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Chico since Nakamura, Orme and Constantin – do you feel “healed”? Or “heeled”?

12 Nov

Chico disaster timeline – rough montage of the last 8 years of city management, or, mismanagement?

Sept 2012 – Nakamura hired from Hemet – Hemet was shocked, said Nakamura had not told them he was looking for another job

Jan 15 2013 – Asst City Manager John Rucker’s “sudden departure” https://www.newsreview.com/chico/content/sudden-departure/8827217/

Mar 7 2013 – Nakamura hires his former asst mgr from Hemet Mark Orme – from the above article – “This week the Chico Enterprise-Record reported the story and also published in its classified section an ad for the position. The ad says the salary offered for assistant manager is $142,652 per year with the potential to reach $172,382 based on performance. The ad refers to the city website for more information.”

[EDITOR’S NOTE: 7 years later, as of his resignation, Constantin was making $189,000+ as Asst City Mgr. Let’s see what council intends to pay his replacement]

Mar-Apr ? 2013 – Jennifer Hennessy resigns as finance director – “As the city’s finances worsened, Hennessy was often the target of sharp criticism from some council members and agenda-driven citizens. ” CN&R article link below

April 16 2013 – Nakamura hires former Hemet employee Chris Constantin from an auditor position in San Diego “

“In an interview prior to the council meeting, the 37-year-old Constantin talked about his decision and the controversies he is escaping in San Diego, where he’s served as assistant auditor since 2010.”

https://www.newsreview.com/chico/content/money-man/9619285/

“I made a three-year commitment in San Diego that was up in February,” he said. “At about that point I wasn’t really happy because I wasn’t feeling appreciated.”

[EDITOR’S NOTE: Read the N&R article – Constantin left San Diego with a shit storm at his heels.]

May 28, 2014 – Nakamura leaves https://www.newsreview.com/chico/content/so-long-nakamura/13622217/

““It caught us a little bit off guard,” said Mayor Scott Gruendl, who received Nakamura’s resignation letter last Wednesday (May 28) during a breakfast meeting.”

“When Nakamura arrived in September 2012, the city was in a bad place financially and it was his job to fix it. About six months into his time in Chico, Nakamura laid out his three-part plan to Gruendl. Part one was to identify the problems. Part two was to put a team in place to remedy those problems. Part three was to step back and allow the town to heal.

“He pulled the covers back on stuff, and also came up with responses on how to deal with it,” Gruendl said. “That meant a lot of layoffs, unfortunately. What was devastating for a lot of people is how many people we had to let go. Each time, it was more seasoned and experienced people, and it got harder. There was no good way to reconcile that.”

“He’s the lightning rod for the hard decisions that were made—the significant number of layoffs that we did, the collapse of 11 departments into five, the actual moving out of key management people who, for no better explanation, blatantly fucked up,” Gruendl said. “We had people who had good intentions but really didn’t know what they were doing. Brian dealt with it.”

“But the drastic reorganization of city departments has certainly left some with a bad taste in their mouths. Layoffs included many employees who had dedicated years—decades, even—to the organization, and key positions were eliminated, leaving things like the city’s trees untended.”

June 3 2014 – Orme appointed interim city manager

Same article – “Looking forward, Mark Orme—who was promoted from assistant to interim city manager at the City Council meeting Tuesday (June 3)—said he’s excited to work with Chico to begin the healing process.

“There’s been a lot of pain and heartache. That takes time to heal,” Orme said. “There are also external challenges. There’s been a lot of impact on the community financially as it relates to community organizations and a lot of the norms Chico was used to.”

[EDITORS NOTE: “the norms Chico was used to…” What the hell did he mean by that? If you lived here before 2013, let me ask – do you feel “healed”, or “heeled”?

Letter to the Editor: City services will never be adequately funded until employees start paying their fair share

28 Oct

Dave was reminding me the other day (thanks Dave), elections come and go, but the suits are always working on  tax increases. It’s true, elected officials are here today, gone tomorrow, but The Song Remains the Same – City of Chico Staff is always trying to  find a way to  get us to pay their outrageous salaries and  benefits, without providing us with any services. 

I thought BC really wrapped it up good when he said, “Chico taxpayers… are guaranteeing the generous salaries and benefits of well heeled, well paid, privileged city employees.”

So, I wrote a letter to the editor about it! I borrowed generously from BC’s remarks made a week or so ago here, I hope that’s okay BC! I did change your comment about “average income” to “median family income” because that’s the only statistic I could verify. Still works. 

At my blog, chicotaxpayers.com, we’re discussing the Pension Obligation Bond currently being considered in closed door meetings Downtown.

CalPERS promises to fund the pensions with a 7% investment return, but have not met that target, forcing city of Chico to dip into the General Fund to make increasing payments. That’s right – Chico taxpayers, with a median family income of $43,000/yr, are guaranteeing the generous salaries and benefits of well heeled, well paid, privileged city employees.

A Pension Obligation Bond must  be paid ahead of everything else, at the expense of city services. In the event of a bad return, the bond holders can take our entire General Fund. 

To use a credit card analogy: The City has run up so much credit card (pension) debt, they can’t even make the minimum payment. So while they keep spending at the same or greater rate (hiring three new management positions this year), they mortgage the house to pay down the credit cards. They can’t afford to keep the house up (deteriorating municipal facilities, parks and public areas), can’t fix the driveway (deteriorating streets), can’t afford a security system (fire and police), and eventually can’t afford to put food on the table for the family (homeless).

City services will never be adequately funded until employees start paying their fair share.

Tell Mayor and Finance Committee member Ann Schwab what you think, at ann.schwab@chicoca.gov

Juanita Sumner, Chico CA

POST SCRIPT:  I’d also like to see Mark Orme fired, but maybe if we apply enough heat to the seat of his pants we can just make him quit. 

 

Contact Mayor and Finance Committee member Ann Schwab and tell her what you think of Mark Orme’s snake oil scheme to put his pension debt on the taxpayers

28 Oct

I got a great comment from Emily this morning. It was good to hear from somebody, besides me, and Dave, and BC, who is worried about the city’s intentions to foist a Pension Obligation Bond on the taxpayers, currently being discussed in closed meetings.

“Thanks for publishing all of this. I live in District 3 and asked both Denlay and Schwab (I do not consider Breedlove a serious candidate) about their plan to deal with Chico’s unfunded pension liability. Schwab emailed me back immediately with the same response she said she had already sent to you: best way is to make sure businesses can thrive here by improving infrastructure etc, state’s payment requirements are unrealistic and Chico is advocating for change, city has a pension stabilization trust w which to grow its payment funds, and city is considering a pension obligation bond though there’s “some debate” whether those are beneficial.

Thank you again Emily, for taking time to engage the candidates. I had a discussion with Ann, and tried to contact Denlay, who never got back to me.

I’ll give Ann credit – she responds, and she’s honest. But I have to differ with her statement that the state’s requirements are unrealistic. Schwab and her full council signed contracts allowing over-generous salaries and unrealistic employee contributions, and now she says it’s CalPERS’ fault?

Furthermore, she admits there is “some debate” over POB’s being “beneficial“. That’s an understatement, given the warnings the consultant made about the volatility of such bonds. Why would these investments fare any better than CalPERS’ investments, which have been coming in at half or less than their projections? The consultant made it clear – poor returns, which he also said repeatedly are very likely, would be a disaster for the city. The bond holders would take our entire General Fund. That’s about all we have left, besides the already established “Pension Stabilization Slush Fund”.

And, I don’t think the consultants were being fully honest about the streets leasing deal, I think that’s even more risky than they are willing to admit at this stage.

Denlay’s response to Emily was worse.

“I had to follow up with Denlay, who did respond with her ‘instincts’ about how to deal with this problem: get diverse stakeholders together to understand the problems as a whole before working on a solution, need to get different stakeholders to agree on a plan to pay it down within 30 years, but that Chico has ‘many pressing issues even beyond pension liabilities,’ including illegal encampments, needle handout programs, and the state of City Plaza.”

That’s what I’ve been saying about Denlay – she is way over her head. She doesn’t understand that the pension deficit is the biggest debt the city faces, that it is being paid by the taxpayers at the expense of all our city services, and if we don’t do something about it, we’re in for BANKRUPTCY. Worse, she obviously didn’t watch the consultant’s presentation, which is just plain LAZY, girlfriend. The first thing I look for in a candidate is their knowledge of the committees. I’m going to guess she doesn’t even know what committees or who is sitting on them.

But she has been tutored about the POB, because a reader sent me the response he got out of her. That’s what she’s talking about when she says “get diverse stakeholders together to understand the problems as a whole before working on a solution, need to get different stakeholders to agree on a plan to pay it down within 30 years.” The operative word here is “stakeholders” – is she including the taxpayers? Because the consultant also made it very clear that this bond will not go to the ballot, meaning the taxpayers are out of the conversation.

Emily added, “I’m at a bit of a loss bc I can’t believe Schwab is even considering the pension obligation bond, but it doesn’t look like Denlay understands the issues very well.

Thank you Emily, you put it in a nutshell.

But, I’ll still say, at least Schwab is honest, and she responded more clearly. I’ll also tell you something else about Schwab – she wants to get re-elected, I believe she wants to hold onto her seat until she is termed out, so I believe she listens to criticism better than most.

So, it’s time to contact Schwab – she’s not just the District 3 candidate she’s your mayor, and a member of the Finance Committee that is forwarding a recommendation to Council. Tell her what you think of this insane idea.

Tell her you know the sneaky, dirty truth that Mark Orme doesn’t want us to know. This isn’t the kind of bond that shows up on your property tax bill. It’s the kind of bond that drains city finances, written to be paid ahead of any of our other debt and ahead of financing services. This POB will show up in the form of PUBLIC SAFETY SERVICE CUTS, UNMAINTAINED STREETS, A FILTHY PARK, AND HIGHER SEWER FEES.

And there’s the next thing that will show up on the horizon – another tax proposal. They’ll let the streets go to crap, the park will remain a giant hobo camp, and you will continue to see “quality of life crimes” without any response from the cops. When they think we’re about up to here with it, they’ll offer another tax increase. They’ll tell us it’s for the streets and public safety. Oh yeah, remember – just like they told us the Trash Tax would go to the Street Fund. The truth is, they’ve voted year after year to put it in the General Fund, out of which they make their 7-8-9-10-and now 11 million dollar UAL “catch up” payments.

So tell Ann you’re hip to those kind of tricks. Yes, we need to address the pension deficit, head on. Meaning, THE EMPLOYEES, ESPECIALLY MANAGEMENT, NEED TO PAY MORE. And they need to do it without the raises council has given them every time they’ve agreed to pay more of their pension – how asinine is that?

That’s ann.schwab@chicoca.gov

No on Measure E; and there will be a quiz later today about that Finance Committe meeting!

16 Oct

Wow, who would have guessed Measure E – city council districts – would be such a hot topic. Looking at the stats the last week or so, that’s what people have been hitting – “Measure E – Divide and Conquer”.

In the music business, they would call that a “throwaway piece.” I was just annoyed and frustrated over the response I got from the city clerk when I asked about this measure. The clerk is like a sphinx, you could know her 30 years, and I almost have, and never know what’s on her mind. She states the facts, she answers a question as you ask it. Never opines. But, this time she seemed genuinely confused – it’s a stupid measure. And it makes a person think, council pulled a fast one – like the cell phone tax they collected illegally for years – and they need the public to approve it.

I hope that’s what other people are thinking, and I hope it fails. Districts are not only unnecessary, they are a ploy by both the liberals and the conservatives, who both seem to think they can manipulate this system.

Prepare to be manipulated!

And if somebody feels like emailing city finance man Scott Dowell, scott.dowell@chicoca.gov, they could ask him how much it is going to cost to REDRAW THE DISTRICTS after the upcoming CENSUS.

I’m also shocked to see how interested people are in the school board race. I’m sure glad, and I’m sorry I don’t have anything better to offer than “vote for people who aren’t/haven’t ever been school district employees”, but that’s my story, and I’m standing by it.

But I’m sincerely grateful to those of you who have downloaded and watched the video I posted –

https://gofile.io/d/zqp5BI

with big THANKS to DAVE for that link. Since I posted that last Friday, almost 100 people have seen it, and, as committee member Sean Morgan agreed, that’s a helluva lot more people than actually attend those meetings.

So, after I finish my chores this morning, I’m going to make a QUIZ! We all love a quiz, don’t we? I’ll try to make it good and tough. And yeah, I’ll probably allow cheating. The teachers I learned the most from were the ones who allowed open book/notes tests. And that’s the point here, I want more people to see how the city operates behind closed doors.

The Elephant in Election 2020: The pension deficit and staff’s efforts to shift the burden fully onto the taxpayers

7 Oct

Yes, I am still pissed off about being locked out of the Finance Committee meeting two weeks ago. But, I got a flash drive from staff, and having loaded it onto my laptop, I will post that video asap, with my usual snappy narrative. 

I wish I had waited until I saw the  meeting. I had endorsed all three members of that committee – frankly, on a “lesser of evils” strategy. After I watched the meeting, I found myself even more in support of Randall Stone, while my feelings for Morgan and Schwab have cooled considerably. 

I still say those latter two are the best bet (mind you, we’re talking about gambling) in their respective races, but I can’t endorse them. If they were horses I’d turn them out to pasture. Both of them voted to take this Pension Obligation/Lease Revenue Bond scam to the full council. But I don’t expect their challengers would have done any different. They all have a vested interest in funding the pensions. 

Finance Committee Chair Stone was the one who reminded everybody at the meeting that the consultant’s proposal was assuming CalPERS would achieve their full investment target of 7%. The consultant acknowledged this fact, adding,  I quote, “but we know that’s not going to happen…”  He repeated almost those exact words several times in the subsequent conversation.

Even though Morgan acknowledged same – “we’re certainly not going to fix CalPERS, I don’t expect they’re ever going to do any better on returns…” – he also said “we owe it to staff...” to continue the conversation with full council. Schwab agreed. Admitting that the conversation “raised a lot of questions,” she predicted the consultant would have a “much better, more prepared presentation for council.” Yes, I’m sure he will, having heard the criticisms of the plan, he will downplay the risks and play up the supposed benefits. 

Stone was the only committee member to speak plainly about the risks of these schemes – namely, the CalPERS debt and the bond debt will be paid ahead of any other expenses, including staffing and services – including law enforcement and fire personnel. The consultant spelled that out very clearly under the power point heading “Eyes Wide Open to Risks” .  If these proposals were ski runs they would be labeled “Black Diamond”.

Stone was the only one to openly discuss the truth behind these bonds. ” I’m uncomfortable shifting the burden from the beneficiaries to the rest of the city.” Meaning, not only does this proposal shift the burden of payment from the employees to the taxpayers, it shifts our resources away from services to paying the pensions. Period. Both the consultant and Chris Constantin made it clear this was a risky proposal that could bottom out our General Fund and cause layoffs. The consultant specifically mentioned public safety. So, this proposal to guarantee the pensioners their pensions would come at the cost of future employees, and that means, city services.  

The pension deficit and staff’s efforts to shift the burden fully onto the taxpayers is the Elephant in the upcoming election, but nobody cares? Chair Stone announced that no other members of the public had signed in, having acknowledged that I couldn’t get in. So, I’m pretty sure the only candidates who “attended” the meeting were the committee members. I wonder where the challengers stand on any of this? You might want to ask your candidate about that, if your district is on the ballot. 

The consultant set a timeline for this bond – including the discussion period – staff hopes to be signing off on this deal by next spring. So the public needs to weigh in. Now, because, the “upside” to these bonds, as pointed out by the consultant, is there’s no “validation process,” meaning, no voter approval. Is that really okay with you? 

It’s not okay with me, so I wrote a letter about it:

The city Finance Committee discussed restructuring the pension debt – now at over $280,000,000, including $140,000,000 interest. Two schemes presented: 1) Pension Obligation Bond, 2) Lease Revenue Bonds, using our city streets as collateral. The borrowed money would be invested. Ideally, the investments would pay off, and staff would make bigger UAL payments, eventually achieving a lower interest rate from CalPERS.

There is a razor’s edge to this proposal. Worst case and very likely scenario: both CalPERS and the city fail to meet their investment goals, the taxpayers end up owing both the bond investors and CalPERS.

Committee member Randall Stone commented that the consultant’s recommendation assumes a CalPERS investment return of 7%. The consultant acknowledged this fact, admitting, “but we all know this isn’t going to happen.”

Staffer Chris Constantin added, if the city’s not able to pay, “they could forcibly take the money from the General Fund… “ without regard to direct impacts on staffing and services. The consultant reported that a large Southern California county may soon lay off public safety personnel “so they don’t violate their bond covenants.”

Stone voted NO, commenting, ”I’m uncomfortable shifting the burden from the beneficiaries to the rest of the city.” Members Schwab and Morgan voted YES. Morgan admitted he doesn’t expect CalPERS “will ever do any better on their returns…” Schwab concurred.

The Government Finance Officers Association does not recommend these bonds, their first objection being CalPERS’ history of poor returns. What are Schwab and Morgan thinking?

 

Q & A for your district rep: What is CTO?

31 Jul

Thanks Jim, for sending me that piece from Cal Matters about the “pension spiking” case that went before the California Supreme Court.

https://calmatters.org/economy/california-pension-crisis/2020/07/court-spiking-pension-protections/?utm_source=CalMatters+Newsletters&utm_campaign=eec887cb04-WHATMATTERS_NEWSLETTER&utm_medium=email&utm_term=0_faa7be558d-eec887cb04-150570236&mc_cid=eec887cb04&mc_eid=69d539c9be

I had heard something about the Alameda County Sheriff’s Association trying to overturn the 2013 Public Employee Pension Reform Act (PEPRA), especially the sections forbidding spiking.

Here’s an example of pension spiking – 

https://publicpay.ca.gov/Reports/Cities/City.aspx?entityid=79&year=2018

The highest paid employee in Chico is the fire captain who sits on his (excuse me, I blame the COVID) BIG FAT ASS 24-7 over at the airport fire station, waiting for a plane to crash. That’s all he’s trained for, he does nothing but gets more than twice the salary he agreed to in his contract. That’s him at the top of the chart. Here’s the details –

https://publicpay.ca.gov/Reports/PositionDetail.aspx?employeeid=22081497

This person agreed to a salary of about $99,000/year, so how does he end up with “total wages” of $224,880/year? He spikes his salary with overtime, that’s how. Why wouldn’t the city just hire another man? Because Staff, led by Snake Charmer Mark Orme, has convinced our idiots on council that it’s cheaper to pay one guy more than his salary in overtime than hire another equally qualified person at the same salary.

In the old days, this man’s pension would have been based on his “total wages,” including overtime. That was banned by PEPRA.  Do you realize how that pissed off “public safety workers” all over the state? So they immediately lawyered-up and started to pick away at PEPRA.  Until now, courts have upheld the “California Rule” – “Any retirement benefits promised to a worker at the outset of a job can only be reduced if they are replaced with something of equal value.”   See, it’s all based on “collective bargaining,” another set of bullshit rules that say elected officials can’t bargain with employees, that they have to allow an “arbitrator” to make the deal, and then we all just have to go along with it. We don’t get to show face at the table, we don’t get to raise our fists – we’re just supposed to open our checkbooks and pay. 

Guess who our “arbitrator” is? Yeah, the forever arbitrary Snake Charmer in Chief, Chico Shitty manager Mark Orme. 

This ruling is an important,  “But the Supreme Court stopped short of out-and-out nixing the California Rule. “

“In the 90-page opinion written by Chief Justice Tani Cantil-Sakauye, the court found that “closing loopholes and preventing abuse of the pension system” was consistent with state law that otherwise makes it exceedingly difficult to renege on promised pension benefits for future work. “

So that means keep up the fight. Look at the other details in that page from publicpay.gov

Regular Pay       $98,795      SALARY
Overtime Pay    $103,972     OVERTIME
Lump-Sum Pay     $3,581      The dollar amount paid to the employee for one-time cash-outs (including, but not limited to, paid excess vacation and sick leave, and legal settlements)

Other Pay            $18,532      The dollar amount paid to the employee for any other pay not reported as regular pay, overtime pay, or lump-sum pay (such as car allowances, meeting stipends, incentive pay, bonus pay, etc.).

Defined Benefit Plan Contribution       $25,182    PENSION

Health/Dental/Vision Contribution      $12,447    HEALTH BENEFITS

While the court has banned and upheld that ban on including overtime in pension benefits, the California Rule still allows for “Lump sum pay” and “other pay” to be added to pension benefits. Here’s a recent post I wrote about that.

https://chicotaxpayers.com/2020/07/10/take-a-cup-of-ot-and-add-a-cup-and-a-half-of-cto-pour-in-some-sto-and-you-get-an-iou/

I hope more people read that July 10 post.  I know this is a complicated subject, but I’m a housewife who was trained as an elementary school teacher, and I GET IT. I’ve been called every synonym for “stupid” in the dictionary, but I GET IT.  

Chico City Council just signed another year of cop and fire contracts without even discussing the pension deficit. I’d bet my last $5 most of council didn’t even read the contracts. 

Want to find out? Ask your district representative or candidate, “What is CTO?” Let me know what you get. 

UPDATE: I’m so glad I asked – my district rep, Kasey Reynolds, gave me a good conversation. I’m critical, and sometimes I realize, kind of a bitch. But Reynolds always responds, and she’ll admit when she’s not aware of various details. 

The worst response you can get from your district rep or candidate is NONE. Don’t let them get away with that – be polite, be firm, and if you don’t get a response, email them again. 

 

Joe Azzarito: The California Rule needs to be repealed

29 May

Well, they’ve thrown down their tax measure – at another “remote” meeting. 

5.2. ORDINANCE ADDING CHAPTER 3.90 TO ESTABLISH A ONE-CENT SALES TAX
On November 20, 2018, the City Council approved a Finance Committee recommendation to
engage a professional consulting firm to conduct a tax feasibility voter survey of City residents to
determine the viability of passing a tax measure and on April 16, 2019, the City Council directed
the administration of a voter survey for a 1 cent sales tax measure. EMC Research conducted the
voter survey and on October 15, 2019, EMC presented the results to the City Council which
indicates support for a 1 cent sales tax measure in November 2020. The City Council acted to
direct City staff to prepare the necessary documentation and related actions to place a 1 cent
general sales tax on the November 2020 ballot. The requested action would initial the formal
requirements to proceed with the measure. This action requires 5 affirmative votes. (Report –
Chris Constantin, Assistant City Manager)
Recommendation: City Manager recommends the City Council introduce the following ordinance
by reading of the title only:
AN ORDINANCE OF THE CITY OF CHICO ADDING CHAPTER 3.90 TO THE CHICO CITY
MUNICIPAL CODE TO ESTABLISH A ONE CENT GENERAL PURPOSE TRANSACTIONS
AND USE (SALES) TAX TO BE ADMINISTERED BY THE CALIFORNIA DEPARTMENT OF
TAX AND FEE ADMINISTRATION INCLUDING PROVISIONS FOR CITIZENS’ OVERSIGHT
AND ACCOUNTABILITY

As you know, the city of Chico is in financial trouble. So, wow, how have they pulled off a $9,000,000 annual pension payment, in addition to millions more paid in payroll? You realize, in 2012-13 they reported a $168,000,000 pension deficit – now it’s only about $130,000,000. That’s about $5.4 million a year – EMBEZZLED out slowly by our city staff to pay their pension deficit.  Look at your trashed streets, trashed park, and your increasing sewer fees – where do you think they  got the money? Bake sales?  

For years, Staff has siphoned money out of city funds into their pension deficit. They  take a percentage of payroll from each department, JUST TAKE IT.  According to the legislation known as The California Rule (no, you didn’t pass it, your pensioned legislators passed it),  the pensions get paid before anything else. Yes folks, that the law. You are second to the public employees. How does that make you feel? Like you got a pack of leeches in your pants? 

Here’s what Chicoan Joe Azzarito thinks about it.

Previously, I wrote about desired attributes of both elected and non-elected government office holders.  Attributes: 1) Integrity 2) Honesty 3) Accountability 4) Transparency 5) Experience 6) Reliability 7) Morality and lastly 8) Scruples.  Nowhere did I list the ability to lie with a straight face.

Prolific writers Scott Paulo and Roger Beadle feel that only Republicans, especially Donald Trump, exhibit this last most undesirable character flaw. They fail to examine and call out their own heroes – Democrats.  The Corona pandemic has exacerbated this negative feature that a vast majority of government displays daily.

Locally, CARD officiously wanted to put into force a parcel tax without owning up to hidden lies as to cost. Chico council plan to follow suit with a sales tax increase because government employees cannot live with six figure incomes. On a distressed airplane about to crash, we are told to care for our children first before ourselves.  Not so in government – they take care of themselves first and tell us every chance they get to live with broken streets, bad lighting, crime and ultimately homelessness.

The California Rule, behind which they all hide to insure their livelihoods, needs to be repealed.  No Chico person needs $100,000 to $200,000. How many police chiefs and fire chiefs should Chico pay forever. Chico council and their staffs love tax increases because from them come their salaries.  We need to clean house once again and get rid of these leeches. Top pay for one or two individuals should equal $100K and everyone should pay 100% of their pension – no more.

Joe Azzarito, Chico CA

 

Chico is in trouble – and here’s why

21 May

Bob sent a link to an article from Forbes – Why California is in Trouble”  It’s a good read. If you can’t make the link below work, just google the author, Adam Andrzejewski, or “Forbes, Why California is in Trouble” (Thanks Donna!)

https://www.forbes.com/sites/adamandrzejewski/2020/05/19/why-california-is-in-trouble–340000-public-employees-with-100000-paychecks-cost-taxpayers-45-billion/#12f7e2955fb8

The author, Adam Andrzejewski (Angie-eff-ski) is the CEO & Founder of OpenTheBooks.com – one of the largest private databases of government spending in the world. Andrzejewski documents salaries all over the US, and tells us, there are 340,000 public employees in California making over $100,000. 

“Our auditors at OpentheBooks.com found truck drivers in San Francisco making $159,000 per year; lifeguards in LA County costing taxpayers $365,000; nurses at UCSF making up to $501,000; the UCLA athletic director earning $1.8 million; and 1,420 city employees out-earning all 50 state governors ($202,000).”

Lifeguards costing $365,000/year? You say, that’s nuts?  No, it’s not. LA has miles of public beaches. Just think what would happen if CARD ran LA beaches – yeah, lifeguards would make $365,000/year. That’s what happens when nobody is watching the purse strings, except the thieves.

Right now this man, beaming like a ghoul, is running our town. Did you vote for him? 

Chico City Manager (High Dollar Whore) Mark Orme at the CARD Center following the State of the City forum in January. Photo by Ashiah Scharaga

No, he was hired by the pack of ninnies we know as “Chico City Council.”  We had nothing to say about his hire, and we have nothing to say about his salary – now $207,000, plus a $56,000 benefits package. We pay that, he pays another $24,000/year, and gets 70% of his highest year’s salary for the rest of his life. 

While Orme boasts that he has not had a raise for several years now, he certainly managed to negotiate himself a second pension – a 457 plan, which is a special kind of 401K for public workers. Orme wormed the city into paying $10,000 a year into that fund, PLUS 4.5% of his salary. In addition to the money paid toward his CalPERS pension and health benefits. 

That is why not only Chico is in trouble, but our entire state is in horrible financial straits – over generous salaries, and a crazy retirement scheme.  CalPERS clients are paying less than half the cost of these pensions, with employees contributing little or nothing, but expecting to get 70% of their ridiculous salaries, with COLA, for the rest of their lives. 

Ex Chico City Manager Tom Lando, for example, retired at about $134,000/year, but now makes about $155,000 – IN RETIREMENT. That’s the “cost of living adjustment” .  He also gets himself hired for various interim positions – like city manager of Oroville – and those salaries add to his pension. That’s why Lando was the first one to raise the notion of a sales tax increase for Chico, and used his own money to pay for a survey to push it. He also donated $6,000 to the Yes on Measure A campaign for CARD’s parcel tax. Lando knows better than anybody that CalPERS must be funded, or he’s out $155,000/year and counting. 

Essentially, CalPERS has led the taxpayers to a room full of straw and is demanding we make enough gold to keep our public workers like a pack of high-dollar whores for the rest of their lives. 

Right now, the city of Chico is working behind closed doors, using ConVID to keep us out of the tax measure conversation. They’re spending taxpayer money on consultants to write the measure and strategize the campaign, just like CARD. 

Don’t be discouraged by the remote meetings. I won’t recommend Chico Engaged, I’ll say, write to council members directly, and tell them we resent them spending taxpayer money on a sales tax increase when they’ve done nothing to reform the pensions and contracts. 

ann.schwab@chicoca.gov

alex.brown@chicoca.gov

sean.morgan@chicoca.gov

kasey.reynolds@chicoca.gov

scott.huber@chicoca.gov

karl.ory@chicoca.gov

randall.stone@chicoca.gov

 

A tax measure would be spit on the Chico griddle – we need TRUE PENSION REFORM

11 May

I’ve been busy with a lot of stuff, but like I promised, I wrote a letter to the ER about Robert Koyasaki’s “Pension Time Bomb” series. I’m embarrassed –  I mis-spelled Siedle through the entire post, I have to go back and fix that, sorry. But I think I got a good letter out of it – you tell me.

Cities across America, like Chico, are unable to provide basic services because all the money is going to pay for pensions. No matter how much money the taxpayers pour into this system, pension expense will continue to outstrip revenues.

Salaries are excessive. Chico city management positions pay four to five times the median income.  

The city pays too little, with employees contributing even less. Until the Public Employee Pension Reform Act of 2013,  management employees paid nothing toward their pensions. Now they pay between 10 and 15% of total cost, the total payment being 20 – 30%. 

Pension deficit  is created by agencies and employees that don’t pay enough on payroll. The excess becomes the Unfunded Actuarial Liability. Employees contribute nothing toward the UAL, which is over 65% of total employee cost. The California Rule mandates that the pension deficit must be paid ahead of everything else.  For example, our finance director says we have no money to fix streets, but in July he will make the annual $9 million (and growing) payment toward the UAL.

A tax measure would be spit on the griddle in this situation.  Here are my suggestions:

  1. Negotiate lower salaries for management, or hire somebody else
  2. Get all new employees off CalPERS, switch to 401Ks
  3. Pay more in payroll, which would mean, ALL employees would have to pay more, even based on their current shares.
  4. Pre-PEPRA employees should have to pay toward the UAL, or “catch up” payments – they should pay the same shares they pay toward the payroll portion.

Juanita Sumner, Chico CA

 

No matter how much the taxpayers dump into the pension system, it will fail and drag our economy down with it, unless we take immediate steps toward true reform

6 May

Listening to Robert Koyasaki’s Pension Time Bomb radio show made me so mad I had to take a break. But I finally finished the discussion between Koyasaki, a real estate investor, economist Edward Seidle, and Phoenix Arizona city council member Sal DiCiccio.

https://chicotaxpayers.com/2020/04/30/if-you-see-more-revenues-coming-in-to-your-city-and-you-keep-wondering-why-your-roads-are-looking-like-crap-and-you-believe-youre-not-getting-the-type-of-services-you-should-be-getting-its/

DiCiccio explained that cities across America are unable to provide basic services because staffers are pouring all the taxpayers’ money into their own pensions. Because of excessive salaries, ridiculously low contribution rates, and horrific mismanagement of pension funds, the pension deficit, or Unfunded Accrued Liablity, ” will continue to climb. No matter how much money the taxpayers pour into this system, pension expense will continue to outstrip revenues.

First of all salaries excessive – our city manager, for example, at $207,000/year in salary, makes almost 5 times the median income in our area. Many economics experts, including Seidle, have said that if the salaries were more rational, the pension system would work.

Second, agencies pay too little, with employees contributing almost nothing. In fact, until Orme started paying in a few years ago, he was paying NOTHING. His predecessors, like Tom Lando, Greg Jones, Dave Burkland, and Brian Nakamura, paid nothing. Lando is now getting over $155,000/year in pension, plus COLA, having made absolutely no contribution for his entire career.

These agencies have used CalPERS like a credit card, and now they want us to pay.  First of all, the agency doesn’t pay enough in total.  As of now, the city of Chico is paying, depending on the employee group, between 20 and 30% of total payroll cost, with employees, also depending on bargaining group, paying between 9.75 and 15%. Finance mangler Scott Dowell said in his power point presentation that “City of Chico employees are paying, or are nearly paying, HALF of the CalPERS pension costs.” That is one of the Big Lies. See, he forgets to mention, the Unfunded Actuarial Liablity, or “pension deficit”, which is over 65% of total cost, and the taxpayers pick up that whole tab, with interest.

That UAL is created by agencies that don’t pay enough on payroll, and don’t require enough of their employees. The money they don’t demand becomes the pension deficit, and then the employees are off the hook to pay it. They contribute NOTHING toward the pension deficit, or UAL, payments, the  taxpayers are stuck with the whole turd. 

And then there’s mismanagement of funds. CalPERS is our pension system. They have been criticized for promising too high a return from the stock market, especially since they make horrible investments. They tell their member agencies they only have to pay so much, and then when their investments tank, they come banging on the door for more.

DiCiccio and Seidle explain that no agency requires any member of their pension boards to have any financial credentials or education – the boards are made up of union members. These people are completely dependent on Wall Street money managers.

DiCiccio says, “The wall street money managers are screwing everybody,” from the taxpayers to the employees. He gives an example, which is verified by Seidle – one Phoenix employee group paid $40 million to their money manager for a $4 million return on their investments. Seidle adds, “In the last 10 years the fees have grown exponentially because they are doing high cost high risk investments, which have much higher fees.” And there he also mentions the high risk investments – in one case, CalPERS board members were caught buying bad stocks off of friends.

https://www.breitbart.com/local/2016/06/03/former-calpers-ceo-sentenced-4-years-taking-huge-bribes/

So, what can we do? Unfortunately, we can’t just stop paying our taxes, that’s not going to go anywhere. Also unfortunate – most states, including California, have passed legislation that protects the pensions of those members hired before 2013. “The California Rule,” passed by the state legislature behind closed doors, says, in fact – we must pay the pensions before we pay for anything else.

Last night, watching Chico City Council’s latest remote meeting, I saw it right in front of my eyes. It was in the report Dowell made to council at last night’s remote meeting. He showed council that list of services that $taff plans to cut. One cut that was taken off the list since he made the same presentation at last week’s Finance Committee meeting was deferring payment of the annual Unfunded Actuarial Liability. That is an annual payment, the penalty for missing it would be about $355,000 in late fees. But last night Dowell said there was plenty of money to make that payment  in the General Fund – $9 million. That’s just this years payment, up about $1 million from the payment I saw in last year’s budget.

Dowell, Orme, Constantin and the Public Works staff have acknowledged for about 5 years now that they have not been funding street maintenance or repairs, but they’ve never missed a UAL payment. If that’s not Mutiny folks, I don’t know what to do with my yardarm.

So here are my solutions to this mess:

  1. Get all new employees off CalPERS and give them 401Ks
  2. The city of Chico needs to pay more in payroll, which would mean, all pre-PEPRA employees would have to pay more, despite their ridiculous shares.
  3. Pre-PEPRA employees should have to pay toward the “catch-up payments” or “UAL” – they should pay at least the same shares they pay toward the payroll portion.
  4. Retired employees making more than $(??,???) per year in pension should have to contribute or lose benefits.

Let me know what you think.