Efforts to oust Mayor Randy Stone have not been going well – did Sean Morgan really think he could get the liberals to vote for that discussion? Or was he just grandstanding for his peanut gallery? Not sure. But something I noted during the discussion – Ann Schwab is acting like she’s having some sort of nervous breakdown, and she should really consider stepping out of the way when her current term is up.
I don’t know how the signature gathering is going, the Recall Stone/Ory people are being mum on that one. I don’t know if they hired professional signature gatherers, but one organizer mentioned the name of an old local political operative. And, despite claims the recall people don’t have any candidates to step forward, I can’t help but notice Nichole Nava and Andrew Coolidge are working overtime to get their names out there.
And when we asked Nava who is financing the recall she said, ” The finances are available on the state elections website. Have at it.” That’s not an answer, that’s evasive, and you just have to wonder why.
I was disappointed but not surprised with the council’s decision to deny the appeal of Simplicity Village, but more disappointed to see that Morgan didn’t even show up for the vote. Is he thin-skinned?
I saw the little shack CHAT had brought – self contained, with a combo toilet-shower enclosed in a stall with a curtain? For two people? Does it come with a gas mask? But I never heard any answers about septic/sewer from the proponents during the hours long circus that was allowed by Mayor Randy – including a guy who got up to the podium and sang a song from the old Broadway/film musical “Cabaret”.
Ever watch Cabaret? Don’t take the kids. If I had thought of it, I would have followed up with a very ribald rendition of “Money Money”.
Because that’s what all this is about – city $taff will entertain any crazy notion that will result in some sort of grants, and that’s what the “Shelter Crisis Designation” is all about – roughly a half a million a year in state grants. And, contrary to some people’s belief, that money doesn’t rain from the sky, or come from the pockets of the rich, it’s tax money and you pay it.
Tuesday’s regular Council agenda is available online. Here’s hypocrisy – the liberals who are so worried about housing the poor are raising rates at the city compost facility, just as people all over Butte County are dealing with dead trees. It’s not just about the Camp Fire, trees are dying all over Chico because Cal Water jacked their rates during that last dry summer, and never brought them down. We cut water at our rentals, and still have two enormous cedar trees to get rid of, and no room at the compost facilities. So Chico raises their rates? What does that sound like to you?
It’s the clinking, clanking, clunking sound that makes the world go ’round…
Bob sent the article below the other day – it’s a good read for Halloween.
About 7 years ago, short-lived city manager Brian Nakamura told us about the pension liability, and he briefly mentioned the “benefits liability”, but that second topic never came up again. Here below, George Russell talks about the “OPEB” liability – “other post employment benefits”.
So, the League of California Cities, and city management all over the state are looking out over the back of the boat, the cigarettes are falling out of their mouths, and they’re saying, “You taxpayers are going to need a bigger boat...”
Here in Chico, they have never told us point-blank about OPEB, but I’m sure it comes up at those small, daytime meetings that nobody attends. So I asked city finance manager Scott Dowell – he’d recently given me a figure for the “unfunded accrued liability” – I didn’t know if that figure was just pensions or included the OPEB. His response, simply, “No, OPEB is separate.” But no figure, I had to ask for that in a separate email. Cause they just don’t want to tell us this stuff, it’s counter to their best interests.
I call this “willful insubordination,” but I went ahead and sent a separate e-mail asking him for the figure. I try to be nice, I apologize for bothering this guy. I’ll get back to you with his response.
I was at an event at City Plaza in downtown Chico last Thursday evening and was very disappointed by the disgusting state of the plaza.The cement was filthy, looked like it needed power washing long ago. The grass was cut very short, dry and splotchy; it had no chance of growing, it looked terrible.
Then there are the bathrooms? Totally gross. The whole plaza smelled of urine.
That plaza was a gem for our community but it certainly is no longer. I guess I should take some responsibility for the state of disrepair as I am a citizen of this community; however, I have discontinued attending things in the downtown area because it seems to be this way the majority of the time now.
I’m not sure what I can do. I help out at the shelters and I do not give to panhandlers, this definitely is not enough. I guess when we don’t take pride in the things that we have they fall into disrepair and lack beauty. Kind of sounds like society as a whole these days?
— Elise Gladu, Chico
But I disagree with Gladu’s conclusion. I am not going to take responsibility for the state of disrepair, people are paid to take care of these facilities, six figure salaries, plus benefits. I am a citizen of this community, I obey the laws, I pay my taxes, fees and utility bills. And I do know what to do – educate yourself before you go to the ballot box and demand more and better service out of bloated, complacent public agencies like the City of Chico and Chico Area Recreation District.
I don’t like the chiding tone at the end either. I smelled a plant, so I searched Elise Gladu and found she works for CARD and Chico State. So, she’s not going to call out the pensions.
Of course she’s entitled to her opinion, I just think it’s good to know what actually shapes a person’s point of view, especially when it’s their bottom line.
This is what we can expect – one public employee – future pensioner – after another, coming forward to stump for the tax measures CARD and the city of Chico have planned for the 2020 ballots. Well, tit for tat – I rattled off the following letter:
Like Elise Gladu, I had an experience in Downtown Chico that left me disappointed by the disgusting state of city plaza – relatives came from out of town, and we took them to Thursday night market.
We had not been Downtown for awhile, and were embarrassed. Yes, the sidewalks were filthy, expensive cement trash cans had been destroyed by vandals, and shop windows had been etched with tags and obscenities. The stink of garbage, urine and cigarette/pot smoke was overwhelming. Transients had spread their bedrolls all over plaza lawns and walkways, their dogs wandered free, doing what dogs doo-doo.
There is no excuse for the condition of Downtown. Downtown business owners are made to pay into an “improvement district”. Why isn’t the DCBA washing down sidewalks every morning? City ordinances prohibit public urination, littering, vandalism, “sitting and lying” on public walkways, camping, unleashed dogs, and smoking within a certain distance of doorways, including city hall. Why aren’t the ordinances enforced?
In a 2018 report, the League of California Cities warned that “City pension costs will dramatically increase to unsustainable levels.” First suggestion – make more aggressive payments to CalPERS. Meanwhile, “Change service delivery methods and levels of certain public services.” The report continues, “Often, revenue growth from the improved economy has been absorbed by pension costs. The next round of service cuts will be even harder.”
The obvious strategy – cut services and threaten more cuts until the voters agree to pay more taxes. It’s a carrot on a stick, don’t bite.
It’s always interesting to see the search terms by which people find their way to this blog. For about a week now the Yuba County sales tax lawsuit has been at the top of the pile:
yuba county sales tax 1% increase by voters,
homeless in ca chico 2019,
homelessness problem chico,
homelessness chico,
kamala harris corrupt
But this week “homeless” related terms are moving in on the number 1 spot, bumping out the perennial favorite, “kamala harris corrupt”
When my husband and I went out to run errands the other morning, we noticed the tents had sprung up again at “Devil’s Triangle,” the median next to Little Chico Creek at Mulberry Street. As we made our way out to 20th Street we saw the army of zombies leaving various shelters in the neighborhood, some of them carrying trash bags bloated full of aluminum and plastic stolen from recycling bins. Some pulled mounds of crap in their sagging bike carts. One man walked along behind a stolen shopping cart full of what looked like rags and unrelated objects routed out of garbage cans.
A man stood unabashed, panhandling at the door of Food Maxx. We’ve noticed a lot of stores have finally developed no tolerance policies toward panhandling, but transients still try to slip in unnoticed, walk up to you in the parking lot as if asking for directions, and hit you up. We walk past these people stone faced. I don’t want to hear their stories, I got stories of my own that keep me awake at night. Spare money? Are you fucking kidding me? Why would I be shopping at Food Maxx if I had money to hand out on the corner?
Next stop Payless Building Supply to replace some warped and broken old fence boards at one of our rentals. Payless has helped us keep our rental expenses down with low-cost building materials. We do our own work to save money, we know if our rentals are too expensive we won’t be able to find tenants. For years we’ve enjoyed a good relationship with PBS, who also offer credit so you can spread out your payments on big enterprises. This has really helped when we’ve bought old crappers that needed a lot of work before they were even habitable.
PBS owner Frank Solinsky notified us a few months ago that he was appealing a City of Chico decision to place a tiny house “Simplicity Village” on the lot adjacent to the PBS yard. For years that lot has been a problem because the city has turned a blind eye to illegal camping and other activities there. We’ve seen the shanties they’ve built with lumber and supplies stolen from the yard, just a hop over the fence and back. Solinsky has had to add security measures to the cost of our building materials, and I resent that.
I also resent this group not wanting to comply with the building code, or pay the ridiculous fees put not only on developers but any homeowner who wants to do anything to their property, even fix a leaking roof. I stood in the county permits line once behind a lady as she was told she would have to pay 100’s of dollars in permit fees to replace the rotting wooden steps off her kitchen door.
Chico Housing Action Team, the group that is trying to force the tiny village onto a lot with no plumbing, no infrastructure like sidewalks, and against the city building code. They want put people in sheds with no plumbing, heat or air conditioning. They want a central toilet, but have not explained who will pay to have that facility hooked up to city sewer. They want to be excepted from just about every law on the books.
They say the residents will be carefully vetted, and held to rules of behavior. But there will be no onsite supervision, this group of otherwise dysfunctional transients will be “policing themselves”. I think Solinsky is right to be alarmed with this situation.
When the city council first permitted this pending train wreck, Solinsky hired lawyer Rob Berry of Chico First to bring an appeal before council. You have to pay to file an appeal, so you have to have money to throw away. It used to be $180, and there was a low-income waiver, but years ago, former council member Andy Holcombe, outraged because our neighbors successfully appealed a decision in our neighborhood, vindictively went about getting rid of the low-income waiver. It never came to council, he did it “administerially” Holcombe couldn’t believe that a homeowner would be low-income, yet he champions low-income housing projects like CHIPS and Habitat for Humanity. The hypocrisy in this town is just overwhelming.
Solinsky is a small business owner, and it’s the nickel and dime crap that brings down a small business. As customers walk away because they don’t like what’s going on in the neighborhood – or paying for it in the price of their goods – he’s finding himself fighting for his livelihood.
So when Council (scuse me, that was the Planning Commission) rejected his first appeal, he decided to bring it back. I don’t know the process, but I’m wondering if there is a point where he will just sue the city. Anyhoo, council has agendized a special meeting to hear his appeal, on September 24, 6 pm. I don’t know why they need to have a special meeting instead of bringing it up on a regular agenda.
Council will also be discussing Vice Mayor Brown’s recent request to waive user fees for Chico State’s “Lame Debate,” which sucks – everybody else has to pay to use City Hall or City Plaza, just like we’d have to pay to use any facility at Chico State. Brown, Schwab and Morgan are employees of Chico State, which seems like inappropriate influence.
And, of course, there’s a closed session item – “conference with legal counsel” over “anticipated litigation”. Oh, gee, is somebody suing the City of Chico, again?
This special meeting deserves some special attention. Here’s the agenda:
Tonight I’m going to try and watch Chico City Council on my laptop – Sean Morgan wants to agendize, for a future meeting, a discussion of removing Randall Stone as mayor. Stone was really rude and kinda acted a little crazy at a recent meeting, may have even broken the law when he refused to let a citizen bring up a topic during “comments from the floor portion of the meeting. I watched the tape, Stone was his usual self – I watched him stand up in his chair to attack a citizen at a finance committee meeting last year, I thought he was going to climb over the table and punch the old broad myself. He has acted irrational and hostile toward me and in front of me on several occasions, I don’t think he’s fit for office, but he sure keeps getting his ass elected.
I have to wonder, are the voters informed enough to vote? Do they just keep electing him because he’s got a competent sounding name? Do they ever attend or watch the meetings?
Oh well, I don’t think Morgan will even get this discussion on the agenda, but if you haven’t seen Stone run a meeting, this would be a good meeting to watch.
Voters should attend more meetings, that’s the only way a voter is going to get informed. The media only tells us what $taff wants us to hear. So, I attended those “informational” meetings CARD ran regarding their parcel tax proposal, and I think I caught General Manager Ann Willmann in a fib – you tell me.
I sent the following letter to the Enterprise Record.
I’ve attended three of five “informational” meetings hosted by Chico Area Recreation District General Manager Ann Willmann. At the first session, a man brought up the pension deficit. Willmann told the gathering that CARD pays a total 14% toward employee pension cost and that she pays 8%, which she said is her share plus 1% of the “employer share”.
When I attended the last session September 10, I asked Willmann why the city of Chico pays between 21% and 31% of their pension cost while CARD only pays 14%. She told me she couldn’t answer at the meeting, not wanting to spread misinformation, and said she’d get back to me via email later.
Via email, Willmann explained that the agency actually pays 17.127%. She pays 8% of that, which is not “half plus 1%”. Furthermore, “parks and unrepresented staff” only pay 5.50%, which is less than a third of the agency’s total payment. Only employees hired after January 2013 actually pay half of the agency cost, but CARD only pays a total 13.735% for those employees.
This is how CARD has garnered more than $2,800,000 in pension liability, which has grown by over a million dollars since 2014, even while they made “side fund pay-offs”. This is the kind of information the public needs to make an informed decision. Willmann said she didn’t want to misinform the public – why did she tell us she paid half plus 1% when she does not, in fact, pay half plus 1%? And why didn’t she correct herself in front of the public instead of answering me privately?
Sorry, busy busy – I received GREAT NEWS about the Yuba County Measure K lawsuit, and I forgot to post it.
The judge ruled in favor of the plaintiffs –
Accordingly, for all of the forgoing reasons, the Court grants judgment in favor of Plaintiffs on their first and second causes of action seeking to invalidate Measure K because it failed to garner the required two-thirds vote required for enactment of a special tax.
What happens next – later that day I received a note from my friend Connie –
“At a BOS meeting yesterday, they voted in CLOSED SESSION to appeal the ruling. That gave the voters and taxpayers no opportunity to voice their concerns etc.”
Yes, the Yuba County supervisors voted to spend MORE TAXPAYER MONEY to fight a court ruling. Like I told my friend Connie, studies show appeals don’t have a very high success rate, only about 17% of these lower court decisions are actually overturned, it seems most appeals are thrown out without hearing due to procedural errors. But the taxpayers will pay for all that – I hope they remember all this at election time.
The city of Chico will not make the same mistakes Yuba County made. City Asst Mgr Chris Constantin has repeatedly warned city staffers, as well as elected and appointed officials, that the city can’t put any specific purpose on their planned sales tax increase because that would require a 2/3’s vote of the public. And I think their surveys have shown very clearly that they will be lucky to get 51%.
Their campaign so far, like CARD’s, has been to point out the failed state of our city infrastructure, the public safety concerns, and our growing population, telling us there’s not enough money to go on from here.
The answers to theses claims are as follows:
our city infrastructure has been neglected while they’ve raised their own salaries and paid their pension deficit with our money
public safety is at an all-time low because the city has declared a “shelter crisis designation” to get in on the gravy train of “the homeless industrial complex”
our population is growing because the city keeps approving development. And now they’re talking about buying water from Paradise to take the pressure off our ground water supply? Why do they continue to approve subdivisions for which there is no water? Because if they stopped approving all this new development they’d lose all those developer fees and the resulting new property taxes.
Our city staff are a bunch of junkies – money junkies. I know public workers – they tend to spend money just like the agencies they work for. The new job requires a bigger, fancier house and lifestyle (watch “Fun With Dick and Jane”, the old version). These people are as over their heads as the economy. They can’t stop making more money, they’re up to their necks in debt.
So while we raise a glass to the folks who fought Measure K, we better be getting ready to fight our own battle.
I attended the last “informational” meeting hosted by Chico Area Recreation District General Manager Ann Willmann. What’s interesting about these meetings is watching Willmann put her spin on the truth.
First of all, although this was the least-attended meeting of the three I’ve been to, the folks who did show up seemed a lot better informed and asked good questions. Second, Willmann has had to incorporate more information into her presentation, obviously in response to questions and comments made over five meetings, as well as my letters to the editor, and, who knows what communications she has received from other members of the public. She’s on the defensive, and it’s not just me that’s putting her there.
I almost laughed out loud when she started into her spiel about CARD losing money over the Camp Fire. She started to explain how the county of Butte puts alllllll the property tax into a big pot, or “bucket”. Then they dip out 1% of the total and divvy that between all the agencies that receive property tax money, including CARD. So what I hear is, towns that have their own rec districts are paying to support CARD. That’s great.
But another man interrupted her, reminding everybody the state is “backfilling” that lost money, to the tune of $200,000 a year, for the next three years. Willmann seemed to lose a little bit of steam over that, admitting he was right, but adding that, gee, she just didn’t know what was going to happen after that three years. Well Annie dear, houses will be rebuilt, will be worth more than they were before the fire, and property tax revenues will go up. She knows that, but she is trying to tell us the Camp Fire resulted in less revenues for CARD. She really thinks she can bullshit that point – I was glad to hear somebody who has been paying attention pull the cork out of her ass.
The questions people raised at this meeting gave me hope. This parcel tax is not a done deal. In fact, if there was a stronger response from the public, CARD board members might even decide not to put it on the ballot. Yesterday, as I listened to Willmann give more details about the survey CARD paid EMC to run earlier this year, I became more and more convinced the survey was actually more negative than Willmann is letting on. CARD board and staff members are desperate to make the public agree to put a new 30 year tax debt on themselves.
The board has allowed themselves to be duped into believing a tax is the only way out of their current pension disaster. Willmann has repeated The Big Lie throughout this lecture series of hers – she sounds like an old mobster – once you’re in CalPERS, you’re IN! She has a mouse in her pocket – “we” have to buy “our” way out.
Well, I do believe, if they don’t do something, the agency will become insolvent trying to pay their pension deficit. But, Willmann refuses to talk about the best option – the best for everybody, including the taxpayers. The employees need to start coughing up more money out of their own pocket. They need to start paying 50% of their pension now, and that needs to increase to 80% over the next 10 years. The taxpayers already provide these people with more than generous salaries, to be expected to pay double what we pay in salary by way of these pension bail-out payments is way beyond reason, it’s unsustainable. CARD staff have completely forgotten their mission to serve the public, choosing instead to enrich themselves.
And here’s another important thing they need to do – take salary freezes now, and when the freeze is over, cap raises at inflation. Inflation averages about 2% a year. General Manager Ann Willmann just took an 11% RAISE, from $113,000/year to $127,000. Her old benefits package was about $29,000 – this will go up, what, another 11%? Remember, this woman has bragged about paying 8% of her pension – 8% of her salary, which would amount to $12,000. For a pension of over $88,000/year, with cost of living increase, for the rest of her life.
Willmann says the pensions are out of her hands? Bullshit. She says “this needs to be handled at the CalPERS level and the legislative level…”
But local gadfly John Merz got to the truth when he asked Willmann, “how’s your union representation?” Yes, full time CARD employees, 35 according to Willmann, are represented by 2 separate unions, divided between management and “workers.” Willmann admitted that “classic” or management members still get their “2% at age 55” formula. I can’t explain the 2% – when I asked Randall Stone to explain it to me he was hostile and refused – but I can explain the “55” – Willmann can retire at 55, with 70% of her highest year’s salary, which at this point, would amount to almost $90,000/year. With an automatic cost of living increase every year.
But new employees – PEPRA – would have to wait until age 65. Why’s that? We saw in the last post how different employee groups and different public agencies pay different amounts. When I asked Willmann about this discrepancy between what CARD pays (14%) and what the city of Chico pays (21 – 31%) and then what the different “bargaining units” pay, she got kind of flustered, told me I’d have to wait for a member of her staff to get back to me. “I don’t want to spread misinformation…”
Well, there’s obviously bargaining going on here – that’s why they call them “bargaining units”. Willmann admitted to Merz that the employees are represented by a paid union member. Who represents the taxpayers in these bargaining sessions? Three pensioners (Lando, Nickel and McGinnis), a political operative (Worley) and an idiot who goes whichever way the wind blows (Donnan).
So it’s not, as Willmann would have us believe, up to CalPERS, or up to the legislature. It’s between her and the board, in closed sessions to which the public is not admitted.
Maybe it’s time to start writing letters directly to the board.
Let’s have a good laugh, cause we probably need one.
I think that clip is a good analogy of the way public agencies spend money.
Seriously, I’ve been mulling over an article from Edward Ring, a financial analyst, co-founder of the California Policy Center. It’s a good read to get you ready for Halloween. See the link at the bottom of this post.
Okay kids, turn down the lights and let’s sit around in a circle and see who pees their pants first.
“Key Findings”: (1) City pension costs will dramatically increase to unsustainable levels, (2) Rising pension costs will require cities to nearly double the percentage of their general fund dollars they pay to CalPERS, and (3) Cities have few options to address growing pension liabilities.
According to CalPERS “Public Agency Actuarial Valuation Reports,” over the next six years, participating agencies will need to increase their payments to CalPERS by 87%, from $3.1 billion in the 2017-18 fiscal year to $5.8 billion by the 2024-25 fiscal year.
And that, according to Edward Ring, is a “best case scenario”. This guy could scare the shit out of Stephen King.
“Bartel Associates used the existing CalPERS’ discount rate and projections for local revenue growth. To the extent CalPERS market return performance and local revenue growth do not achieve those estimates, impacts to local agencies will increase.”
Now remember, the actual authors here are CalPERS and the League of California Cities, Ring is just the storyteller, and I’m just repeating what he says. Here’s what I’ll add – Chico is a member of the LCC, in fact, Mayor Randall Stone has held office in the League. So this story is about Chico.
Ring continues his analysis, “The report from the League of California Cities includes a section entitled “What Cities Can Do Today.” This section merits a read between the lines”
You can go ahead and read his full article yourself, at least he’s got a sense of humor, but I’ll tell you what the league said, as it relates to the city of Chico, as well as Chico Area Recreation District.
1 – “Develop and implement a plan to pay down the city’s Unfunded Actuarial Liability (UAL): Possible methods include shorter amortization periods and pre-payment of cities UAL. This option may only work for cities in a better financial condition.”
Both the city and CARD have already done this. For example, in 2015, CARD ignored a consultant’s report that Shapiro Pool could be saved for about $550,000, instead making a $400,000 side fund payoff to CalPERS. The city of Chico has also been stepping up their payments, we’ll get to where that comes from in a minute.
2 – “Consider local ballot measures to enhance revenues: Some cities have been successful in passing a measure to increase revenues. Others have been unsuccessful. Given that these are voter approved measures, success varies depending on location.”
The city of Chico and CARD have been hiring consultants to pursue tax measures since 2012. The common factor is former Chico city manager Tom Lando, who has sat on the board at CARD for over 4 years now, and who has also managed the Feather River Park and Rec District in Oroville. Lando is a pensioner, and receives one of the biggest pensions paid out to a city of Chico employee since the death of his predecessor Fred Davis. Of course Lando Man wants CalPERS to be funded.
Lando was the guy who floated an MOU in the early 2000’s to attach city salaries to revenue increases “but not decreases“. Ring discusses such measures. We’ll discuss that later.
3 – “Create a Pension Rate Stabilization Program (PRSP): Establishing and funding a local Section 115 Trust Fund can help offset unanticipated spikes in employer contributions. Initial funds still must be identified. Again, this is an option that may work for cities that are in a better financial condition.”
Back to #1. Despite claims that they are in poor financial condition, both local agencies have established such programs, and have been siphoning money that should have gone into maintenance and capital projects to “step up their payments” into their pensions. That leads to # 4.
4 – “Change service delivery methods and levels of certain public services: Many cities have already consolidated and cut local services during the Great Recession and have not been able to restore those service levels. Often, revenue growth from the improved economy has been absorbed by pension costs. The next round of service cuts will be even harder.”
That’s where I had to stop reading for about a week, I felt like my blood pressure was going to blow my eyeballs out of my head. This is the evidence, I mean, we all knew it. This is where they admit it. ” revenue growth from the improved economy has been absorbed by pension costs.” We’ve been lied to – the economy has been improving but the public employees have been stealing all the money for their pensions. And now, as Chico Assistant Manager Chris Constantin has been threatening in his presentations, “The next round of service cuts will be even harder.” You know it and I know it – they’ve been screwing us on purpose. Think Bridgegate.
5. “Use procedures and transparent bargaining to increase employee pension contributions: Many local agencies and their employee organizations have already entered into such agreements.”
Ring says, “(reading between the lines) – MAKE BENEFICIARIES PAY MORE. Good idea. The League of California Cities might expand on the feasibility of this recommendation and provide examples of where it actually happened (cases where employees agreed to pay more towards their pension benefits but received an equivalent pay increase do not count)”
Yeah, cases where employees agreed to pay more towards their pension benefits but received an equivalent pay increase do not count. Ann Willmann of CARD and city of Chico management have all been given raises to more than cover their “extra shares”. And now, only now, “classified” CARD employees (management) pay 8%, and PEPRA (essentially, non-management employees) only pay 5.5% of the total agency contribution of 14%. City employees pay confusing shares, covered below.
The Public Employee Pension Reform Act (PEPRA) supposedly requires all employees pay 50% of agency costs. CARD “classic” staff has agreed to pay 1% more. I don’t know why CARD PEPRA employees are only paying 5..5%, they may still be phasing in.
City of Chico employees have a totally different set-up, which confirms that the individual boards and employees have a lot more to say about this arrangement than either Chris Constantin or Ann Willmann will admit.
I asked City Finance Mangler Scott Dowell (formerly with CARD, there’s just so much footsie in local government) what the shares were. According to Dowell, the city pays different amounts for “miscellaneous” (everybody who is not a cop or firefighter) employees and “public safety”, as well as “classic” and “PEPRA”. Pay attention.
While CARD pays 14% total on all employees, City of Chico pays a total of 21% for miscellaneous classic and 20% for PEPRA. For public safety employees (CPOA, IAFF), the city pays 31% for classic, and 33% for PEPRA. The employer/employee split is as follows:
Dowell says the figures above include a 3% share of “employer cost” paid by employees. That’s confusing. That would make the “employee share” less than half the total cost. According to PEPRA, shouldn’t they just be paying half? Why say they are paying 3% of the employer’s share, and it only amounts to half? And, management (classic) make big yaya about paying 1% of “employer cost” – but PEPRA pay less than the employer share? What the heck?
Dowell also said that CPSA (public safety) employees pay 6% of “employer cost”. What? He says that is included in the figures above. You see, both classic and PEPRA public safety employees pay less than half. And that includes 6% of the “employer cost”? What? Look – fire department classic members are paying 12% to the city’s 18.843% (19%). That’s not 50% of total costs. Do they think we don’t know the math?
So that all leads to the POB – pension obligation bond.
6 – “Issue a pension obligation bond (POB): However, financial experts including the Government Finance Officers Association (GFOA) strongly discourage local agencies from issuing POBs. Moreover, this approach only delays and compounds the inevitable financial impacts.”
Both the city of Chico and CARD have said they will use the proceeds from their proposed tax measures to secure a bond. What kind of bond they have not specified, but I don’t know if they need voter approval to do this. Constantin has suggested issuing bonds for road and street maintenance. Whether or not Contantin is lying, here’s Ring’s analysis:
6 (reading between the lines) – GO INTO DEBT TO PAY OFF DEBT. Pension obligation bonds are at best a dangerous gamble, at worst a deceptive scam. The recommendation itself (above) dismisses itself in the final sentence, where it states “this approach only delays and compounds the inevitable financial impacts.”
Yeah, going into debt to pay off debt. I think the old people called that “robbing Peter to pay Paul.”
Ring makes an interesting observation. “Not everyone wants to blow up the defined benefit system,” referring to the CalPERS’ model of guaranteed payouts.
“I think defined benefit is a tremendous opportunity. It can be sustainable. It was sustainable. And then they jacked up all the benefits by 50 percent and made it retroactive — basically doubled liability overnight. Now, they’re not sustainable. Make them sustainable again.”
Look back to #2 – that’s where Tom Lando, in the early 2000’s, pushed through a “memo of understanding”, getting a weak and stupid bunch of council members to sign off on attaching salaries to revenue increases “but not decreases”. That guy is the head of a very foul smelling fish.
Ring is a good read, he’s written extensively on this crises, how we got here, and how he thinks we can get out.
My grandparents were rice and nut farmers over in Glenn County, where we spent much of our childhood at their “ranch”. My grandma kept a nice yard, lots of flowers, and she couldn’t stand gophers. When we’d find a mound or a hole in the yard, we’d run in to get Gram, and she’d load a round into her old shot gun and follow us out into the yard.
Shooting gophers is a waiting game. Gram would locate the other holes, the “breathers,” and she’d set a hose in one, and then the cats and dog would take up another post, and then my grandma would set the barrel of that Remington right into that main hole. We’d watch, and then we’d wait, and then all the sudden, KA-BAAAAMMM! Gopher bits. And she’d then turn off the hose with a happy “By Gum!”, shoulder her shotgun, and go back in the house.
Sorry for what some people might find a violent analogy, but what I wanted you to get out of it was the patience it takes to stop something from undermining your community and everything you’ve worked for. You have to watch, and you have to wait, and then you have to jump right on it, don’t let up, keep at it until you beat it.
So I’ve been watching Chico Area Recreation District (CARD) and the city of Chico for years now, since about 2012, since Tom Lando, former city manager and consultant who now sits on the CARD board, first floated a survey to determine the voters’ willingness to tax themselves. It came back embarrassingly negative. A subsequent CARD survey came back – “not enough support for a tax measure” was what that consultant said. But CARD kept spending money on consultants, finally going with the company that got the last school bond measure passed, EMC of Oakland. Their first survey was negative, but CARD paid for another just this year, and now they say there is enough support in the community to put a tax measure on the March 2020 ballot.
Really? Well, why didn’t they float a petition? The signatures they gathered would have been proof of people’s willingness to tax themselves. But you know they never would have got sufficient signatures, so they hired a company with money they should have put into maintenance and services to call 400 carefully chosen “respondents” with carefully written questions that would lead anybody to believe they needed to tax themselves. A company that boasts about getting tax measures passed.
I watched this unfold, none of it has been a surprise. And, I been waiting, and I’m ready to stand over their little holes, and hit them with the truth. KA-BAMM! Here’s another round.
Bill Smith says the state has put CARD in a “tough spot”, restricting the agency to raising funds either through program user fees or public indebtedness – parcel taxes and bonds. If he’d listened more carefully, he’d realize that CalPERS and CARD staff and board have put CARD, and the taxpayers, in that spot.
CARD’s General Manager stated at each meeting that staff has deferred maintenance on district infrastructure for years but continued to move money into their “pension liability reserve.” In fact, CARD’s 2019-20 budget shows a transfer of $700,000 into the reserve fund, and a $261,748 “side fund” payment toward their $2,800,000 pension liability. Remember, that’s in addition to the 6 – 9% of salary the agency pays monthly for each employee.
CARD’s budgets show that the revenues they receive from the county – mainly property taxes and development impact fees – are up 8% over the last year. Program user fees are up 9%. New subdivisions currently in the permits process, including those in the Camp Fire burn scar, will bring millions more in development impact fees and new property taxes. These increases in revenue should be sufficient to provide for the future, since expenditures for services and supplies have only gone up 9%.
Meanwhile, salaries and benefits are up 11%, with no new employees. In fact, CARD’s General Manager, who only pays 8% toward a pension of nearly $100,000 a year, received a salary increase at the August board meeting, to $127,000/yr, further increasing the pension liability.
CARD’s current finances are unsustainable, and no parcel tax is ever going to suffice.
I was glad to see some discussion of the CARD parcel tax measure in the ER letters section:
Enterprise Record, 9/1/2019
I attended a CARD meeting about the proposed parcel tax. CARD is in a tough position, the state legislature does not allow them to raise monies via a sales tax or gas tax, its only by parcel tax or user fee. I also understand CARD user fees are probably already at what the market will bear.
What bothers me is the inequality. Roughly half of Chico’s pre Camp Fire populations owns property, they would end up paying the recreation tax if approved. Yet the other half that don’t own property plus the displaced Paradisians that are qualified to vote, get to vote, on a tax they won’t have to pay if passed.
It’s the inequality that I can’t stand, not the recreation fee itself. The state has put CARD in a tough spot.
Bill Smith, Chico
Well, I’m glad to hear somebody is attending these meetings. I’ve been to two and attendance was less than 20 people, including local media, CARD staff and staffers from other local public agencies.
Smith says the state has put CARD in a tough position, restricting the agency to raising funding by way of program user fees or public indebtedness – parcel taxes and bonds.
If Smith attended the meeting then he knows about CARD’s pension deficit – over $2.8 million. He knows CalPERS and the employees have put CARD, and the taxpayers, in a tough position. Willmann stood up there and told us, without batting an eye, that for years now CARD has deferred maintenance on district infrastructure but continued to move money into their “pension liability reserve.” In fact, their 2019-20 budget shows an allocation of $700,000 into the reserve fund, and a $261,748 “side fund” payment to CalPERS. Again, I’ll remind everybody – that’s in addition to the 6 – 9% of salary they pay monthly for each employee.
Mr. Smith should take a look at the CARD budgets for the past few years, available on their website.
He’d see that the agency gets more money from the county every year.
Revenues 2018-19 2019-20 NOTES
RDA pass through $1,090,000 $1,250,000 Redevelopment agency funding, $3 paid for every $1 borrowed
Tax income county $3,045,000 $3,249,000 Property taxes and vehicles fees
Park impact fees $85,000 $80,000 Developer impact funding, restricted to new facilities
Assessments $136,746 $148,881 Fees collected from property owners in newer subdivisions
TOTAL TAX REV $4,356,746 $4,727,881 Increase of $371,135 or about 8%
Program fees $3,479,080 $3,804,255 Willmann says these are adjusted for inflation
Facility Rentals $499,329 $550,988 Includes everything from ball fields to Park Pavilion
TOTAL CARD REV $3,978,409 $4,355,243 Increase of $376,834 or about 9%
You can look at a few more past budgets at their website, you’ll see that revenues increase steadily as Chico grows and property values are high. New development brings fees to cover new parks, and property values continue to rise in older neighborhoods. This should be sufficient to provide for Chico’s growing needs. But as you see below, the more revenues increase, the faster the salaries and benefits eat them up. Even though they still have only 34 full time positions.
Expenses 2018-19 2019-20
Salaries/Benefits $5,700,093 $6,322,852 Increase of $622,759, or about 11%
Services/Supplies $2,071,268 $2,266,348Increase of $195,080, or about 9%
Contributions $15,000 $15,000
Contingencies $25,000 $25,000
Notes payable/leases $1,005 $1,000
What I don’t see on the expenses list is a separate notation for the Pension Liability Trust allocations or payments made out of that special account. I wrote a note to General Manager Ann Willmann asking about that, I’ll get back with whatever answer I get.
Another question I asked Willmann was whether or not the board approved her salary “adjustment” that was on the agenda for the August board meeting.
General Manager Performance Evaluation and Possible Salary Adjustment The Board of Directors will consider General Manager Ann Willmann’s performance over the past year of her employment and any adjustment in salary or other amendment of her employment contract deemed appropriate as a result thereof – Information/Possible Action
I’ll get back to you with that.
The rest of Smith’s letter is not correct.
“What bothers me is the inequality. Roughly half of Chico’s pre Camp Fire populations owns property, they would end up paying the recreation tax if approved. Yet the other half that don’t own property plus the displaced Paradisians that are qualified to vote, get to vote, on a tax they won’t have to pay if passed.”
He’s wrong, even people who don’t own property will pay. This tax will show up on property tax bills, commercial and residential, and landlords will raise rents to cover it. For business owners it will be another expense to pass along to customers.
The real inequality is that it is a flat parcel tax. No matter how large the property or how many units it has, the tag is the same. So the family living in the 1100 sf house on the eighth of an acre lot, renter or owner, will pay the same as the family living in the 2800 sf house on the half acre lot or the apartment complex down the street.
The other point I gathered from looking at the CARD budget is that no parcel tax will ever suffice.
Chico Taxpayers Association 