Archive | February, 2021

Coolidge’s tax increase proposals are the grist they need for their pension obligation bond. Chico cost of living will increase while quality of living will decrease.

28 Feb

This Tuesday Chico City council has an over-full agenda. I notice a lot of the remarks on Engaged Chico question the timing of some of the items, with meetings closed to the public. It seems like they’ve packed the agenda with stupid crap like a Downtown card room, after promising us they’d only discuss “essential business” during the shutdown. 

Nichole Nava sums it up, “This topic and a couple of others should be tabled until the E[xecutive] O[rder] has ended and FULL public participation resumes. Continuing to place items such as this one on the agenda while still under the PHE is not the responsible course of action.”

Hidden deep in this mystery meat agenda are two tax proposals from Andrew Coolidge. Coolidge is proposing not only a sales tax increase for “police and fire,” but a bond for “road improvements.” I feel this agenda has been packed for a reason – they want to distract us from the tax increase proposals they are trying to run under the wire. 

If you read the financial reports attached at the end of the agenda, you see that the city is collecting more revenues every year, and paying more toward the UAL every year. This year they paid out $11.4 million, just in “catch-up” payments, That doesn’t include the regular payroll payments they allocate out of each department budget. But Coolidge wants these measures to guarantee the POB that comes up later in the agenda. All the while the UAL is growing out of control because council has failed to control employee costs.

Hidden even more deeply in the casserole – Item 5.12 – is a request from City Manager Mark Orme (“Staff”) to move forward the Pension Obligation validation process. 

 “Staff is requesting approval to continue exploring the CalPERS Unfunded Accrued Liability (UAL)…”

Well, that’s interesting – “staff is requesting approval…” Meaning, Mark Orme. Orme knows they need that POB before CalPERS ups the ante again. And, he knows they need the sales tax increase and a bond to cover the payments on the POB. This is a desperate scheme, and we’re the ones who will be left holding the bag for this bond. If we don’t approve the sales tax increase and Coolidge’s bond, the POB payments will bottom out our budget. But even if we do approve those new taxes, we will not get street/road repairs, we will not see more police, but the cops and the rest of the employees will be guaranteed their overgenerous pensions. 

Right now the city is bargaining with the Chico Police Officers Association for a new contract. Instead of asking them to pay more toward their generous pensions and benefits, council is turning the stick on the rest of us. The public safety groups – CPOA and the International Firefighters – only pay 15% toward pensions of 90% of salaries exceeding $100,000/year. That’s ridiculous – $15 for every $100 they expect to collect for sitting on their asses in retirement. But here’s the funny thing – they also pay more than any other bargaining group. Management, with the highest salaries, pay the least – 9%. They expect us to pay their salaries now, and then pay them again, with Cost of Living Increase!  

If you haven’t already commented on Engaged Chico

https://chico-ca.granicusideas.com/meetings/354-2-slash-16-slash-21-city-council-meeting-continued-to-march-2-2020/agenda_items/6036bf36f2b6700d2c00a1ad-5-dot-12-pension-obligation-bonds-this-item-added-t

please do. This bond will tank our budget. The sales tax increase and (yet another!) bond on our homes will raise the cost of living in Chico even further, just in case things are expensive enough for you already. 

They raised the cost of our trash service 19% – have you seen any improvement in the street in front of your house? Coolidge is bullshitting us again, just say NO. 

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A gimmick to avoid putting the matter before the voters

19 Feb

I been busy lately, but I knocked out this letter to the editor after I read that article from Mary Walsh. I just can’t believe how stupid that plan is – rent city hall back from yourself? What a scam – who would buy that? Your silly council, and your board of stupes, that’s who! 

Something I couldn’t squeeze in here, is the fact that this money will be paid back at the expense of our city infrastructure.  The “pension fund” they are talking about is filled with a percentage of the payroll from each department – meaning, street money, sewer money, park money, etc. 

Oh yeah, did I mention, the county of Butte is pursuing the same bonds, so get ready to pay out of both ends. 

Juanita’s latest spit on the griddle:

Chico and Butte County are considering revenue measures to pay their pension deficits. Two options presented by consultants are Pension Obligation Bonds and Lease Revenue Bonds. Neither requires voter approval.

David Crane, of UC Stanford, says “Economically, a POB is no more than a ‘carry trade’… borrowing at a low rate to bet on hopefully-higher-yielding assets…”  Crane reports, “When the smoke clears, a POB issuer has the same pension obligations it had before, more debt, has paid investment banking fees, and  gambled the proceeds on products that beget even more fees for bankers.”

New York Times public finance reporter Mary Walsh explained Lease Revenue Bonds in a recent article. “The city creates a dummy corporation to hold assets and then rents them…” Meaning, the taxpayers pay to rent these facilities from the “dummy corporation”.   “The corporation then issues bonds and sends the proceeds back to the city, which sends the cash to its pension fund to cover its shortfall. In turn, the pension fund invests the money raised by those bonds in other assets that are expected to generate a higher return over time.”

A dissenting West Covina councilwoman called this plan “a gimmick to avoid putting the matter before voters, who she believed weren’t likely to approve a deal that would increase West Covina’s debt sixfold.” 

West Covina residents now pay rent on their own libraries, fire stations, even city hall. Who are the dummies here? Contact your district representatives, let them know what you think. 

Juanita Sumner, Chico CA

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West Covina has rented their own streets to themselves. Tucson has rented their own five golf courses and a zoo, while Flagstaff pays rent on their own libraries, fire stations and even City Hall. Chico councilman Sean Morgan has suggested the city should rent Chico Airport to itself. All to pay the outrageous pensions of our elite public employees.

18 Feb

Back in September 2020, I wrote about a Finance Committee presentation from a bond consultant. The city is looking for a new revenue stream to pay down the pensions – instead of just asking the employees to pay a more reasonable share they turn to a tax that will not even come to the ballot. 

https://chicotaxpayers.com/2020/09/21/another-hair-brained-scheme-from-orme-and-constantin-finance-committee-to-discuss-leasing-our-streets-to-pay-the-pension-deficit-no-im-not-joking/

The consultant discussed two options – a Pension Obligation Bond, and “lease revenue bonds”. Neither option requires voter approval.

Pension obligation bonds (POBs) are taxable bonds used to fund the unfunded portion of pension liabilities with borrowed money.  The presumption is that investments will pay the debt service. 

“Lease revenue bonds” involve municipalities issuing bonds (borrowing money) using their own city streets or buildings as collateral to pay down their unfunded pension liabilities. From the 9/23 agenda: “A lease revenue bond structure (leased asset required, such as streets or buildings) would avoid validation process [meaning, the voters] and could proceed on quicker schedule.”

Essentially, a city leases their streets to a special Financing Authority, which will pay the city their up-front money, and “rent” the streets back to the city, in order to pay off the bonds. (Forbes)

And the taxpayers pay the “rent”.  “The municipality will generally appropriate money during each budget session to meet the lease [rent] payment.” (Forbes) These appropriations come at the cost of public safety and infrastructure.

Again, neither requires voter approval. Last month the full council heard the same consultant and voted to have him bring back the fine details, hoping to have this pig in the poke by March. 

The other day I got a note from Mary Walsh, who writes about public finance for the New York Times. Here’s an article she wrote about the revenue lease option. 

The City of Tucson, Ariz., decided last year to pay rent on five golf courses and a zoo — to itself. In California, West Covina agreed to pay rent on its own streets. And in Flagstaff, Ariz., a new lease agreement covers libraries, fire stations and even City Hall.

They are risky financial arrangements born of desperation, adopted to fulfill ballooning pension payments that the cities can no longer afford. Starved of cash by the pandemic, cities are essentially using their own property as collateral of sorts to raise money to pay for their workers’ pensions.

How did they do that?

It works like this: The city creates a dummy corporation to hold assets and then rents them. The corporation then issues bonds and sends the proceeds back to the city, which sends the cash to its pension fund to cover its shortfall. These bonds attract investors — who are desperate for yield in a world of near-zero interest rates — by offering a rate of return that’s slightly higher than similar financial assets. In turn, the pension fund invests the money raised by those bonds in other assets that are expected to generate a higher return over time.

I have to ask this question – given the mess we’re in with CalPERS horrible record of investment returns, why in the hell would we try to play the stock market? Another good question would be, who makes the decisions? Mark Orme? Scott Dowell? Or an investments firm that charges ridiculous fees? 

So, I asked my council representative Kasey Reynolds and will be sure to post her response. I’ll tell you the truth – she has never responded to my inquiries about the Shelter Crisis Designation, so I won’t hold my breath on this one. 

Congratulations Yvonne Johnson, Teri Dubose, Rob Berry, and all you Chico “Fisters” – you got what you deserved for endorsing Andrew Coolidge!

4 Feb

Well, you know I can’t resist saying “I told you so.” Especially when some bully has come and twisted my arm to do what they want. No, I won’t get over Yvonne Johnson’s ugly threat – “you’ll get what you deserve for this endorsement...” That endorsement was Randall Stone over Andrew Coolidge in District 5. 

“I would say the same about your stupid endorsement of Stone! You will get what you deserve for this endorsement. As I understand things, Coolidge was trying to compromise on one particular issue that you didn’t agree with. Stone and his wife make bank on the public dollar. She gets buyback on health insurance, PERS, and a lot of other perks due to Stone’s political position.”

One particular issue? He approved the Shelter Crisis Designation, that was hardly a “compromise,” it was a complete sell-out, and the conservatives, including Rob Berry, were pissed about it. That designation is WHY we are where we are today.  When Coolidge announced his candidacy for the 2020 race, Rob Berry acknowledged that Coolidge had voted with the liberals to institute a “Shelter Crisis Designation.” But endorsed him anyway?  Well, how did you feel Yvonne, at exactly that moment when Coolidge threw his hat in with Huber and Brown to forward that plan to put nearly a million dollars of General Fund money into a hobo camp on the kids’ BMX track at the fairgrounds? 

And let’s not forget Lttle Miss “Clean Up the Camps” Deepika Tandon, who also voted with the liberals.   She actually littered my computer with ads showing hobos and her own picture, face filled with disgust. Now she expects us to give them our Park and Ride? What? 

So, excuse me if I’m laughing instead of crying this morning – the image of Rob Berry and Teri Dubose and the rest of you ugly little fascists with a big splatter of egg on all your faces is just too amusing. You bullies ran an ugly campaign, Dubose funneled 10’s of thousands from the unions into funding Coolidge’s campaign – and now? Neither Dubose nor Berry will fess up to this huge blunder. 

I’m old now, and I don’t really give a  flying fuck at a rolling donut what people think, so cover your ears if you don’t like profanity – FUCK YOU CHICO FIRST AND CITIZENS FOR A SAFE CHICO. You people are a giant joke. Unfortunately you’ve put that joke right onto the rest of us. 

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A simple question: Why would council want to limit transparency of government finances, especially at a time they want a tax increase and a pension obligation bond?

2 Feb

Dave sent me his email to Chico City Council, asking why they don’t tape the daytime committee meetings and post the video on the website. This is the kind of action we need to take on a regular basis if we want accountability out of Council and Staff.

Yes, it looks a little suspicious when they have these conversations at meetings held during the work day, without any recording, and insufficient notes taken by Staff. Here’s another weird thing a lot of people don’t know – before the minutes are even posted for the public, the committee members are allowed to pick and choose what comments are put in the minutes. So, these meetings most certainly need to be recorded for the public. 

Thanks Dave! 

Hello City Council Members,

Currently the finance meetings are conducted via Zoom on a weekday
during working hours and as a result most working people are unable to
attend.  With Zoom these meetings can be recorded and made available to
the public on-line.  Yet staff refuses to record the meetings and make
them available on-line, stating there is no policy requiring them to do so.

Since taxpayers are already paying for Zoom and Zoom has the ability to
easily record and make the meetings available to the public can you tell
me why this is not being done?  Is there no policy and if so why?

Why would you limit transparency of government finances, especially at a
time you want a tax increase and a pension obligation bond?

If you need a formal request from the public for a policy requiring
staff to record the meetings and make them available to the public
online then I formally make that request with this email. Please
agendize an item on the next council meeting to create this policy.

Thank you.