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The pension deficit is the difference between what public employees expect to get and what they are willing to pay into it

5 Apr

Well, anybody who saw my last post and then saw my letter in the News and Review can see that I had to edit dramatically to get my letter in.  When I sent my original letter to the address I’ve used for years, it was sent back, rejected for size? And I was told to use the form letter mechanism on the N&R website, which only allows 150 words. Snip, snip, snip – I still got my point across, and it was a good exercise. 

Write those letters folks! When do I find the time? When I’m so pissed off I can’t sleep. Writing letters to the editor will save your teeth, believe me!

I sent the following letter to the Enterprise Record two days ago, watch for it, and write your letters too. Just yesterday Dan Walters ran a column about the spending of taxpayer money to pass revenue measures that will only end up being squandered on the pension deficit –

https://www.sacbee.com/opinion/op-ed/article228799774.html

so people are thinking about this subject. Write now!

And don’t just write to the papers, forward to the city manager mark.orme@chicoca.gov and CARD general manager Ann Willmann annw@chicorec.com

Chico Area Recreation District board and staff have spent over $100,000 on consultants to help them pass a revenue measure  but have yet to show the taxpayers that they can be trusted with money.

In 2014, CARD staff reported a pension deficit of $1,700,721 .  Only five years later, that deficit has ballooned to $2,800,000, despite nearly $1,000,000 in “side fund payoffs”.  

CARD staff announced they have “set aside” another $1,700,000 for payment toward the  deficit, having admitted they have deferred maintenance to various facilities for years, including Shapiro Pool, which was closed permanently last year.

CARD only started asking employees to pay toward their own pensions in 2013, but management staffers pay 6% or less, with the general manager paying only 2 percent of an $108,500 salary.

CARD staff describe the pension/unfunded liability as “What we owe to CalPERS because of the difference in their guesses.”

Wrong.  The pension deficit is the difference between what employees expect to get (70 percent of their highest year’s salary at age 55) and what they want to pay for it (less than 10 percent of their salary). For example, the general manager pays $2170/year toward a pension of  more than $75,000.  That is not sustainable.

CARD staff have used taxpayer revenues to enrich themselves while ignoring their mission. Now they tell us we need to pass a revenue measure, or they will further defer maintenance, close facilities, and cut programs. At the same time offering a grandiose new sports facility south of town? Let the board of directors know how you feel about that, at annw@chicorec.com

 

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Book In Common: PLUNDER! How Public Employees are Raiding Treasuries, Controlling Our Lives and Bankrupting the Nation, by Steven Greenhut.

25 Jan

I’d been waiting over a week for a book I’d ordered online that should have been delivered within a couple of days. I kept checking my PO box, by this past Monday, I worried it had got lost. Yesterday it finally arrived – well, I got it yesterday. I’m guessing it arrived at Chico post office about a week ago.

It was too big for my PO box, I know the routine – they put a key in your box that goes with one of the big boxes in front of the annex. I retrieved the package from the big box and immediately noticed – a postal worker had scrawled a box number in big black letters across the front of the package, unfortunately, it wasn’t my box number. My correct box number was listed in the address box on the front of the package, neat and tidy.  Postal worker transposed the numbers, in big black writing, so the key went to somebody else’s box.

Here’s where human decency comes in. Somebody else got my package, saw it wasn’t for them, and put it back in the stream. They may even be the same person who wrote the correct number above the transposed number. 

When this happened at my house, my neighbors got my packages. Both packages were clearly marked with the correct address, but mail man delivered them to my neighbors. Neither neighbor bothered to return the package to my clearly marked box on the street, both opened the packages, even though they were addressed to someone else. We got the packages back because my husband went door-to-door. 

Neither neighbor apologized for opening our packages, we let it go and stopped having stuff shipped to our home. 

Of course Christmas is a horrible time to get or send packages, we all know that. But I order a lot of household goods from an online seller in Vermont, and I had to have some stuff delivered in the first weeks of December. Right in the middle of the flood of evacuees driven out by the Camp Fire. But my package had a tracking number, I watched it move slowly across the US, and then I saw it had been delivered to Chico Post Office on Vallombrosa. But it wasn’t in my PO box, I kept waiting. Finally I went in very early one morning to ask for it. The man who called me up to the counter wouldn’t take the tracking number I’d written down, or look at the message on my phone that said the package had been delivered. He turned and disappeared into the back – which was a mess of packages laying all over the floor – and when he came back 15 minutes later he said there was no package. 

I looked him in the eye and shoved the tracking number at him and said real nice but firm, “please check the tracking number.”

He was huffy but he took the slip of paper. This time he was gone for 10 minutes, but by Gumm, he brought me my package. I wanted to give him a piece of my mind but the line behind me was starting to go out the door, so I said Thank You! with a big shit-eating grin and got the hell out. 

My family has received Christmas packages that have been ripped open, stolen from, and taped back together, so I  guess I was lucky to get my package intact.

Now the book, mis-marked by a post office employee. I’m getting sick and tired of the level of service we get from public workers. We bought a house in Paradise in exchange for an old rental we sold in Chico. My son was living in it at the time of the fire, luckily he had gone to work before the fire had hit town, and was safe. I’m thankful for that, but dealing with the county in the aftermath hasn’t been the least of our worries.

We were quick to send in our ROE – Right of Entry – so the county could get going with the clean-up. I understand the clean-up will take a long time, but when we didn’t hear anything about our ROE, I e-mailed them asking if it had been received. A fellow named Matt called my husband a few days later in response to the e-mail, saying we needed to submit a new insurance declaration from our policy, the old one we sent had expired when our policy turned over recently. They knew that for over a month, but didn’t contact us until we inquired about it. Is that going on all over Paradise?

And then yesterday we received a packet, sent in a custom “Butte Recovers” envelope, with  custom stationery inside, a letter telling us how important it was to complete the ROE form. They had included the entire form, over half a dozen pages. The letter was not addressed to us, it was a form letter, so I’m guessing they sent one to each and every address that had burned in the fire. 

How much did that cost? At 50 cents a letter? I’m guessing at least a few thousand bucks. Not to mention the custom printed stationery. How about $taff time, folding all those papers and shoving them in those envelopes, then running them through the stamp machine?

Here’s the irony I’ll leave you with – the book I ordered – PLUNDER! How Public Employees are Raiding Treasuries, Controlling Our Lives and Bankrupting the Nation, by Steven Greenhut.

Think the post office workers knew what was in my package? 

I’ll describe Greenhut as a government watchdog, journalist, and public advocate. His articles have appeared in papers like the Orange County Register, LA Times, San Diego Union Tribune. This book was written in 2009 – before I started blogging about what’s going on in Chico, before I ever even heard of the pensions. So, it’s history for me, finding out exactly how public employees garnered their power and position. 

I’m calling this our BOOK IN COMMON, if you’d like to get a  copy, I bought mine used for 99 cents, cost $3.99 to ship. It’s in great condition, and so far I’ve enjoyed reading the forwards by Congressman Tom McClintock and Mark Bucher, who co-authored a late-nineties attempt at requiring unions to “at least ask members before using their money for politics…”

So come on along, learn some recent history, maybe find out what needs to be done to turn back the tide of entitlement that is drowning our state.

Don’t be fooled – City of Chico’s proposed tax measure is all about the pensions

21 Jan

The city of Chico is ramping up their tax increase campaign, with city staffers soliciting the news paper for stories about funding shortages, and lately, using the Camp Fire as an excuse to seek a revenue measure.

https://www.chicoer.com/2019/01/15/theres-been-more-traffic-in-chico-since-the-camp-fire-and-thats-not-changing-anytime-soon/

No mention of the dramatic uptick in home sales and how the outrageous price increases will affect property tax valuations. No mention of the effect that 29,000 people swooping down on your retail sector is going to have on sales tax revenues. No mention of what full capacity motels will contribute in “Transient Occupancy” or “bed tax”. Property, sales, and TOT are three of the four biggest revenues our city receives. The fourth is Utility Tax, and that’s going up with increases in PG&E rates. It’s a win-win all the way around for City of Chico, but they cry poormouth and want a revenue measure.

Stand up people, and let them know what you think of this attempt to embezzle more taxpayer money into their own pockets. I sent the following letter to the Enterprise Record this morning. 

City staff says traffic congestion and accidents are up in Chico and asks more money for road improvements, police and fire staffing. Despite an unprecedented increase in property tax valuations, sales tax receipts and TOT due  to Camp Fire evacuees, council has directed staff to look into putting a revenue measure on an upcoming ballot.

Dan Walters opines most local revenue measures are “all about the pensions.” I agree. The mayor of Capitola admitted, “ if we put a measure across for pensions it would be doomed for failure immediately”, so their November ballot measure read “to help fund youth programs, protect parks, beaches and open space, and support local businesses.”

Pension liability is the difference between what is paid into the California Public Employee Retirement System, and what employees expect to get in retirement. City of Chico employees pay less than 10 percent of their pension cost, while the taxpayers pay roughly 30 percent. That leaves the city an unfunded liability of over $129 million.

In 2018 city staff made a $7,598,561 annual payment toward their pension liability. Part of that money is allocated from each department fund, based on total department compensation. The rest of the annual payment is allocated from the General Fund.  Council approved allocations are how they transfer money from one fund to another in order to avoid spending restrictions – like spending public safety or road funding on their unfunded pension liability.

Despite any promises to the contrary,  the city’s proposed revenue measure is all about the pensions.

Juanita Sumner, Chico

 

Here’s how the city hides payments toward the pension deficit

18 Jan

I got the agenda for next Wednesday’s City of Chico Finance Committee meeting – if you want to know how your money is being spent, these are worth a read:

http://www.ci.chico.ca.us/government/minutes_agendas/documents/1.23.19FinanceCommitteeAgendaPacket.pdf

The agenda includes the Finance Department’s monthly report – make yourself read through the gobblety-gook of numbers and acronyms, it gets easier to pick things out. Use Google search for any term (including acronyms) that you don’t understand. 

I like to scan down and look for certain things – I like to see where revenues come from, I like to see where they’re spent. They move this money like peas under nut shells – certain funds are restricted to certain uses, but somehow they manager to “allocate” money from one fund to another, and then they can spend it the way they please.

You need to remember this when the city starts talking about their revenue measure. Right now the talking heads – including members of the public that have too much influence over council – are arguing between a sales tax increase measure and a bond. Whichever way they  go, they will need to decide between a “special” tax and a “general” tax. Currently, a “special” tax requires 2/3’s voter approval, while a “general” tax only requires a simple 51 percent. 

But it doesn’t really matter in the end, because once they get the money, they can “allocate” it right into their own pockets. 

Look at the report and watch for the word “pension”. Right away I find “CalPERS UAL payment” – that’s for the unfunded pension liability – the difference between what public employees have paid for their retirement and what they expect to get. Last May city Finance Director Scott Dowell informed the Finance Committee that the city’s UAL is over $129 million. 

The UAL payment is made once a year. This payment is separate from the regular pension payments made monthly – those are mushed in with salaries and benefits, you’d have to ask Dowell exactly what the city pays per month. 

The 2018 pay out for the UAL is $7,598,561. That’s seven million, five hundred and ninety-eight thousand, five hundred and sixty-one dollars. Say it out loud a few times, you pay for it.

Because this money doesn’t come from the employees. They pay anywhere from two percent to nine percent of their monthly pension costs. The taxpayers float another 25 – 30 percent. The rest makes up the floating liability. Here’s how the city of Chico transfers this liability onto the backs of the taxpayers.

When I asked Scott Dowell where the money for these payments comes from I got the following answer:

Fund 903 has two inflows:

1.       Each City fund that has payroll is charged a percentage of payroll for the applicable share of the estimated annual unfunded liability payment.  That amount is transferred to Fund 903 from each applicable fund.  These transfers are used to pay the annual unfunded liability payment to CalPERS out of Fund 903.

2.       The second inflow is a direct transfer from the General Fund to the Fund 903 approved by the City Council.  There was an initial transfer from the General Fund to Fund 903 of $541,455 for the year ending June 30, 2017.

Let’s look at that.

1.        this is how they hide the payment – “transfers” – they take payroll money. Look at the budget, you see “salaries and benefits” in each department’s expenditures, nothing about paying down the UAL.

2.        and there it is – “a direct transfer from the General Fund  to the Fund 903 approved by the City Council.”

The General Fund is a cookie jar with no restrictions. I’ve sat at meetings and watched money being transferred from other, restricted funds, into the GF, so they can spend the money the way they want. This is “allocation.” 

So when they tell you a  tax measure will be devoted to “street maintenance” or “public safety,” here’s what that means. 

  • CalPERS unfunded pension liability payment for 2018 – $7,598,561.00
  • Roughly half goes to “Safety” (cops and fire) – $3,660,240.00
  • An increase over last year ($6,547,673) of $1,055,888.00

 

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Get out of CalPERS, dump the pensions, clean house on management Downtown and hire people who will pay their own freight

16 Jun

Out running errands around Chico the last few weeks, I’ve been seeing the usual parade of transients is on the increase. They come from South Chico in the early morning with their bikes and trailers, shopping carts, backpacks, many of them toting a bunch of garbage bags, full of recyclables they’ve stolen out of residents’ recycling bins. There’s a real exodus on trash days in my neighborhood – we have our trash picked up on Thursday and then the trucks come on Friday to do the other side of the street. The bums follow the trash trucks along to rifle through the recycling bins. They know the recycling doesn’t get picked up until all the trash bins are emptied, because Waste Management doesn’t have enough trucks to do both at the same time.

We’ve seen them sprawled all over sidewalks, bus stop benches, commercial medians, you name it.  The little “parklet” at the intersection of Mulberry and Pine/Cypress, along Little Chico Creek, was becoming a de-facto transient camp, with more transients out of sight under the bridges and along the creek banks. And then yesterday we noticed, the cops were rousting them in force along the creek, with two cop cars and a ranger’s vehicle. Then we noticed – no more camps at the parklet.

I realized, this is what Mayor Sean Morgan was telling me about when I complained about the incident in front of my house.

https://chicotaxpayers.com/2018/05/20/want-the-bums-out-of-your-recycling-cans-sheds-garages-cars-stop-putting-crv-in-your-bins-donate-it-to-the-work-training-center/

Morgan told me in a May 19 e-mail, “next week PD team normally assigned to South Campus area is heading into the parks.”

But wait, before you think the city is actually moving to solve a problem, read the agenda for this coming Tuesday’s meeting.

http://chico-ca.granicus.com/GeneratedAgendaViewer.php?view_id=2&event_id=290

Councilmember Ory has submitted a request for the Council to consider agendizing the Chamber of Commerce recommendation for a revenue measure to increase police staffing and improve roads.

But Ory left something out –  read the chamber report –

https://chicotaxpayers.com/2018/05/24/chamber-special-report-3-million-for-more-cops-90-million-to-fix-roads-130-million-for-the-pension-deficit/

They want $130 million to pay down the pension deficit. Only $3 million for cops, $90 million for roads – but $130 million for pensions. Who does Ory think he’s kidding?

Although, sometimes I wonder about Ory. I stood in line behind him at my bank ATM machine when he was a candidate. He had 5 people waiting while he unsuccessfully tried to figure out how to use the machine, and rather than step aside, he just pretended we weren’t there. Every time I’ve been near him, he’s acted completely senile, including at a meeting he was chairing, when I told him a question posed to staff had not been answered. He tried to tell me that I could only make one “comment” per meeting? I had to repeat myself a couple of times over his protestations, before the speaker just interjected and answered the question.  So, I couldn’t tell you for sure, whether Ory is nuts, stupid, senile, or really expects all of us to buy into his crap.

But, I do know, Chico PD can suddenly enforce laws they haven’t enforced for the last year. Why? They’ll tell us they spend most of their time hanging around campus when school is in, that they don’t have time to do anything else. What a crock.

Don’t buy into their sales tax increase pitch. They act as though we have no other choice than to pay their blackmail.

The best choice would be, get out of CalPERS, dump the pensions, clean house on management employees and institute the new 401K system where employees pay most of it.  

 

 

 

Chamber Special Report: $3 million for more cops, $90 million to fix roads – $130 million for the pension deficit?

24 May

Chico Chamber started marketing their proposed sales tax increase measure five years ago. Below is the link to their “Special Report,” the product of five years of committees, task forces, clandestine surveys, and other ploys recommended by various consultants. 

Below is the link to their “Special Report”.

They list four “priorities for Chico – “police, roads, pensions and fire.” Don’t let the order in which they are listed fool you – that’s not indicative of priority. $3 million for the cops, $90 million for roads, and $130 million for pensions. 

The report summary says the Chamber would like to get the public involved in the discussion, but given the way Katie Simmons has scheduled the “community meetings,” there really hasn’t been much public participation – mostly Chamber and City officials. 

The Chamber wants a sales tax increase to pay for all this stuff. Do you really want to pay for the pensions? You’ve already paid more than the employees. 

Read that “special” report here:

http://chicochamber.com/public/uploads/CC_January_Special_Report_FINAL.pdf

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City exploring pre-funding of pensions – do they ever do anything Downtown besides figure out ways to pay themselves?

16 May

Finance Committee meeting Wednesday, May 23, 2018 – 8:30 a.m. to 10:30 a.m.  Council Chamber Building, Conference Room 1

Committee members – Councilmembers Morgan (sean.morgan@chicoca.gov), Stone (randall.stone@chicoca.gov) and Chair Sorensen (mark.sorensen@chicoca.gov)

Next Wednesday the committee will hear reports regarding a fairly new scheme for skimming money off the taxpayers to fund employee pensions. Below is an article from Public Agency Retirement Services (another public retirement agency?) describing the benefits of this program. 

http://www.pars.org/2016/03/a-new-tool-for-pension-budgeting/

With our maturing public pension plans, we know that we should expect greater fluctuations in required contributions from year to year. And since we know big fluctuations are coming, our actuaries are warning employers to plan for it in order to ease the burden when big contribution increases do arrive. But how exactly does one do that? It’s not like big portions of your annual budget are discretionary spending.

If you’ve been in the position of sitting on extra cash, you will have quickly learned that there’s little you can do with that money to “prepare” your agency for fluctuating contribution requirements. If you give that extra money to CalPERS, CalPERS will apply it toward your unfunded liabilities, and it will probably make only a small dent in your annual required contributions due to their amortization rules. While paying down unfunded liabilities is always worthwhile, it won’t help you manage future year-to-year changes in required contributions. You could stash some cash in a rainy day fund, but that has its drawbacks as well. The good news is: we’ve got an answer for you. Duh, dah, dah, duh…. The Section 115 trust!

Here’s something funny – “ If you give that extra money to CalPERS, CalPERS will apply it toward your unfunded liabilities, and it will probably make only a small dent in your annual required contributions due to their amortization rules.”

Current city finance wizard Scott Dowell worked for Chico Area Rec Dist before he got the job with the city. He made those “small dent” payments toward their pension deficit – a “side fund payment” as he described it, of $400,000 in one year. That money could have gone toward badly needed repairs at Shapiro Pool – a consultant said the pool could have been brought up to code for less than $500,000 – but Dowell told me the agency saved a lot of money! by making that side fund payment instead. That’s like making interest only payments on your credit card.

This man gets paid almost $200,000/year, in salary alone, to make decisions like this. And when they’re bad decisions, well, gee, he just changes his MO!  And gets a raise and more for his benefits package.

So you have almost a week to write to the fellows on this committee – that’s Seanny, Randy, and Mark-e-Mark – and tell them what you think of Dowell’s little schemes to fund his own pension. 

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