Archive | October, 2021

Bubble Bubble, Toil and Trouble: Chico City Staffers have been trying to foist their pension deficit off on the taxpayers for years now – are you going to bite the ice rink carrot?

18 Oct

Here’s a recent history lesson.

At a 2018 Chico Finance Committee discussion I attended regarding possible revenue measures, a consultant proposed a seasonal ice rink Downtown as a carrot to get the voters to pass a sales tax measure. He said he’d given a Tahoe town the same advice, they’d taken it, and their measure passed.

And so it goes. Council recently decided to spend $400,000 to install a seasonal ice rink at the Downtown Plaza. Just think what that money would look like on the street in front of your house.

The city of Chico funds Chico Chamber, and commissions the Chamber for various studies and reports. A 2018 Chamber of Commerce report recommended that city staff pursue a sales tax measure. Their recommendations for spending the revenues were $3 million to hire more cops, $90 million to fix roads, and $130 million to go toward the pension deficit. At present, council is not being forthcoming with a spending plan. They have proposed a simple majority measure, so they can spend this money any way they want.

A few years ago, the Finance Department staff, on the suggestion of another consultant, instituted a “Pension Stabilization Trust”. Funds are appropriated (embezzled) from each department based on a percentage of payroll into the PST. None of those department funds are restricted, meaning, they don’t have to be spent on sewer or streets or parks or whatever, they can be “allocated” away to pay for any whim of council. In fact, the PST is the only restricted fund the city has. Once the money is in the PST, it’s restricted for use in paying the pension deficit. Once a year the Finance Director makes a “side fund” or “extra” payment to CalPERS – the first year, about $8 million, this year $11.5 million. Staff and consultants have projected that the payment will reach $18 million by 2026. See where this is going? No matter how much they pay, given the ridiculous salaries, benefits, and employee shares – not to mention new hires – the deficit just keeps going up.

There is a faction that is trying to “defund” the police. Well, there you are folks. Make them pay their own benefits! I want good police, but I am uncomfortable with people who say they want to protect and serve as long as they are allowed to enrich themselves with mandatory overtime and an automatic “step increase” salary scale. Kasey Reynolds told me they need to offer these overly generous salaries and benefits to attract good employees, I think she’s got it upside down. Good people don’t hold a town hostage for their own enrichment. This is a racket.

Meanwhile, council has reinstituted the Shelter Crisis Designation, in order to kick children off of a public facility in favor of a tiny house village for transients who will not be served any other way. What ever happened to those days when the county opened the unused buildings at the fairgrounds during extreme hot or cold weather? Now we have a permanent homeless camp at a public property that at present constitutes one of our biggest tourist attractions? Including Andrew Coolidge’s Home and Garden shows – gee, while I’m perusing hot tubs I have to wonder who is breaking into/stealing my car? Screw that, I can buy a pretty spiffy tub online:

I actually owned one of these for years, it was incredible.

Keep those letters coming to the ER, and contact your council reps – remember, always cc the other six.

Mark Orme’s personal pension deficit is over $70,000 – hey little Piggy! Pay it yourself!

16 Oct

Dave (thanks Dave) put the numbers on the 1% sales tax measure proposed by Staff and Council –

That 180 million is going to cost us over a quarter billion. In other words, we will have to pay over 73 million in interest to get 180 million. In other words, the interest will cost us over 40% of the bond.”

That’s over 73 million that won’t go to roads, won’t even go for cops or fire or even the crazy pensions. It goes right to Wall Street. And not the Wall Street in Chico.

Dave added later, “One of those consulting firms the last city council hired said for an average family of four the 1% tax increase would cost them $800 in additional tax a year.

I’ll add, at the present time, the city has no other real debt except the pension deficit, also known as, the Unfunded Actuarial Liability (UAL). They have leases on equipment and vehicles, but nothing approaching the UAL. Last time I asked the Finance Dept for that figure, it was over $145 million. And growing, despite increasing “stabilization” payments.

Those “stabilization” payments are funded by “allocations” from every department, a percentage of payroll. The last payment was over $11.5 million, and the Finance Dept. and various consultants have said that payment will keep going up, projecting $18 million by 2026.

Staff has brought in paid consultants to talk about a Pension Obligation Bond, leasing city infrastructure such as streets – Sean Morgan wanted to lease the airport. They’ve discussed every jackass notion that skitters across their shallow brain pans, but they refuse to discuss raising the employee contributions.

Here are the topics that need further discussion: The California Rule, and Defined Contributions vs Defined Benefits.

The California Rule states that our public employees have been guaranteed certain benefits, and that we can’t go back on those agreements. But here’s the thing – the California Rule doesn’t say we can’t require higher contributions out of employees.

Defined Benefits are the current agreement. That means, no matter what happens with our city finances, we have to pay the pensions – 70-90% of the employees’ highest year’s earnings. A good laywer could easily make the argument that WE didn’t promise these benefits, CalPERS did. They told us they’d make enough on the market to cover the insane pensions. Instead, we keep getting reports of malfeasance and mismanagement – including bribe taking and self-serving investments. They’ve failed to make their target year after year, and raised the city’s contributions as a consequence. Right now, the taxpayers are footing over 30% of the pensions, with the employees limping along at 15% or less. Management, with the highest salaries, pays only 9%.

Defined Contributions – that is what it sounds like. That’s what private sector employees get – if anything. That means, wthe employer (us) promises to contribute a set amount, based on a percentage of their salary. And then they can contribute as much as they want. That’s how 401K’s work.

They have special 401K’s for public employees, called a 457 Plan. Are you ready to be pissed off? In addition to his CalPERS pension, our city manager Mark Orme has negotiated himself a 457 Plan. According to publicpay.ca.gov , in 2020, the city put over $18,000 into Orme’s 457, in addition to over $22,000 toward his CalPERS pension. According to Transparent California, even with Orme’s 9% contribution to CalPERS, that leaves a deficit, just for Orme, of over $70,000. Plus interest fees.

I feel Orme owns that deficit, and should pay it. Or just take less in benefits. With a total salary of over $220,000/year, and a $62,000 benefits package, this guy is greedy pig.

Which will be the subject of my next letter to the editor, stay tuned.

Stop a train wreck before it happens – email Chico City Council and tell them you won’t support a new tax measure until we have a conversation about the employee contributions

12 Oct

I was actually surprised to see this letter from former city councilor Karl Ory. I’m not surprised that Ory is still active with the local Democrats, but I’m kind of surprised he’d attack a sales tax increase measure that he himself proposed while on council. Sure, it’s partisanship – whenever we have a change in the council majority the losers sit along the sidelines throwing eggs.

Letter: Conservatives have bled the city dry

The council proposal for a general sales tax increase is DOA. Conservatives have bled the city dry for a decade and will oppose any tax increase. Just ask Juanita Sumner and the Chico Taxpayers Assoc. But worse, this council has alienated nearly every moderate voice in the city. On their agenda is denying climate change, steamrolling a 1,448 acre development, doing away with the Greenline, and generally kowtowing to their developer benefactors.

Councilmember Morgan’s KPAY broadcasts show he intends to ride liberal bashing all the way to Sacramento. Tax revenues will be used for salaries and benefits; no assurances any will go for roads and creekways. This is just a sham to make them look good.  Afterward they’ll wring their hands and say they tried. Maybe blame the loss on the previous council.

Karl Ory, Chico

Yeah, we all know, the liberals have done plenty of bleeding in their day. They’ve voted right along with the conservatives to approve every new subdivision that’s come before them. They’ve also unanimously approved the employee contracts with overgenerous salary and benefits and unrealistic employee contributions toward the UAL. They all get money from the unions at election time, and many of them continue to take donations from power players like PG&E and Franklin Construction. But Ory is spot on when he says, “Tax revenues will be used for salaries and benefits; no assurances any will go for roads and creekways. This is just a sham to make them look good.  Afterward they’ll wring their hands and say they tried.

Of course the liberals would do same if they had the majority, Ory himself proposed a 1-cent general sales tax increase when he was on council. If you haven’t noticed this pattern before, you just moved here, or you’re deaf, dumb and blind. But I’m not going to squabble over that – when the liberals get the majority again I’ll criticize their poor management. The common thread here is that the money is not going to the roads or any public services, it’s going to service a bond(s). Remember this bit from the 9/21/21 council staff report:

General Obligation Bond
If the City were to pass a general sales tax, the Council could also consider issuing bonds to fund infrastructure, facilities, and equipment. The debt would be repaid over time with anticipated increased
revenues. A general obligation bond would require a two-thirds vote of the electorate to pass.
If the electorate were to pass a bond for infrastructure in the amount of $180,000,000 with interest at a
rate of 3.5 percent over a twenty (20) year period, the annual payment would be $12,664,994
.”

They want to use the sales tax increase revenues to get us deeper into debt. Think about that – not only will they NOT be using the sales tax money toward infrastructure as Coolidge keeps saying, they will be taking another 12 and a half million dollars away from infrastructure to pay off the bonds.

And yes, “bonds”, plural. They want money to pay the pension deficit, having failed in their attempt to make an end-run around the voters with their proposed Pension Obligation Bond.

Read the reports people, don’t just allow yourself to be mesmerized by their moving lips. They are liars, and they will lie to get what they want. Coolidge is one of the most bald-faced liars I’ve ever heard. And the local media just eats it up without question.

I can’t just sit by and watch the insanity, I had to respond to Ory’s letter.

Karl Ory is right, (10/9/21) “Tax revenues will be used for salaries and benefits; no assurances any will go for roads and creekways.” Correct, council has approved a general sales tax increase measure, meaning revenues will go to the General Fund and be spent as council determines.

Ory, a two-time council member, knows that the pension deficit (Unfunded Actuarial Liability) is the city’s only real debt, created by unrealistically high salaries/benefits and unreasonably low employee contributions. He knows that council directed staff to establish a “Pension Stabilization Trust,” into which money is purloined from each department – money that should go toward city services – to pay down the UAL. Recently, council and Staff tried to establish a “Pension Obligation Bond” without voter approval, only the threat of a lawsuit from Howard Jarvis Taxpayers Association stopped them. They told us they’d spend the garbage tax on the roads, but as Ory has also pointed out, the money has gone to the General Fund every year, spent on salaries, benefits, and new positions.

Look at the city budget – the city’s biggest expense is staff, taking almost the entire budget. Where are the services? Last year over $11.5 million went to the pension deficit. But the deficit keeps going up, because council keeps approving unsustainable contracts. Mark Orme created three new positions last year, at salaries over $100,000.

Until we have a real conversation about who owns the UAL, Chico Taxpayers Association will definitely oppose any new tax increases.

Juanita Sumner, Chico CA

Here’s another blurb from that 9/21 report:

  • there will be costs associated with educating the public on the proposed measure (hiring a consultant to conduct such work) and costs associated with placing the measure on the 2022 ballot (such costs will be estimated by the City Clerk in working with the County Elections Office)
  • Yes, the rules for using taxpayer money to run political campaigns are foggy, the FPPC seems to be standing down on this. So, they will be going up your ass with your own money. Let’s try to stop this taxpayer-funded train wreck before it gets out of the station – email your district rep, and tell them not only will you not support this tax measure, but you might just be voting for somebody else when the time comes.

    Council to reconsider Shelter Crisis Designation

    5 Oct

    Tonight Chico City Council will discuss reinstatement of the Shelter Crisis Designation. Remarks made to me by Sean Morgan indicate the SCD will allow the city to suspend general health and safety code and allow “the unsheltered” to occupy just about any city property.

    So, you thought the “Occupy” movement was dead?

    While Morgan denies the SCD will come with new revenues to help deal with this problem, I don’t see anything about that in the report.

    Here’s what I suspect: Morgan and friends are going to set up camp at Commanche Creek and Teichert Ponds. And the report says they can make up their own health and safety code – “please shit in a bag and put it in the trash…” ?

    I feel this crisis has been created by the county and, in some part, by the city of Chico. And they continue to mishandle it. The airport resting site was a joke, and I think several council members knew that, and meant it that way. Jesus Center and Torres Shelter won’t cooperate and the city won’t make them cooperate. Consequently, there are empty beds at taxpayer supported shelters while these people are allowed to defile our public lands. Despite the fact that the city and county both give financial support to these shelters, these agencies refuse to hold the shelters up to their true purpose, which is “getting people off the street”.

    Many of these people have drug or mental health problems. Drugs and drug use are illegal. But Chico PD claim they can’t arrest because Sheriff Kory Honea won’t hold arrestees, claiming the jail is overcrowded. Consequently, DA Mike Ramsey won’t prosecute, and these people are released on their own recognizance into our community. Even those convicted are not supervised – the “failure to appear” charges just stack up.

    This is kind of a fucked up mess. There are a lot of things wrong here. The simple solution is that Chico is not responsible for this problem – no city is required to provide social services.

    I don’t go to meetings anymore, I don’t go to Downtown Chico for ANYTHING anymore. What a shit hole they’ve made of our town. But, the clerk has left Engaged up and you can still join the conversation there. They only allow 500 characters – that’s not words, that’s letters, and even spaces! But I squeezed in the following comment, and I hope you’ll join me.

    https://chico-ca.granicusideas.com/meetings/369-10-slash-5-slash-21-city-council-meeting/agenda_items/6154f373f2b6705afb000624-5-dot-3-declaration-of-shelter-crisis-pursuant

    Butte County collects almost $100 million/year in fees for transfers of mental patients and jail/prison releases from other counties. Mental patients are held for 45 days and then released into our community. The jailer claims overcrowding and releases inmates. The county provides no follow up services or supervision of these people. Failure to Appear charges are ignored. County mental health service centers are only open M-F, 11:30 – 4:30. The county needs to do more, the city is not liable.

    Dan Walters: here’s the truth about Biden’s “infrastructure bill”

    3 Oct

    Sorry, the link loaded twice, but this is a good read. President Joe Biden wants us to believe his $3.5 TRILLION “infrastructure” package is about improving roads, utilities and quality of life for millions of people, but it’s really about undoing one of the good things Donald Trump did. In 2017, Trump got legislation passed that lowered taxes on working and middle income people while lowering deductions and therefore raised taxes on “the rich”.

    As the nation’s most populous state, California obviously has a major stake in what the ultimate package will contain, if there is one. But the state has another, less obvious stake in how it’s financed because of something called SALT.

    It stands for “state and local taxes” and four years ago, a Republican-controlled Congress and GOP President Donald Trump, as part of a major tax overhaul, imposed a $10,000 limit on how much SALT could be deducted on personal income tax forms.

    In a tradeoff, the 2017 tax legislation doubled the standard deduction. The two actions had the effect of increasing federal taxes on high-income residents of high-tax states such as California while lowering the federal bite on low- and middle-income taxpayers.

    The effect – “In California, that meant San Francisco and other Bay Area communities such as Marin, San Mateo and Santa Clara counties. In Santa Clara, for instance, the average tax return with itemized deductions reported outlays of $46,817.53 in state and local taxes, but could deduct just $8,931.28 due to the SALT limit.

    As you’d expect, “Senate Majority Leader Charles Schumer of New York and House Speaker Nancy Pelosi of California have been trying ever since 2017 to undo the SALT limit, and California Gov. Gavin Newsom has publicly supported repeal. That’s why California has a big stake in how Biden’s “human infrastructure” package would be financed.

    But how? Politically, it’s a tricky issue for Democrats, who want to change the limit without appearing to provide a windfall to the wealthy.

    Putnam Wealth Management has published a monologue on the potential ways the SALT limit could be modified or repealed, one of which would place an income limit on restoring deductibility so that those with the highest incomes would not benefit. Other alternatives include doubling or tripling the limit or changing the Alternative Minimum Tax.

    While singing “Eat the Rich,” they are actually planning to put the working and middle income population on the spit. Yet another reminder of The Road.

    Yeah, Lemmy is God.

    2 Oct

    Book in Common, The Road: Who needs fiction? City of Chico getting ready to redeclare Shelter Crisis Designation

    Well, I’ve enjoyed talking about “The Road”. I know it’s a dark book, but you know, I don’t stay interested if I don’t see some hope in a story. I will say, this book ends on a hopeful note. The few characters are very well written, and the plot is well-thought-out and believable. That’s all I will say.

    Cormac McCarthy is a really interesting author, I’d suggest checking out his wikipedia. In fact, I’ll probably read another of his books – “No Country For Old Men.” I’ve seen the movie, and now that I’ve read McCarthy, I’d like to see the book.

    McCarthy has written screenplays for the films adapted from his books, including a 2009 production of The Road, starring Viggo Mortensen, one of my favorite actors. Thanks Dude, for sending me that trailer, my husband and I watched the movie and felt it was a very good interpretation of the book. They even got Robert Duvall to play a short role, a very important part of the story.

    I enjoy reading, especially given the state of our world today, this book was very appropriate. But, so many friends and readers have contacted me lately, pissed off about the city’s tax measure, the skating rink, and now, council is reconsidering another Shelter Crisis Designation, on Tuesday’s agenda.

    http://chico-ca.granicus.com/GeneratedAgendaViewer.php?view_id=2&event_id=369

    The report indicates that Staff is asking Council to redeclare this disaster. I wrote to my district rep Kasey Reynolds and included Sean Morgan because I have spoken to them before. I asked them simply, “So, will either of you be voting to extend the shelter crisis designation, or will this be the end of the shelter crisis designation? Thank you for your anticipated response.”

    Reynolds has not bothered to respond – she wants phone calls, goes all over the place, and then you have no record of what she babbled. At least Morgan responded.

    It’s not an extension. We already eliminated it (that’s my understanding). In any event, it did nothing while we had it, won’t do much if it comes back, but may be necessary for other strategic plans. The City Attorney’s reasoning will be interesting. I assume you’ve already made up your mind?

    I responded, “How much money does the city get for the declaration? No I haven’t made up my mind on this issue yet, because I don’t have all the details. You really shouldn’t assume that you know what people are thinking. I’m guessing you think there’s a mouse running around in my head!”

    Morgan: “No money. That’s not the point.” I questioned him further, and he told me, “So, in order to (hopefully) get the injunction prohibiting us from enforcing our anti-camping ordinances, we may have to do some things we might not normally approve (at least in my case). Some of these things may require the reinstatement of Shelter Crisis because it allows for use of structures, etc. that wouldn’t normally get past state code. A huge double standard you say? Absolutely. Unfortunately, I can only play the cards I’m dealt.

    Actually, there was more to the conversation – Morgan accused me at one point of “condensing”, I think he meant I was being “condescending”, and threatened not to “interact” with me anymore. Frankly, I was being perfectly businesslike, because I know how fast these people can cut you off. It’s not me, it’s him. He’s very defensive. What he’s saying is, they’re getting ready to expand services for the transients. He knows people are going to be pissed about that, and just when he’s asking for a tax increase!

    Frankly, Morgan’s mind may not be entirely made up on this issue. We might be able to reason with him.

    How do you feel? Well, don’t be “condensing,” but contact Mr. Morgan and tell him about it. Tell him what you think of the ice rink too. Don’t use profanities, don’t be threatening or insulting, just give it to him straight. Tell him you think he’s mistaken. Tell him you won’t support any tax increase for a council who spends money like that. Etc. Try your best to be polite, and let him know you realize he’s got a pretty nasty job. But whatever you do, be sincere, and tell him you’re being sincere.

    That’s sean.morgan@chicoca.gov