Retiree Work Hour Limitation Suspended for Fire and Mudslide Response Work

February 2018
Number 4

Governor Jerry Brown has suspended the 960-hour per year work hour limit for retired annuitants who assist California counties battling fires and mudslides. CalPERS announced Brown’s suspension of the rule in a January 29 Circular Letter.

Governor Brown issued a pair of executive orders lifting the work hour limit and other rules in an effort to expedite hiring of emergency workers and to streamline the recovery of communities devastated by the disasters. In addition to suspending the work hour limitation for retired annuitants who assist in disaster response and recovery in the affected counties, the emergency orders exempt retired annuitants hired to expedite disaster recovery from separation and break in service requirements and also, limits on the duration of emergency appointments, the Circular Letter says.

Generally, CalPERS retirees may only work 960 hours per year. Retirees who have reached normal retirement age may only be employed with such an employer after their first 180 days of retirement have passed and only during an emergency to prevent stoppage of public business or because they have skills needed to perform work of limited duration, unless an exception applies.

Retirees who have not reached normal retirement age must have a bona fide separation in service. Normal retirement age is defined by CalPERS as the benefit formula age for a position, i.e. age 55 for the 2% at 55 retirement formula. For a bona fide separation to have taken place, the employee must have a 60-day separation from employment and there must not be a pre-determined agreement between employer and employee to work after retirement.

The suspension applies to hours worked to expedite disaster response and recovery in the affected counties beginning on the date a state of emergency was declared and remaining in place until the declaration is lifted. The Governor issued state of emergency declarations on the following dates:

  • Napa, Sonoma, Yuba, Butte, Lake, Mendocino, Nevada and Orange counties: October 9, 2017
  • Solano County: October 10, 2017
  • Ventura County: December 5, 2017
  • Santa Barbara County: December 7, 2017

Per the Circular Letter, all other provisions related to working after retirement will continue to apply, including the requirement that local government agencies continue to enroll and report retired annuitants to CalPERS, the limits on hourly compensation rates and the prohibitions on other forms of compensation in addition to the hourly pay rate, including any benefit, incentive, or compensation in lieu of benefits.

Any agency employing a retired annuitant pursuant to the waivers must notify the director of the California Department of Human Resources. Notification may be sent via email to wildfirerecovery2017@calhr.ca.gov.

In its letter, CalPERS said it will continue to monitor work hours for retired annuitants covered by the Governor’s executive orders and will communicate to confirm when a violation of the work order limitation is found and if it is accepted under the exception in the executive orders. Anyone with questions about the waivers may contact CalPERS’ Customer Contact Center at (888) 225-7377.

For more information about the impact of the Governor’s executive orders or about pensions in general, please contact an attorney at one of our eight offices located statewide. You can also visit our website, follow us on Facebook or Twitter or download our Client News Brief App.

Written by:

Thomas R. Manniello

Partner

Michele Ellson

Paralegal

©2017 Lozano Smith

As the information contained herein is necessarily general, its application to a particular set of facts and circumstances may vary. For this reason, this News Brief does not constitute legal advice. We recommend that you consult with your counsel prior to acting on the information contained herein.

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State Allocation Board Adopts Developer Fee Increases

February 2018
Number 3

The State Allocation Board (SAB) has increased the amount of “Level 1” developer fees that school districts are authorized to collect to $3.79 per square foot of residential development and $0.61 per square foot of commercial development. The increase takes effect immediately, and may now be implemented by school districts through local action.

The new rates, which the SAB approved on January 24, 2018, represent an 8.78 percent increase over the maximum amounts authorized as of February 2016. The SAB based its increase on the RS Means cost index for Class B construction.

Government Code section 65995 authorizes the SAB to increase the amount of Level 1 developer fees that school districts are authorized to collect. Such an increase may be adopted in every even-numbered year. The SAB increase does not affect “Level 2” developer fees, which a school district must adopt annually based on its own school facilities needs analysis. The change also does not affect “Level 3” fees, which school districts may only collect when the SAB certifies that state funds for new school facility construction are no longer available.

Based on this and other legal developments, Lozano Smith is preparing an update for the firm’s publication, Developer Fee Handbook for School Facilities: A User’s Guide to Qualifying for, Imposing, Increasing, Collecting, Using and Accounting for School Impact Fees in California. The handbook is intended to help school districts reduce their legal costs by providing comprehensive information regarding California law and process for school impact fees. The handbook contains procedures, timelines, checklists, and forms to be used when adopting and implementing fees and/or increases.

Lozano Smith is making the handbook available at a cost of $100 to public school districts that are also clients of Lozano Smith. The handbook will be available to non-client public school districts at a cost of $200. Non-public agencies can purchase the handbook at the full price of $300. Districts wanting a second or replacement copy may request one for $75. School districts may order the handbookhere. For more information on the Developer Fee Handbook, or to order a copy, you may also contact our Client Services department at clientservices@lozanosmith.com or call (800) 445-9430.

If you have any questions regarding the adoption or implementation of fee increases or any other developer fee issue, please contact an attorney at one of our eight offices located statewide. You can also visit our website, follow us on Facebook or Twitter or download our Client News Brief App.

Written by:

Harold M. Freiman

Partner

Kelly M. Rem

Partner

Ellen N. Denham

Associate

©2017 Lozano Smith

As the information contained herein is necessarily general, its application to a particular set of facts and circumstances may vary. For this reason, this News Brief does not constitute legal advice. We recommend that you consult with your counsel prior to acting on the information contained herein.

Student Athlete’s Right to Kneel during National Anthem Protected by the First Amendment

January 2018
Number 2

A federal district court in California has granted a preliminary injunction blocking a school district’s policy requiring student athletes to stand during the national anthem at school sporting events.

In V.A. v. San Pasqual Valley Unified School District, the Southern District of California court ruled that kneeling in silent protest is a form of student symbolic speech protected under the First Amendment.

Background

During the first game of the 2017 varsity football season, which was played at the plaintiff student’s school, high school senior V.A. performed a silent protest by kneeling during the national anthem. After doing the same at the team’s second game, which was played at an Arizona high school, students from the opposing team’s school approached students from plaintiff’s school, made racial slurs, threatened to force plaintiff to stand, and sprayed water on the students, striking a nearby cheerleader. After receiving feedback from the community, parents and staff that included concerns about safety, the superintendent issued a memorandum to all of the district’s coaches with a new directive requiring student athletes to stand during the national anthem. The memorandum added that kneeling, sitting or any similar form of political protest could result in removal from the team and from subsequent athletic teams for the remainder of the school year.

The court granted a preliminary injunction in the student’s favor. In doing so, it relied on the U.S. Supreme Court’s preeminent student speech opinion,Tinker v. Des Moines Independent Community School District, which established the principle that students do not shed their free speech rights in school and may exercise such rights absent a material and substantial disruption to the educational environment. Like the students inTinker, who wore black armbands in silent protest of the Vietnam War, the student plaintiff’s silent kneeling did not rise to a level of material interference with or substantial disruption of school activities. The court explained that any threat to student safety was diminished by the district’s agreement to no longer play the Arizona school in sports.

Takeaways

While the preliminary injunction was issued by a federal district court and is thus not binding on all California school districts, the court’s reasoned analysis appears well supported by legal authority and reinforces the idea that, when it comes to student free speech, a school has less deference to restrict speech that expresses a student’s personal opinion. Notably, the V.A. ruling is the first of its kind with regard to K-12 students since the recent spate of silent protests that players have made during professional and college sporting events.

For more information about this ruling or on addressing student free speech rights in general, please contact an attorney at one of our eight offices located statewide. You can also visit our website, follow us on Facebook or Twitter or download our Client News Brief App.

Written by:

Sloan R. Simmons

Partner

©2017 Lozano Smith

As the information contained herein is necessarily general, its application to a particular set of facts and circumstances may vary. For this reason, this News Brief does not constitute legal advice. We recommend that you consult with your counsel prior to acting on the information contained herein.

Tax Bill Eliminates Advance Refunding Opportunities

January 2018
Number 1

On December 22, 2017, President Donald J. Trump signed the Tax Cuts and Jobs Act of 2017, putting into place the most sweeping tax reform seen in three decades, including significant cuts to corporate and individual tax rates. The new law also effectively eliminates a critical tool local agencies have long used to save taxpayers money.

The tax bill eliminated the tax-exempt status of advance refunding bonds, effectively ending their use by local government agencies. Local agencies may still issue them, but the interest is no longer tax exempt for bondholders. The revocation of this long-standing subsidy eliminates a tool that local government agencies, including school and community college districts, have used to restructure existing debt and provide savings to taxpayers.

An advance refunding occurs when issuers replace outstanding bonds with new bonds with a lower interest rate before payment of the original bonds is fully due. Borrowers advance refund their outstanding debt to take advantage of a favorable interest rate environment. Such an approach results not only in a reduction of borrowing costs, but may also free up resources for new projects.

Since 1986, federal tax law has permitted governmental bonds to be advance refunded once. Under the new tax bill, one of the key advantages to advance refundings-tax exempt status- will no longer exist.

Lozano Smith has expertise in public finance matters, serving as bond counsel on more than $1 billion in school district and community college district bond issues. Lozano Smith will be conducting school bond workshops across the state, covering topics that include:

  • Elections: Timelines and requirements
  • Bonds: Types, validity and tax treatment
  • Roles and Responsibilities: Committees, consultants, and counsel
  • Disclosure and Record Keeping: Regulations and legal considerations
  • Statewide Bond: Matching and impact

If you have any questions regarding the tax bill’s impact on your agency, please contact an attorney at one of our eight offices located statewide. You can also visit our website, follow us on Facebook or Twitter or download our Client News Brief App.

Written by:

©2017 Lozano Smith

As the information contained herein is necessarily general, its application to a particular set of facts and circumstances may vary. For this reason, this News Brief does not constitute legal advice. We recommend that you consult with your counsel prior to acting on the information contained herein.

Schools May Discipline Students for “Liking” Offensive, Targeted Social Media Posts

December 2017
Number 87

December 2017
Number 87

A federal district court has ruled that schools may discipline students for “liking” offensive, targeted social media posts.

In Shen v. Albany Unified School District, a Northern California district court concluded that a school could discipline students for liking or for writing approving comments on racist and offensive social media posts targeted at other students, even if the posts were created off campus. However, the court also ruled that the school’s additional decisions to discipline other students who had simply followed the offensive social media account or had approved of more generally offensive posts not directed at any particular student were violations of those students’ free speech rights.

The Shen case is significant because it is one of the first cases coming out of California addressing a school’s ability to discipline students for off-campus expression on social media.

School’s Right to Regulate Off-Campus Speech

Not all off-campus speech is beyond the reach of school officials. In order to discipline (or otherwise regulate) a student for off-campus speech, the speech must meet the requirements of the off-campus speech test. That is, the speech must: (1) be tied closely enough (have some nexus) to the school, or it must be reasonably foreseeable that the off-campus speech would reach the school; and (2) substantially disrupt or materially interfere with the school environment or activities,or it must be reasonable to forecast that it will cause a substantial disruption of or material interference with the school environment or activities, or collide with the rights of students to be left alone in the school environment.

Each of these factors requires careful analysis, and school administrators should exercise caution and investigate thoroughly before proceeding with discipline. While every case is fact-specific, the district court’s analysis in Shen v. Albany Unified School District provides a framework for approaching these issues.

In Shen, a student was expelled after posting racist and derogatory content on an Instagram account, including images of nooses drawn around the necks of an African-American student and an African-American basketball coach. Even though the posts were made off campus, the court determined that because they targeted individual and identifiable students, were readily visible to other students, depicted school activities and responded to events that took place at school, the posts therefore had a close relationship to the school. Based on these factors, the court determined that administrators could reasonably expect the posts would reach the school because some of the targeted students would be affected by the content.

The offensive content was also found to have immediately caused a “substantial disruption.” After learning of the posts, students gathered in a hallway during the school day, intensely talking, crying, and yelling about the posts. Mental health counselors had to be called in to calm students down, classroom instruction was halted to discuss the posts, and several students struggled to attend school or perform schoolwork as a result of the posts. Based on these factors, the court determined that the district’s expulsion of the student who created the posts was appropriate.

Turning its analysis to the students who were suspended for liking and commenting in approval of the posts targeting other students, the court found that their behavior “meaningfully contributed” to the campus disruptions, justifying the discipline and regulation of speech. Online posts that denigrate a student’s race, ethnicity or physical appearance or that threaten violence-and any likes and comments expressly supporting those posts-interfere with a student’s right to be left alone, the court ruled.

Notably, the court reached a different conclusion regarding likes and comments favoring generally offensive, racist, or hateful speech that was not directed toward a specific student. While unsettling, this type of speech is protected under the First Amendment and does not constitute harassment or bullying, the court said. Further, disciplining the student who only followed the social media account, but did not like or comment in support of the offensive content, violated their free speech rights because the act of following is “completely devoid of any affirmative speech.”

Takeaways

While the Shen’s summary judgment order is issued by a federal district court and thus not controlling in California state courts or in other district courts throughout the state, it is one of the first legal opinions analyzing student speech in the context of social media, including reactions to social media posts and following social media accounts. It will, therefore, likely have persuasive effect, if and when relied upon by federal and state courts in California.

For more information regarding the discipline of students for off-campus, online speech, or about student free speech rights in general, please contact the authors of this Client News Brief or an attorney at one of our eight offices located statewide. You can also visit our website, follow us on Facebook or Twitter or download our Client News Brief App.

Written by:

Sarah L. Garcia

Partner

Joshua Whiteside

Associate

©2017 Lozano Smith

As the information contained herein is necessarily general, its application to a particular set of facts and circumstances may vary. For this reason, this News Brief does not constitute legal advice. We recommend that you consult with your counsel prior to acting on the information contained herein.

Opioid Testing Now Required for Employees in Safety-Sensitive Transportation Positions

December 2017
Number 86

Effective January 1, 2018, the federal Department of Transportation (DOT) will require safety-sensitive transportation employees, such as county, city, and school district bus drivers, to be tested for prescription opioids in an effort to tackle opioid abuse. The DOT’s final rule, which was published on November 13, 2017, amends the Code of Federal Regulations.

Under the new rule, the DOT will require safety-sensitive transportation employees to be tested for the following four “semi-synthetic opioids”: hydrocodone, oxycodone, hydromorphone, and oxymorphone. These opioids are commonly known as OxyContin, Percodan, Percocet, Vicodin, Lortab, Norco, Dilaudid and Exalgo. The employees will continue to be tested for other drugs, including marijuana, cocaine, and methamphetamine.

Six federal agencies, including the Federal Motor Carrier Safety Administration (FMCSA) and Federal Transit Administration (FTA), define safety-sensitive positions. Under the FMSCA, safety-sensitive positions include operators of commercial motor vehicles. The FTA provides that employees in safety-sensitive positions include those who operate, control, and/or maintain a revenue service vehicle; operate a vehicle that requires a commercial driver’s license; and those who carry a firearm for security purposes.

Under current law, an employee in a safety-sensitive position can only use prescription pain medications if a medical practitioner familiar with the employee’s medical history and job duties has advised the employee that the medication will not “adversely affect” his or her ability to safely perform their job duties. However, not all employees ask their medical practitioners if their medications will impact their ability to work or ask their employers whether they can continue working while using these pain medications.

The DOT’s new rule will increase the regulation of employees’ use of prescription pain medications. If employees test positive for these medications, they will still have an opportunity to provide a “legitimate medical explanation” to medical review officers, the independent physicians responsible for receiving and reviewing results from a drug test. According to the DOT’s new rule, a “legally valid prescription” can constitute a legitimate medical explanation, but a medical review officer is still required to interview the employee and review his or her medical records before deciding whether his or her result from a drug test is negative. Even if the result is ultimately negative, the medical review officer may have a responsibility to raise fitness-for-duty considerations with an employer.

The DOT’s new rule provides employers another opportunity to inform employees in safety-sensitive positions about the effect prescription pain medications may have on their ability to safely perform their job duties. For more information about the DOT’s new rule or drug and alcohol testing in general, please contact the authors of this Client News Brief or an attorney at one of our eight offices located statewide. You can also visit our website, follow us on Facebook or Twitter or download our Client News Brief App.

Written by:

Dulcinea A. Grantham

Partner

Ameet K. Nagra

Associate

©2017 Lozano Smith

As the information contained herein is necessarily general, its application to a particular set of facts and circumstances may vary. For this reason, this News Brief does not constitute legal advice. We recommend that you consult with your counsel prior to acting on the information contained herein.

School District Bid Threshold Raised for 2018

December 2017
Number 85

School districts’ bid threshold for purchases of equipment, materials, supplies and services (except construction services) has been adjusted to $90,200, effective January 1, 2018. This represents an increase of 2.20 percent over the 2017 bid limit. The notice may be viewed here.

Under Public Contract Code section 20111(a), school districts must competitively bid contracts over the bid limit and award to the lowest responsible bidder, unless an exception applies. Contracts for amounts that fall under the bid limit may be awarded without competitive bidding.

The California Community Colleges Chancellor’s Office is expected to announce a similar adjustment to the bid threshold for community college districts’ purchases of equipment, materials, supplies and services except construction services, pursuant to Public Contract Code section 20651(a), sometime in the next few days. Once released, that information will be available here.

The bid limit for construction projects remains at $15,000.

The bid thresholds for cities, counties and special districts are not affected by the bid limits discussed here.

For more information on the new bid limits or bidding in general, please contact an attorney at one of our eight offices located statewide. You can also visit our website, follow us on Facebook or Twitter or download our Client News Brief App.

Written by:

Ruth E. Mendyk

Partner

Michael Dunne

Paralegal

©2017 Lozano Smith

As the information contained herein is necessarily general, its application to a particular set of facts and circumstances may vary. For this reason, this News Brief does not constitute legal advice. We recommend that you consult with your counsel prior to acting on the information contained herein.