Demands against the city for money or damages are governed by Part 3 (commencing with Section 900) and Part 4 (commencing with Section 940) of Division 3.6 of Title 1, except as provided therein, or by other statutes or regulations expressly applicable thereto.
Legislative BodyFinancial Powers
Section § 37201
If you have a claim for money or damages against the city, it must follow the rules set out in certain sections (starting with Section 900) of the California Government Code, unless other specific laws or regulations apply.
city claims money demands damages claims
Section § 37202
This law requires that any financial demands or requests for payment made to a legislative body must be approved or rejected only after being thoroughly checked, as outlined by local rules. These demands can be reviewed individually or as part of a list. The person submitting these demands must include a sworn statement confirming that the demands are correct and that there are enough funds to cover them.
Except as provided in Section 37208, the legislative body shall approve or reject demands only after such demands have been audited in the manner prescribed by ordinance or resolution. Such audited demands may be submitted separately or a register of audited demands may be submitted to the legislative body for approval or rejection and shall have attached thereto the affidavit of the officer submitting the demands certifying as to the accuracy of the demands and the availability of funds for payment thereof.
financial demands legislative body approval audited demands
Section § 37203
This law states that when a request for payment is approved, the mayor needs to issue a document called a warrant, instructing the city treasurer to pay from a specific fund for a specified purpose. The city clerk must also sign this warrant. The city's legislative body can set up different ways for issuing these warrants and checks if they choose.
Upon allowing a demand or approving a register of audited demands, the mayor shall draw a warrant or warrants upon the city treasurer specifying the purpose for which drawn and the fund from which payment is to be made. The city clerk shall countersign the warrant. The legislative body, by ordinance or resolution, may prescribe an alternative method of drawing warrants and checks.
warrant issuance city treasurer payment approval
Section § 37204
If a city does not have enough money to cover an expense that fits within the year's income and revenue, the city clerk must mark the order or demand with 'Not approved for want of funds,' add the date it was submitted, and sign it.
When an order or demand is not approved for want of funds and its amount does not exceed the income and revenue for the year in which the indebtedness was incurred, the city clerk shall endorse on it: “Not approved for want of funds,” with the date of presentation and his signature.
city clerk responsibilities endorsements insufficient funds
Section § 37205
This law explains that the clerk is responsible for numbering and recording orders or demands and then giving them to the person who made the claim or someone they authorize. These orders start earning 6% interest annually once they are delivered.
It's important to note that payments are made in the sequence in which the orders are registered, meaning earlier registered claims are paid first.
The clerk shall number the endorsement, register the order or demand in his records, and deliver it to the claimant, or his order. From delivery the order or demand bears interest at 6 percent a year. Orders or demands shall be paid in the order they are registered.
clerk responsibilities endorsement numbering registering orders
Section § 37206
The city or town's governing body must decide on the schedule and process for paying its workers' salaries and wages through an official ordinance or resolution.
By ordinance or resolution, the legislative body shall prescribe the time and method of paying salaries and wages of officers and employees.
ordinance resolution legislative body
Section § 37207
Department heads are responsible for verifying or approving the payroll or attendance records for the employees in their departments. Meanwhile, the city clerk handles the certification or approval of payroll or attendance records for other officers and employees.
Department heads shall certify or approve departmental pay rolls or attendance records for employees in their departments. The city clerk shall certify or approve pay rolls or attendance records of other officers and employees.
department heads payroll certification attendance records
Section § 37208
This law says that payroll checks don't need to be reviewed by the city council before they're paid out, but they must be approved at the next council meeting after they're issued. Similarly, payments that follow a pre-approved budget can also bypass pre-payment scrutiny. However, both payroll and budgeted payments should eventually be included in a detailed financial report that is reviewed and approved by the council.
(a)CA Government Code § 37208(a) Payroll warrants or checks need not be audited by the legislative body prior to payment. Payrolls shall be presented to the legislative body for ratification and approval at the first meeting after delivery of the payroll warrants or checks.
(b)CA Government Code § 37208(b) Warrants or checks drawn in payment of demands certified or approved by the city clerk as conforming to a budget approved by ordinance or resolution of the legislative body need not be audited by the legislative body prior to payment.
(c)CA Government Code § 37208(c) Notwithstanding subdivisions (a) and (b), budgeted payrolls and demands paid by warrants or checks may be presented to the legislative body for ratification and approval in the form of an audited comprehensive annual financial report.
payroll checks city council approval budgeted payments
Section § 37209
This law allows a city to transfer the responsibilities of the city clerk to a director of finance if that position is created and its duties are outlined by a city ordinance. The director of finance must also secure the same bond that the city clerk is required to have under another section of the code.
The duties imposed upon the city clerk by this article may be transferred to a director of finance when such office has been established and the powers and duties thereof defined by ordinance. Such an ordinance shall require the execution by the director of finance of the bond required of the city clerk by Section 36518 of this code.
city clerk duties director of finance transfer of responsibilities
Section § 37210
If a new city in California hasn't yet received property tax revenue, it can issue temporary notes, which are essentially IOUs, to cover its expenses and pay its employees. These notes can have an interest rate no higher than 6% and must be repaid by the end of the fiscal year they were issued in. The total amount of these notes can't be more than 85% of the revenue the city expects to get that year. Repayment has to come from the city's earnings within that same fiscal year.
Newly incorporated cities that have not received revenues from property taxes may issue temporary non-negotiable notes bearing interest at a rate not exceeding 6 percent per annum to pay lawfully incurred current expenses and the salaries and wages of officers and employees. Said notes must be repaid on or before the last day of the fiscal year in which the money is borrowed and the maturity date of said notes shall not be later than said last day. The aggregate amount of said notes shall not exceed 85 percent of the anticipated revenues for the fiscal year in which the money is borrowed. Said notes shall be repaid only from revenues received during or allocable to the fiscal year in which the money is borrowed.
newly incorporated cities temporary notes non-negotiable notes
