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Oroville transfers $366,000 in Camp Fire money to Pension Stabilization Fund

5 Mar

PUBLISHED OROVILLE MERCURY NEWS:  | UPDATED: 

LETTERS TO THE EDITOR

“Let the games begin, or should I say, let the shell games continue.  On Feb. 19,  Oroville Financial Director Ruth Wright,  gave an update on Oroville’s city  budget. She caught my attention when I heard her say $366,000 in FEMA funds were applied to the “Pension Stabilization Fund.”

Oroville’s previous council decided to repurpose all “one-time money”, to this fund.  This year over $1 million was swept  away from city improvements and funneled into the  CALpers stabilization accounts.

For those that voted themselves a one percent tax increase in hopes of fewer crimes, street repairs, and clean parks, I fear you will be disappointed. It’s all about  the unsustainable CALpers fund. Oroville now has a one percent added-on sales tax plus a five percent Utility Users Tax. Look at the five utility bills you receive each month. Check out the UUT you are paying.

The city has been asked to repeal the five percent Utility Users Tax now that the one percent sales tax has passed.  City staff has recommended “no,” citing the city’s precarious financial situation. The council decided to delay that decision for a year.

I would predict there will be no repeal. The shell games will continue. The city will still be crying poor. New fees and tax proposals will be pursued. The proceeds will be used for CALpers contributions in a futile attempt to delay its inevitable collapse.

— Lorraine Christensen, Oroville”

“Why is there always enough money for large pensions and raises (and propaganda) for bureaucrats yet never enough money to maintain the streets?”

4 Mar

I want to thank Dave for writing this kick-ass letter to the Enterprise Record last week. I know it ran either the day before or the day of the Finance Committee meeting last week and I know Mark Orme read it. Now I also know I’m not the only person who has a problem with paying for a campaign to raise my taxes to pay  for the pension deficit created by years of entitlement. 

Orme mentioned the pensions, but would not admit they are the real drive behind a revenue measure. He said they want the money to either  fix streets or hire more cops. But we’ve all seen the method by which they transfer money from every department into the “Pension Stabilization Trust” and the “UAL” fund to pay down a deficit that the employees created themselves by not paying enough into their own pensions. 

Write your own letter folks – don’t be an ostrich, stick your head up and be heard. 

Why is there always enough money for large pensions and raises for bureaucrats yet never enough money to maintain the streets?

And now our city council members have decided there is plenty of money in city coffers to propagandize the public, so they are giving tens of thousand of our tax dollars (and most likely more later) to a PR firm to sell us another bond measure (just another type of tax increase) or a sales tax increase. And this does not include the cost of the city bureaucracy’s staff time. Is this how you want your hard-earned tax dollars spent?

And whatever tax increase they sell you will be just a down payment as the city’s unfunded pension liability will only get worse. Just wait for the next recession and stock market plunge. Then the politicians will spend more of your tax dollars to sell you yet another tax increase.

I urge everyone to read the long time political watchdog and journalist Dan Walters’ editorials: “Despite law, politicians use taxpayer funds for campaigns,” “Local tax hikes cleverly packaged,” “Cities should fess up about taxes, pensions,” and “Property tax surge reveals the truth: Local tax hikes are all about pensions” athttps://calmatters.org/articles/author/dan-walters/. (Some of these editorials ran in the Chico ER.)

As Walters notes, “With very rare exceptions, however, officials who place the tax increases on the ballot will not publicly say the extra revenue is needed to offset rising pension costs. Rather, on the advice of high-priced consultants, they say the money is needed for popular police and fire services and parks.”And he says, “The League of California Cities has raised the alarm about ‘unsustainable levels’ of pension costs. Isn’t it time for the cities themselves to be truthful when they ask voters for new taxes?”

Our community is in a state that has some of the highest taxes and living expenses in the nation. And if the local politicians have their way your taxes and expenses are going up. Also, wages in Butte County are in the bottom 10 percent of the larger counties in the nation. California has the highest poverty rate in the nation at 19% and Butte County is even worse at 21%. It is unfair to increase this community’s tax burden while government employee pensions go unreformed.

It is long past time for politicians to spend within our means and represent us instead of special interests at our expense.

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

 

Howard Jarvis Taxpayers Association taking Yuba County to court over fraudulent tax revenue Measure K

27 Dec

In November the voters of Yuba County barely passed Measure K, a 1 cent/.01 sales tax increase. The measure read as follows:

To maintain and protect essential services such as 9-1-1 emergency medical/fire response; improving wildland fire containment; maintaining 24-hours sheriff’s patrol; attracting/ retaining jobs, businesses, and qualified sheriff deputies; and other essential services, shall the measure to establish a 1 cent sales tax for 10 years in unincorporated Yuba County, providing an estimated $4,300,000 annually requiring accountability, citizens’ oversight/ audits, and all revenue controlled locally, be adopted?”

California law currently requires a 2/3’s vote to pass a “special tax” for revenues that will be set aside for a specific purpose. But Yuba County ran Measure K as a general measure, only requiring 51% of the vote, even while telling the voters that the money would dedicated to public safety. You’ll note, they don’t mention services such as street maintenance or library funding, but specifically mention “emergency medical/fire response, wildland fire containment, and sheriff’s patrol…” 

There is a weird section about “retaining jobs, businesses…” – I’ll say, this measure was at the very least poorly written in a direct attempt to confuse the voters. But I think the specific mention of safety services should mean it requires 2/3’s voter passage. Of course I’m not a lawyer.

Luckily the Howard Jarvis Taxpayers Association has plenty of lawyers on staff, and a couple of vigilant Yuba County businessmen were quick to ask for help. HJTA retained a Sacramento law firm to file an action against the County of Yuba to stop the implementation of the tax. 

From Lou Binninger, at the Territorial Dispatch in Yuba County:

https://www.eterritorial.com/47-guest-writers/lou-binninger/14419-measure-k-challenged

On Friday December 21, 2018, the Sacramento law firm of Bell, McAndrews and Hiltachk filed an action in Yuba County Superior Court to invalidate Measure K – the Public Safety/Essential Services Protection Ordinance that appeared on the November 6 ballot. Measure K received 54.1% of the vote. The suit contends that the measure needed a two-thirds voter approval to become law.

The suit’s plaintiffs are Howard Jarvis Taxpayers Association (HJTA), a nonprofit public benefit corporation comprised of over 200,000 taxpayers, Charlie Mathews, a local rice farmer and businessman, and John Mistler, former Yuba County Supervisor and owner of the Territorial Dispatch weekly newspaper. Defendants are the County of Yuba, its Supervisors, and the California Department of Tax and Fee Administration.

54.1% – no wonder the Yuba County Board of Supervisors  decided to cheat! They knew they could not get the required two/thirds. 

Binninger also raises the question of using public funds to run a tax measure campaign.

“The suit does not address the county’s biased media campaign or the use of hundreds of thousands of taxpayer dollars to sway voters. Measure K opponents argued that both were illegal. The California Fair Political Practices Commission has jurisdiction over where monies are derived and how they are used for a campaign.”

The city of Chico is currently using hundreds of thousands of taxpayer dollars to mount a revenue measure campaign, not only in $taff time, but in consultants. The Chico Area Recreation District has already hired various consultants, spending over $100,000 that I know of, to put their own revenue measure on the ballot. The school district has run at least four bond campaigns using taxpayer money. 

We need to hold city of Chico and CARD staff up to the law. We need to be ready to make our own complaints to the FPPC and court. And we need to be ready to take it beyond Butte County, because the county of Butte is not likely to take such complaints seriously – they’re in the same boat with Chico!

 

Text tax dropped – what will they try next?

17 Dec

Wow, it was good to see people get their panties in a  rumple over the “text tax” – upset the lobster pot a little.

Meanwhile, according to Rueters, “protesters angry over gas taxes and the high cost of living have been blocking roads across France, impeding access to fuel depots, shopping malls and some airports.” People have been killed, I don’t know how many. An organizer complained on Deutsch Welle News that the government is leaving Parisiens like her with less money to spend, small businesses are failing as a result of both high gas prices and low sales. The French economy, she concluded, is tanking because of over taxation.  

Welcome to California. The California Public Utilities Commission, saying they want to use the money to support “low-income” programs, tried to tack another tax onto our cell service, wiggle it in among the stack of “fees” already listed in the fine print on the back of our bill. Thank goodness for the Federal Communications Commission, although, I don’t understand the ruling, I’ll take it. I don’t think they should be able to tax us by way of our utility bills, but I’m not running the circus.

And what a circus it is! Our taxes already provide transients with free cell phones, give me another straw for my camel’s back why don’t you? 

How soon we forget – I almost have. In 2012, the city of Chico tried to get the voters to approve a tax they’d been collecting illegally, a cell phone tax. Even after the tax had been declared illegal by way of a lawsuit in the 1990’s, cities all over California were still collecting it, the same man had to sue each city individually, including Chico, to make them stop collecting it. Instead of stopping collection, and refunding the money to users as is the law, current city councilor and former mayor Ann Schwab wrote a measure for the 2012 ballot to trick voters into making it legal. 

When friends and I approached voters at venues like the Chico Farmer’s Market, we were shocked to see how shocked people were about this tax – they’d never looked very closely at their bills. And you had to look very closely. So they couldn’t believe the city was actually taxing their cell phone usage, on a percentage of the total bill. They got mad pretty fast. The measure failed. The city had to give refunds. 

That scam and this recent ploy by the CPUC to tack another tax onto our phone bills reminds me – they know what’s legal and illegal, and they don’t care. They will try anything to get more revenues. Right now the city of Chico and CARD are using taxpayer money to hire consultants who conduct “surveys” and write leading ballot measures to try and trick the voters into raising their own taxes. Don’t fall for it. And write your letters to the editor now, tell them you’re not falling for it. Maybe we can save them (ourselves) the cost of another ballot measure.

 

Garry Cooper: “Ask them where all the money you paid already went.”

11 Oct

When I attended a Finance Committee meeting a couple of weeks ago, to hear Mark Sorensen’s plans to foist a bond on us for more pension fodder, I tried to raise a few questions about how our streets and roads are maintained now, how that’s paid for, and why the taxes we already pay are not sufficient. I asked about new roads I saw going in at new subdivisions off Hwy 32 and Bruce Road, and about road widenings provided for those subdivisions. The road widenings on Hwy 32 and Bruce were specifically necessitated by the Forgarty and Meriam Park subdivisions, as per a threatened lawsuit from CalTrans.

Before chair Mark Sorensen could tell me to shut up, I got staff to report that the Forgarty streets were paid for with $6 million in Redevelopment Agency funding, or RDA. RDA is borrowed bond money, it’s estimated to cost $3 in interest for every dollar spent. 

I have to wonder, how much RDA money went into those new streets at Meriam Park?

Soooo many questions – and too many people like Sorensen telling me “that’s enough, Ms. Sumner!” (Ah, in friendlier days, it was “That’s enough Juanita!”)

That meeting was pretty contentious. When tax advocate Stephanie Taber went on a ramble about how “the liberals”spent all the money and that’s why we need a new tax for street maintenance, committee member Randal Stone came across the table at her, looking like he wanted to grind her bones to make his bread, saying, “I don’t know which council you’re talking about, but we inherited the streets…” 

All I know is, the city of Chico has come after three of my houses in the county, telling me and my neighbors we’d get better services if we’d agree to annexation. We weren’t really told our rights – it’s actually doable to fight annexation, a neighborhood protest could overturn it. But we were led to believe it wasn’t fightable, so we rolled. I remember Dan Nguyen-Tan telling me, “just think, you’ll be able to vote in city council elections…”

And then we watched the streets in front of all three houses go to hell without maintenance. Here’s the thing – at House #2, the county started a resurfacing job. We were right off Palmetto, and the county had come in, taken it down to the base, and was about 2/3’s of the way through the job when the city annexation went into effect. They supposedly had an agreement that the city would redo gutters, curbs, sidewalks and the ends of driveways, which were left hanging a good 10 – 12 inches above the surface of the new street. We waited and waited, but the city didn’t come. We used our neighbor’s sideyard, with permission, to  get into our driveway. Three households driving across this woman’s side yard to access their houses. 

And then one night a neighbor on our street had a stroke. The ambulance could not get to her driveway, and had to run across neighbors’ yards with the gurney to get her out. She was about 95 years old. She died.

I called the city to tell them what happened, and the  guy who answered the phone was very flustered and apologetic – he didn’t know our street had not been completed.

Welcome to the city of Cheeeko!

The city has long had a policy of pay the pensions first, and worry about service later. In about 2006 then city manager Tom Lando floated a memo of understanding, signed by council, linking city salaries and benefits to “revenue increases, but not decreases…” 

Read that a  couple of times.

Salaries went up, 14, 19, 22 percent! Every year, until we figured it out. We started a collective bitch. The council responded by signing new mou’s – this time, they agreed to pay the employee share of benefits. For years management, along with PD and Fire, paid nothing, absolutely nothing, toward pensions of 70 – 90 percent of their highest years wages. Salaries had gone up – for example, Lando’s salary went from about $65,000 a year to over $100,000. By the time he retired he was making about $180,000 a year. His successor came in at $190,000/year. Now Mark Orme is making over $220,000 a year. 

We raised the collective bitch again, and they agreed to pay some of their benefits. Oh my, 4 percent! Well aren’t you special! So council gave them raises to cover the new payments. All’s well that ends with a  good public screwing!

We pay over 30 percent of their benefits now, add their 4 – 9 percent, and CalPERS wants 50 percent. For now – as time goes by, with CalPERS questionable investment policies, they will eventually want the full 100 percent. So begins the arm-wrestling match over who pays.

Mark Sorensen wants the taxpayers to foot the bill. Ask him why – I’ll answer that – because Mr. Sorensen has wrangled himself a sweet little job as city manager of the nonsense town of Biggs. That makes him a ward of CalPERS. While he doesn’t make half the salary Orme makes, he still depends on those benefits, he’s  got a growing family and a big old gated mansion to take care of. So he’s a soldier for CalPERS. 

The consultant who attended the meeting had all kinds of ideas about getting the public to go along with this scam. But his one warning was, tax measures are hard to pass, and opposition can overturn their little rowboat. The consultant actually suggested that they identify possible opponents and try to smooth them over – promise them stuff!   Get somebody else from the community to invite them out for coffee and snacks, and try to talk them out of opposing.

And, like consultants I’ve listened to at Chico Area Recreation District meetings, he said it was important to keep the measure a secret as long as possible, while surveying selected recipients – they use demographics to find out who is most likely to go along, and they call those people. One CARD consultant said it was very important not to include negative comments in surveys. 

At that point, having wasted enough of my morning, I got out of my chair, picked up my stuff, smiled at Sorensen, and walked out of the little stuffy room. As I walked out I said, very clearly, “there will be opposition, you can count on it.” 

And I was right. I’ve never met Garry Cooper in my life, I’ve never spoken to him, he’s never come to my blog or commented on my letters when we had Topix. So I was surprised and glad when he wrote the following letter to yesterday’s Enterprise Record.

 

The city of Chico wants to ask you to pony up tens of millions of dollars to repair the roads.

Ask them where all the money you paid already went. They will point out that about 80 percent of your money went to salaries of the public unions who, upon every election, donate generously and tout their valuable “endorsements” to the candidates most likely to give them better hikes in wages and benefits.

For instance, you have firemen in Chico bringing in over $200,000 and with base salaries of over $150,000, who are allowed to retire at age 55 with 90 percent of that for life. Most have rental homes and IRAs due to their generous salaries. You, the working class hero, who must work until 65 to get your average $1,200 Social Security retirement, are being asked to pony up more. Is that fair?

Sure, they will claim firefighting is dangerous, but so is roofing, operating heavy equipment, truck driving, and working on oil rigs. Just the stress of struggling by the average Joe in Chico whose salary is in the $30,000 range puts more pressure on one’s heart than those who hop in their $60,000 pickup and tow their $50,000 RV to fish on their days off after collecting their rents from you.

I have no problem with wealth and income, but getting your riches on the backs of the the poor by bribing politicians is wrong. These union agreements are illegal and voidable.

— Garry Cooper, Durham