Salaries for county commissioners and councilmembers may be set by salary commissions established by ordinance or resolution of the county legislative authority.  Each commission must consist of 10 members appointed by the county commissioner or executive with approval by the county legislative authority, or by a majority vote of the county legislative authority if there is no single county commissioner or executive.  Six of the 10 members must be selected by lot by the county auditor from among registered voters eligible to vote at the time of selection.  The remaining four members are appointed by the county executive or commissioner, or by a majority vote of the county legislative authority, and must have experience in the field of personnel management, including members representing each of the following four sectors in the county:  business, professional personnel management, legal profession, and organized labor.  In noncharter counties, the county auditor shall select two commission members living in each commissioner's district.

Salary commission members may not be appointed to more than two terms.  City and county officers, officials, and employees and their immediate family members are not eligible to serve on the salary commissions.  Salary commission members may be removed during their terms only for incapacity, incompetence, neglect of duty, malfeasance in office, or a disqualifying change of residence.

Salary changes determined by the local salary commission are filed and become effective and incorporated into the budget without further action.  Salary increases may be effective during the term of office, but salary decreases become effective during the subsequent term.

Decisions of the local salary commissions are subject to referendum in the same manner as an ordinance upon filing a petition within 30 days after filing the salary schedule.  If a valid referendum petition is filed, any challenged salary changes do not become effective until approved by the voters at the next general or municipal election occurring at least 30 days after the petition is filed.

Local salary commission decisions to fix salaries supersede other provisions of state statute or local ordinances related to municipal budgets or salaries for local officials.

Current salaries established under an ordinance or charter provision substantially complying with the salary commission requirements remain in effect unless and until changed according to the new requirements.

For noncharter counties, the county auditor must select at least one commission member living in each commissioner's district, and must establish policies and procedures for conducting the selection by lot.

Policies and procedures must include, but not be limited to:

• the manner for notifying persons selected by lot;
• providing a new selection from a commissioner's district if a person selected from the district declines appointment to the commission; and
• the process for filling a vacancy, if, following the person's appointment, the person's position on the commission becomes vacant before the end of the person's term of office.

Additional commission members may be appointed by majority vote of the county legislative authority.  Additional commission members must be residents of the county and must have experience in the field of personnel management or a related field.  The number of salary commission members selected by lot must constitute the majority of commission members.

Salary commissions in existence prior to the effective date of an increase in the number of board of county commissioners from three to five may retain their composition for one year after the start of the terms of the newly created county commissioner positions, or until changed in accordance with this act, whichever occurs first.

Salary increases and decreases are subject to referendum petition by the people of the county upon filing a petition with the county auditor within 30 days after filing of the salary schedule.

For a charter county, the petition must be subject to referendum in accordance with the county charter.

For a noncharter county, the petition must be subject to referendum as follows:

• Within 10 days of the date of the petition, the county auditor or their designee must confer with the petitioner concerning form and style of the petition, and issue an identification number for the petition; the prosecuting attorney must write a ballot title for the measure; and the petitioner must be notified of the identification number and ballot title.

• After notification has been provided to the petitioner within this 10-day period, the petitioner has 30 days to secure on petition forms the signatures of not less than 15 percent of the registered voters of the county at the last general election and file the signed petitions with the county auditor.  Each petition form must contain the ballot title and full text of the measure to be referred.
• The county auditor must verify the sufficiency of the signatures on the petitions and determine the validity of the referendum petition.  If the county auditor determines the number of verified signatures is insufficient, or the referendum petition is invalid, the salary change takes effect on the date specified for the salary change filed by the commission in accordance with this act.

Referendum measures must be submitted to the voters of the county at the next general or municipal election occurring after signatures are verified by the county auditor and after the filing deadline established by statute.  If the filing deadline for the following general or municipal election has passed, the legislative authority of the county may call for a special election on the first election date provided by statute.

If the referendum is approved by affirmative vote, the salary change takes effect on the date specified for the salary change filed by the commission, and is incorporated into the county budget without further action of the county legislative authority or salary commission.