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Oroville council, cops, take 10 percent salary cuts in face of bankruptcy – meanwhile, raises all around for Chico management!

6 Oct

We were just talking about Oroville’s financial problems  – here’s their action plan:

http://www.chicoer.com/general-news/20171005/oroville-city-council-takes-voluntary-10-percent-pay-cut

As you know, Chico City Council just approved sweet new raises for city management, more than enough to cover their slightly increased PERS shares. With over $180 million in unfunded pension liabilities, the city’s mandated extra “side fund” payments are now over $500,000 a year and expected to increase to $1.5 million within the next couple of years. And come on – at that  rate, we’ll never get rid of the pension bomb.  

Did you know our city council get salaries? Last I heard, their salaries are roughly the same as reported for O-ville, although, I think, a little more. In the article, it says Oroville councilors can also opt for a health benefits package – in Chico, those packages have cost anywhere between $8,000/year and $21,000/year. When I last checked, Ann Schwab and Mark Sorensen were taking the most expensive packages available. Here’s the scam – they pay 2 percent of their council salaries – less than $1,000 a year, do the math – for these packages. 

What kind of package do you have? How much do you pay for it? 

In Hemet, which was left in ashes by Brian Nakamura, Mark Orme, and Chris Constantin, the local Taxpayers Association put an ordinance on the 2010 ballot that ended health benefits for city council members. The voters passed it with over 75% of the vote. It cost the HTA about $7,000 to float two ordinances – the second, term limits for city councilors, also flew through with about 75% of the vote.

https://chicotaxpayers.com/2014/04/19/hemet-taxpayers-association-eliminated-health-benefits-for-council-members-and-instituted-term-limits/

The city shall not pay for, fund, or otherwise contribute to, the premiums, charges, fees or other costs of health benefits made available by the city to elected city officials either during their term or after their term of office.

Just something to think about, as the city of Chico plunges further into debt and continues to cut services, cut services, cut services…

 

 

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O-ville talking bankruptcy? Time for public employees to take a walk in “the real world”

30 Sep

Thanks again Dude, for this link – I’ve been too busy to read the papers lately, get a load of this story from the Oroville Mercury Register – Oroville going bankrupt?

http://www.orovillemr.com/article/NB/20170927/NEWS/170929752

“The city’s finance director Ruth Wright told the California Public Employees’ Retirement System (CalPERS) finance and administration committee last week that the word “bankruptcy” was being thrown around, though not at council meetings.”

Not at council meetings? Council still in denial? Well, here in Chico, we have a $186 million deficit, and council is fully aware. So they handed out raises to top management! Now that’s a plan!

“The city [Oroville] cut down its $1 million deficit to achieve a balanced budget this year but is not exactly thriving financially, operating with low staffing levels and recently negotiating a 10 percent pay cut for police, with more negotiations to come.”

A 10 percent pay cut for police? You could expect Chico PD to walk out on any such negotiations – they threaten to cut service – which is essentially a STRIKE – if they don’t get raises.

Oroville’s finance director Ruth Wright says CalPERS is the problem and CalPERS needs to fix it.

“’All cities and counties cannot keep up with the increases,’ she said. ‘I think it’s up to them (CalPERS). They need to do something. They need to do a better job investing.’ The organization announced in December that discount rates would drop from 7.5 to 7 percent over the next three years in an effort to make the fund more stable, but with impacts to state and local governments.

“’CalPERS has a few levers to pull in dealing with pensions, having to do with discount rates,” said Wayne Davis, head of public affairs for the pension fund. “We’re very much aware of what lowering the discount rate means.’”

Well,  “we all” don’t know what he’s talking about – “lowering the discount rate…”

From CalPERS – straight from the horse’s ass –

https://www.calpers.ca.gov/page/newsroom/calpers-news/2016/calpers-lower-dis

“Lowering the discount rate, also known as the assumed rate of return, means employers that contract with CalPERS to administer their pension plans will see increases in their normal costs and unfunded actuarial liabilities. Active members hired after January 1, 2013, under the Public Employees’ Pension Reform Act will also see their contribution rates rise. Normal cost is the cost of pension benefits for one year.”

Remember, I asked Chico Unified School District finance chief Kevin Bultema about this, right after the passage of Measure K in last November’s election, and he said the district would need to find more funding to pay pension costs or cut programs for the kids.

So, of course, this means a bigger deficit for Oroville, and don’t forget Chico.

“Oroville’s finance director said the number of city representatives coming to confront CalPERS has been growing. At the meeting last week, officials from cities such as Chico, Santa Rosa, Laguna Hills, Lodi, West Sacramento, Vallejo, Yuba City, Hayward, Manteca and Concord were there. A legislative representative for the League of California Cities also participated.”

Well, that’s funny – this hasn’t come up in the Chico paper, which is edited by the same David Little that edits the Mercury Register. Neither have we talked as a town about the $186 million deficit, or the $500,000/year “side payments” (in addition to the regular premium payments), which will balloon to over $1.5 million/year within the next three years.

And the sky is the limit, since our elected morons – both Chico and Butte County – keep giving out raises as though everything’s just rainbows and lollipops. They’ve acknowledged the mess we’re in – because they want us to pay more taxes.

The reporter finally talked to Chico finance mangler Scott Dowell – formerly with Chico Area Recreation District, which has a $1.7 million deficit for less than 35 employees. Dowell doesn’t think Chico will go into bankruptcy, but has been trying to work with CalPERS.

“Dowell was hoping the pension fund representatives would do some research on the possibility of freezing cost-of-living adjustments, meaning retirees would receive a flat rate every year. They would no longer receive additional money — currently up to 2 percent of their annual salaries — to account for changing inflation.

The other concept was switching all employees onto the same kind of pension plan as employees who started after Jan. 1, 2013. The Public Employees’ Pension Reform Act went into effect then, offering fewer benefits to new employees. That could mean the difference between retiring at 55 and 62, Dowell said.”

Both no-brainers as far as I’m concerned, and “the way it works in the real world”.

 

Council to confirm $taff appointments – get a load of these salaries! How will we pay for the pensions?

28 Sep

From next week’s council agenda:

http://chico-ca.granicus.com/GeneratedAgendaViewer.php?view_id=2&event_id=273

CONFIRMATION OF DEPARTMENT HEAD AND DEPUTY DIRECTOR APPOINTMENTS

Section 605 of the City Charter states that the appointment of department heads is subject to confirmation by the City Council.  In order to meet this requirement, City Council is being presented with the employment agreements for Administrative Services Director (Scott Dowell); Assistant City Manager (Chris Constantin); Chief of Police (Michael O’Brien); City Clerk (Deborah Presson); City Manager (Mark Orme); Deputy Director – Finance (Barbara Martin); Public Works Director – Engineering (Brendan Ottoboni); Public Works Director – Operations and Maintenance (Erik Gustafson). (Report – Mark Orme, City Manager)

Recommendation :A. In compliance with Government Code Section 54953(c)(3), the Legislative Body shall first orally report a summary of the recommendation for final action related to the employment agreements for: Administrative Services Director, Assistant City Manager, Chief of Police, City Clerk, City Manager, Deputy Director – Finance, Public Works Director – Engineering, and Public Works Director – Operations and Maintenance: “The City Manager is proposing to modify the employment agreements with Scott Dowell as the Administrative Services Director, Chris Constantin as the Assistant City Manager, Michael O’Brien as the Chief of Police, Barbara Martin as the Deputy Director-Finance, Brendan Ottoboni as the Public Works Director – Engineering, and Erik Gustafson as the Public Works Director – Operations and Maintenance; and The City Council of the City of Chico is proposing to modify the employment agreements with Deborah Presson as City Clerk and Mark Orme as City Manager; and The Legislative Body is proposing to modify the appointment of Scott Dowell with an annual salary of $132,873, Chris Constantin with an annual salary of $185,000, Michael O’Brien with an annual salary of $154,679.99, Deborah Presson with an annual salary of $144,039.67, Mark Orme with an annual salary of $207,500, Barbara Martin with an annual salary of $117,541.49, Brendan Ottoboni with an annual salary of $138,009.37, and Erik Gustafson with an annual salary of $135,397.50.” B. The City Manager recommends Council Confirmation of the modifications as indicated above. C. The Mayor, on behalf of the City Council, recommends Council confirmation of the modifications as indicated above for the City Manager and the City Clerk.

UPDATE: As a friend of mine points out, “So Orme now makes $9,000 more than last year’s contract.  Maybe one block could have been resurfaced and that would last decades. Whereas, in Orme’s wallet — it goes for a 1%er lifestyle.  And Constantin was hired to do 3 jobs: finance, HR and administrative director.  Now he does one and gets more $$ now than he did for a couple of years! “

I’ll add, Debbie Presson has a bigger $taff now, does very little work herself, but has got about $10,000 in raises, just over the past couple of years. When asked to pay more of their pension, management $taff demanded and got raises that more than covered their new portion.

Here’s my prediction – Presson is spiking up and will retire within the next year.

Who is at fault here? Well, us, cause we elected the $heissers on council who keep approving these contracts. 

City has no financial emergency policy, $taff suggests a policy for revenue measures

25 Sep

The report I got is not cut-and-pastable, you can read it for yourself here.

http://www.chico.ca.us/government/minutes_agendas/documents/FinanceCommitteeAgendaPacket-9-27-17.pdf

I’ve again asked the city clerk’s office to send me a cut-and-pastable copy, there’s stuff in this report that needs to be discussed publicly. 

Those of us who paid attention watched council first deny and then flub their way through near-bankruptcy.  They hired an out-of-town gun to “fix” things, he gutted $taff and walked away having established unprecedented salaries for management and a policy that allowed management to pay less than 10 percent of their own pensions.

So yeah, we need a emergency plan, but what I see here is a plan to pay down their pensions. 

“pay down scheduled debt payments…” 

The city’s biggest debt schedule is the $185 million-plus they owe on the pensions. $taff is currently paying $500,000/year on that debt, but payments will go up to $1.5 million within the next few years. 

How will they find the money?

“This policy authorizes the city manager…to investigate…enhanced revenue sources…including…tax increase proposals…”

I don’t have time to re-type the whole report, and our $100,000-plus clerk $taff screwed up sending me the report – as I’ve established with Presson and Brinkley, the reports are supposed to be loaded in such a way that they cut-and-paste, but Stina Cooley, recently promoted to the position, apparently does not know this. Or is just trying to put one over, I don’t know. 

Read it for yourself. 

UPDATE: Sorry to be so testy when I posted the above from my phone, but I get so sick and tired of $taff. Stina Cooley has been with the city for a while now, recently took on some clerk duties, and ignored me when I asked her to resend the reports in “cut-and-paste” format. 

I know people don’t hit the links – Word Press puts eyes in the back of my head. I know a lot of people read the posts without hitting the links, and I use cut-and-paste to quote sections of the reports so they will see, in exactly so many words, what $taff is up to. 

So today I resent my request, and done as I should have done in the first place – cc’d Cooley’s supervisor Dani Rogers. I cc’d Mark Orme because I want to keep him abreast of his $taff’s performance. 

And of course Rogers responded very quickly that the reports would be converted to text, and then she sent me the link. 

These people get paid a lot of money to have some old landlady tell them how to do their job. 

Loyalton Calif cuts pensions – why can’t Chico do same?

27 Aug

Thanks to Jim for picking up this article, from the Los Angeles Times, about a little town not far from Chico.

http://www.latimes.com/politics/la-pol-ca-loyalton-calpers-pension-problems-20170806-htmlstory.html

I think we have a similar situation here. Early in the 2000’s, a city council including current county supervisors Maureen Kirk and Larry Wahl, at the behest of then city manager Tom Lando, signed an MOU with city employees, attaching salaries “to revenue increases, but not decreases…”  

Staff then went on a permits binge, permitting development all over town, houses piled into Grandma’s back yard, raising city revenues and salaries along with them. Staff got 14, 19, 22 percent raises over a very short period.  Lando’s own salary went from around $65,000 a year to over $120,000 a year within a very short time. 

When this scam was figured out by the public, they stopped it, but started paying the “employer paid member contribution” –  the city started paying most, even all of the employee’s pension share.

We’ve been screeching about that, so lately they just  raise the employee’s salary to cover their new pension share – they are determined that the taxpayer will foot the bill for these pensions (the following list is from 2012, remember, these people get cost of living increases) :

https://chicotaxpayers.com/2012/01/30/heres-why-lando-wants-to-raise-your-sales-tax/

Tom Lando hasn’t been pumping the sales tax increase lately, but I’m sure he’s behind it. Lately, in his position as Chico Area Recreation District Board member, he’s been pushing for a bond on our homes. It doesn’t matter which agency gets the money, as long as they pay their CalPERS deficit with it. 

Loyalton only had four employees – can we do the same thing? I think we can sue the city for the outrageous raises given these pensioneers – spiking – right before they retired, like Lando. But I’m not a lawyer. 

What do you think? 

City facing $178,075,000 in unfunded street projects, less than $2 million in the street improvements fund

18 Aug

Speaking of the proposed sales tax increase – “to fix the roads” – here’s another knee slapper – the city needs over $178 million to bring our streets up to standard, just to mitigate the effects of new construction. Here’s the link to that report in next weeks Finance Committee agenda.

http://www.ci.chico.ca.us/document_library/minutes_agendas/finance_committee/8-23-17FinanceCommitteeAgendaPacket.pdf

Right now city staff is wrestling with developers like Bill Webb, who feel the city is expecting too much of the money to come out of new construction fees.

The report is difficult to understand, but what I’m guessing is, they don’t want to pay the “Urbanization” fee at all, they think the taxpayers should have to pay to fix the streets. But, I’ll give it to staff – they make a very good argument, pointing out the obvious – new development, especially these high density subdivisions that are going into Grandma’s backyard all over town again, generate more traffic and the developers/homebuyers who build them should have to pay for the added impacts.

What about the proposed sales tax increase?  Taber admitted, “The city would only raise 4 to 4.5 million per year if they increased the sales tax by a quarter cent. ” 

Well, like I said – $4.5 million compared to $178 million – that’s a little tiny bubble of spit on a great big griddle.  According to the Finance Committee report linked above, just one of five currently approved projects – a stretch of Humboldt Road that has been heavily impacted by new development – will cost over $6 million. Other’s ranged between $800,000 and just over $2 million.  

But, $4.5 million would cover the increasing amount CalPERS is demanding to cover our pension deficit – $800,000 now, expected to increase to $1.5 million within the next three years, and on up from there.  Meanwhile, Chico City Council is handing out raises that increase the deficit while refusing to ask employees to pay more out of their own paycheck.

Tsk, tsk, get good tires on your car.

 

 

 

 

The city budget is just a suggestion! See how they appropriate our money into their own pockets

13 Aug

The city of Chico posts the budget online:

http://www.chico.ca.us/finance/documents/2016-17CityAnnualFINALBudget.pdf

But the budget isn’t set in stone, rather merely a suggestion.  Every month you will find appropriations – departments go over budget, and council just routinely approves mo’ money, mo’ money, mo’ money.  The memo below is on this coming week’s council agenda, available here,

http://chico-ca.granicus.com/GeneratedAgendaViewer.php?view_id=2&event_id=270

Here we have an appropriation for the fire department – oftentimes it’s either cops or fire. The chief has given us a “partial” list of “unanticipated” costs, without any explanation. What, for example, did Chico Fire have to do with the “Oroville Spillway Incident”? What were they doing at the Santos Fire?

And how could we miss – $73,000 for “Unanticipated Retirements and Lay-offs”?

This is how they fritter our money, right under our noses.  This is why the state has their nose up our ass for fraud.

Meeting Date: 8/15/17
TO: City Council
FROM: Bill Hack, Fire Chief
RE:  FY2016-17 Supplemental Appropriation/Budget Modification No. 2017-FD-004

REPORT IN BRIEF:

Throughout a fiscal year there are unanticipated costs incurred by the Fire Department. These costs are generally
associated with emergency response to large incidents or multiple medium sized incidents within the City of Chico,
unanticipated retirements or long-term absences, and other anomalies. The Department attempts to absorb all
unanticipated costs in the current adopted budget. However, depending upon the timing and/or amount of the
unanticipated costs it is often impossible to do so.

For Fiscal Year 2016-17, the Fire Department incurred at least $192,000 in unplanned expenses. The Department
was able to absorb approximately half of the unanticipated costs, but due to the magnitude and timing of the events
the department was unable to absorb $101,602 in expenses

A partial list of the unanticipated Fire Department costs for Fiscal Year 2016-17 is included below:

Oroville Spillway Incident (Partial Reimbursement Pending) – $25,000
Santos Fire – $20,000
Pay-outs for Unanticipated Retirements and Lay-offs – $73,000
Fire Investigations (Complex) – $10,000
Retroactive Salary Payments due to a processing error (2015-Present) – $27,000
Emergency Call-Back Coverage – $12,000
Other (Long-term Leave) – $25,000