the State. In enacting Laws of 1990, ch. 135, § 1, the Legislature simply authorized payment of compensation in excess of salary. It did not create a specific exemption to its carefully wrought scheme to regulate use of motor vehicles in state government.
Finally, the conclusion reached in this opinion is in harmony with AGO 1965-66 No. 30. In that opinion we drew a distinction between compensation and reimbursement of expenses. The opinion concerned payments to the board of trustees of a state college. No statute specifically authorized payments to the trustees. However, they were entitled to per diem and mileage expenses on the same basis as the other heads of state departments. The board passed a resolution authorizing an additional payment of $40 for each regular or special meeting [[Orig. Op. Page 8]] attended. The question was whether the board had the authority to authorize this additional payment.
We concluded that the $40 payment was not authorized because: "The proposed payment of forty dollars per meeting to each trustee, in addition to reimbursement for expenses as provided by law, is a form of compensation." AGO 65-66 No. 30 at 2 (emphasis in original). "It is a general rule that compensation can be paid to public officers only when affirmatively authorized by law." Id. at 3.
Accordingly, since the legislature has made no provision for payment ofcompensation to members of the boards of trustees of the state colleges (in addition to reimbursement for expenses) and has not authorized the boards to establish compensation by resolution of the board itself, we must conclude that the board lacks the legal authority to adopt or operate under a resolution such as that submitted for our review.
Id. at 4 (emphasis added).
AGO 65-66 No. 30 recognized the distinction between compensation and reimbursement for expenses. That distinction also applies in this case. Here, newly amended RCW 28B.50.140(3) authorizes payment of compensation in addition to salary. It does not authorize payment of additional reimbursement for expenses beyond the OFM formula applicable to other state employees.
In conclusion, the payment to the president contemplated in the addendum to reimburse the president's vehicle costs and expenses represents a new way to calculate vehicle reimbursement. The board has no authority to establish such a new method. That authority rests solely in the director of financial management, and will remain there until the Legislature clearly indicates otherwise.
Thus, with regard to travel expenses, the State reimburses at a particular rate and the board may not provide reimbursement of these expenses at a different rate. The board remains free, however, to define and fix compensation in ways that do not run afoul of the statutes governing reimbursement of expenses. For example, we see no reason why the board could not compensate the president for the service of driving on official business or for any other service. The board could pay compensation in a fixed amount or measure the compensation by the difference between the president's actual driving expenses and the amount of travel expenses reimbursed by the State. In other words, the board may compensate the president for services provided so long as the [[Orig. Op. Page 9]] compensation does not exceed the state appropriation allocated to the board of trustees by the state community college board. However, the board has no authority to supplant the State system for reimbursing travel expenses and to substitute a new reimbursement system in its place.
Based on this analysis, we conclude that the addendum granting a vehicle stipend to the president of a community college as reimbursement for the expense of using a personal vehicle on college business on a basis different from OFM regulations is not authorized by state law.
We trust the foregoing will be helpful to you.
Very truly yours,
KENNETH O. EIKENBERRY
DAVID M. HORN
Assistant Attorney General
*** FOOTNOTES ***
1/RCW 28B.50.140(3) was amended in 1990. See Laws of 1990, ch. 135, § 1, p. 926. We discuss the impact of this amendment at page 4.
2/This rule was first passed as an emergency rule and therefore became effective immediately upon its filing on April 17, 1990. WSR 90-09-069 (May 2, 1990); see RCW 34.05.350(2). Shortly before the rule's expiration, the same language was adopted, again as an emergency rule, on June 21, 1990, and filed on July 6, 1990. WSR 90-15-003 (August 1, 1990). The rule was finally adopted as a permanent rule on September 13, 1990. WSR 90-20-009 (October 17, 1990).
3/We note that provision of a state‑owned or ‑leased vehicle to the president for a mixture of official and personal uses would violate state law:
Notwithstanding any other provision of law, whenever any state agency, institution of higher education, or other appointing authority is empowered to employ or appoint administrators or other personnel and to fix their compensation, such power, in the absence of a specific contrary statutory authorization to the agency, institution of higher education, or appointing authority, shall not extend to the power to provide a state owned or leased motor vehicle for any use other than official state business.