David Crane: “POBs are meritless products deliberately misnamed by bankers in search of fees. Just say no.”

7 Dec

Thank Dave for sending me this “5 minute read” on Pension Obligation Bonds from David Crane. It’s certainly worth more discussion.

https://davidgcrane.medium.com/pobs-bankers-as-pushers-f0963bf853b8

David Crane

David Crane

LecturerLecturer in Public Policy

About

David Crane is a lecturer in Public Policy at Stanford University and president of Govern for California. From 2004-2010 he served as a special adviser to Governor Arnold Schwarzenegger and from 1979-2003 he was a partner at Babcock & Brown, a financial services company. Crane also serves on the board of the Goldman School of Public Policy at the University of California and formerly served on the University of California Board of Regents and as a director of the California State Teachers Retirement System, Environmental Defense Fund, and the Volcker-Ravitch Task Force on the State Budget Crisis.

While I have no formal background in finance, I think it’s obvious that POB’s are a scam that is only going to benefit pensioners and bond holders. But maybe people would rather hear it from a guy with many degrees and respectable credentials. Crane puts it very simply, “Pension Obligation Bonds (POBs) do NOT reduce pension obligations.”

“POBs would be a truthful title if the bonds actually reduced pension obligations. But they don’t. All they do is increase pension assets, which produces an accounting benefit (more assets — the same liabilities = a lower unfunded liability). Economically, a POB is no more than a “carry trade,” which is borrowing at a low rate to bet on hopefully-higher-yielding assets (e.g. stocks, private equity, hedge funds, etc). Not surprisingly, Wall Street also sells and manages those products.”

And here’s an important point – these bonds are SOLD to public agencies by bond managers, people who make a lot of money selling and managing these bonds. Read on. 

“When the smoke clears, a POB issuer has (i) the same pension obligations it had before, (ii) more debt, (iii) paid investment banking fees, and (iv) gambled the proceeds on products that beget even more fees for bankers.”

That seems pretty clear to me, even a housewife can see what’s going on here. You must wonder, are there kickbacks to city staffers? 

Crane concludes, “POBs are meritless products deliberately misnamed by bankers in search of fees. Just say no.”

That’s right, say it loud, and say it now. Besides sending emails to your newly elected “fiscally conservative” council, you can comment in the consent agenda at Chico Engaged:

https://chico-ca.granicusideas.com/meetings/349-12-slash-1-slash-20-postponed-to-12-slash-8-slash-20-city-council-meeting/agenda_items/5fbdb04ff395e7fe1d013e64-2-consent-agenda-all-matters-listed-under-the

And, Mike Wolcott is looking for “Pro vs Con” writers to argue issues like this – you can reach him at mwolcott@chicoer.com

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Sean Morgan’s temper just cost the city of Chico $50,000

6 Dec

I won’t rehash the incident, but want to call Sean Morgan on the carpet for costing the city $50,000.

https://www.mynspr.org/post/city-chico-settles-lawsuit-over-man-s-arrest-during-city-council-meeting#stream/0

He could have let Mark Herrera have his 3 minutes – 3 minutes! – to express his feelings about a local political action committee, but Sean Morgan lost his temper and had the man arrested. Why? Because Herrera was insulting local political gadfly Rob Berry. “Human paraquat”. Not even an obscenity. I could think of other insults – how about, “PG&E LAWYER!” When I mentioned that in another blog Berry actually came to my mailbox flailing and simpering. I won’t let him threaten me again. You worked for PG&E and you know it Rob, it’s right in your “Linked In”. 

But Morgan gets a lot of money from Berry and his friends, so he thinks he is entitled to have somebody arrested for an insult. Then Morgan went on to libel Herrera by declaring him drunk in public just because the man has a different point of view. Is that what we can expect from our new “fiscally conservative” council? 

Morgan’s the same guy who, when faced with a line at a local fast food joint, hurled a half-empty coffee cup at the counter, exclaimed the “f” word, and stomped out. This guy and his friends are now running our city. That would include little miss pawn star Teri Dubose. 

Sean, you need to keep your head, cause if you cost us any more money, I’m going to sue you. I really think you should pony up the $50,000 out of your own pocket. 

And here’s a stinger – that $50 grand doesn’t include attorney’s fees. 

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While our town struggles with financial insolvency and sagging infrastructure, the staffers responsible skip off to another town, at a higher salary, with their pensions intact

3 Dec

A few points I’d like to make clear about POBs:

  1. amount to millions in new debt, with interest
  2. success dependent on the stock market, just like CalPERS investments
  3. don’t need voter approval but the voters/taxpayers will be on the hook for the payment
  4. POBs are guaranteed – that means, the payments come out of the General Fund at the expense of infrastructure and services
  5. without true pension reform POBs will lead to insolvency and bankruptcy – as was the case in Stockton and San Bernardino

Here’s a shocking article about San Bernardino, 

San Bernardino deficits grow after bankruptcy

What I get from this article, is that the police unions are the biggest threat to financial solvency facing California cities. They demand higher salaries and refuse to pay a sustainable share of their pensions costs. Instead of asking for concessions from the highest paid public employees in the state, “Stockton said from the outset pensions are necessary to be competitive in the job market, particularly for police.”  Vallejo backed down from pension reform after being threatened by CalPERS. 

Chico City Council has done same. When I asked my district rep Kasey Reynolds why such a high salary for the new police chief (higher than the departing chief), she responded, “ I just looked at other communities that are like size and their Chiefs are 20-40k higher.”  I sent her the publicpay.gov records for Chico and Sacramento – yeah, Sacramento salaries are a little higher, but city of Chico pays more of the pensions. If we are going to continue to offer these crazy salaries, Chico cops need to pay more toward their pensions. I never got any response from Reynolds.  They hired the chief above the old salary and just recently approved a new contract for CPOA without asking any concessions. 

So, letter writer Steve Wolfe is correct – our elected officials are complicit with our city employees in driving our town into the financial abyss. He’s right again when he predicts the city will pursue a new revenue scheme.  A POB would be just the vehicle to take us down! Here’s my response. 

Steve Wolfe is right – the city is seeking a new revenue measure. At the Finance Committee meeting September 23, a consultant was asked to pitch Pension Obligation Bonds to the full Chico City council. Staff said the bond could be implemented as early as January 2021 because POBs don’t require voter approval. 

POBs are a way of borrowing money to pay bills, while hoping to re-invest the borrowed money, producing a profit used not only to service the bond but to pay off the pension liability. If this outright gamble doesn’t work out, the taxpayers are on the hook not only for the unfunded pension liability, but the additional bond debt. POBs put Stockton and San Bernardino into bankruptcy.

This bond will not appear on your property taxes, it appears in the form of sagging infrastructure and service cuts – these bonds are guaranteed, bond holders take priority over our streets, our parks, our sewers and even public safety needs. 

Instead of taking on new debt, we must reduce the long-term cost of public pensions for future employees. That’s not happening.  With emergency powers, the city manager hired three new positions this year at $100,000+ salaries. New hires are paid more than predecessors.  There’s no accountability for these decisions.  While our town struggles with financial insolvency and sagging infrastructure, the staffers responsible skip off to another town, at a higher salary, with their pensions intact. 

Contact your new, “fiscally conservative” council super majority, and tell them what you think. 

 

 

 

 

 

 

 

 

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City’s proposed “park rules” ordinance needs more teeth

30 Nov
Tomorrow night our new council will discuss the difference between a “resolution” and an “ordinance”.  If you’ve never read Chico Municipal Code, now’s the time. Here’s a link to the section that will be discussed tonight.
 
According to the Staff report, you can’t enforce a “resolution,” it’s really more of a suggestion, apparently.  
 
 
“regulations in the City’s Municipal Code listed in Title 12R regarding rules and regulations related to City Parks and Playgrounds cannot be enforced by initiating criminal proceedings because they were adopted by resolution and not ordinance. This action will allow additional enforcement tools to address rules and regulations of the parks which are already on the books.”
 
The word “enforcement” comes up 11 times in the report and ordinance, with promises of criminal proceedings “by codifying such rules under the enforcement provisions of the Chico Municipal Code by ordinance., but the exact details of how they will enforce the ordinance never come up in either the report or the text of the ordinance. 
 
“Government Code Section 36900(a) states that violation of ‘a city ordinance is a misdemeanor unless by ordinance it is made an infraction. The violation of a city ordinance may be prosecuted by city authorities in the name of the people of the State of California or redressed by civil action.'”
 
And there it is, “may be”.
 
Hey, I don’t invent this crap, as I’ve been accused, I just cut-and-paste it out of city documents that are available for everybody to read. Unfortunately, judging from comments made on Engaged! Chico, nobody read the ordinance, they just assume it’s going to be a slam dunk and the tents will disappear from the park as soon as the meeting is over. 
 
From Chico Engaged:
 
“I 100% support getting back to enforcing our ordinances which will allow all of us to enjoy our beautiful natural resources together. I am pleased to see items such as this one on the agenda and look forward to its successful implementation! Thank you.”
 
“I fully support enforcement of our laws and ordinances, including in our parks and playgrounds. Let’s get back to not allowing camping, drug use, drinking, etc. in our parks. It’s time they become usable again by the law abiding citizens of this town.”
 
I have to ask these folks – what exactly do you 100%, fully support? Did you read ANY of the ordinance? The staff report promises, “violations of park rules and regulations may be enforced through not only administrative and civil code enforcement but also by criminal code enforcement and charging of violators with misdemeanors under the Chico Municipal Code.”  
 
I believe the words “may be” indicate this decision is up to the officer on scene, meaning, this ordinance is still discretionary. 
 
According to uslegal.com, “Discretion is the power of a judge, public official or a private party (under authority given by contract, trust or will) to make decisions on various matters based on his/her opinion within general legal guidelines. It is a public official’s power to act in certain circumstances according to personal judgment.”  Any city employee is considered a “public official.“
 
 So I went back to current municipal code, where it’s made pretty clear:
 
 
The park rangers shall be primarily responsible for enforcing the park rules and regulations adopted in this title, subject to the direction and control of the director. However, the park rangers, shall, from time to time, be assisted in enforcing the park  rules and regulations adopted in this title by city police officers.

A violation of the park rules and regulations adopted in this title shall be an infraction punishable by a fine in the manner provided for by Section 1505 of the Charter of the City of Chico.

A fine. Wow, I’m sure transients across Chico are shaking in their stolen boots. Take a look at Section 1505 of the city charter.

Section 1505.   Violations; penalties.
 
A violation of any provision of this Charter or of any ordinance or resolution of the city, or any order issued by any officer, agent or employee of the city pursuant to such ordinance or resolution shall be deemed an infraction unless such provision shall otherwise provide that such violation is a misdemeanor. All infractions shall be punished by a fine not exceeding one thousand dollars ($1,000.00) or as set by ordinance, and all misdemeanors shall be punished by a fine and/or imprisonment not exceeding the maximum penalty allowed under the general laws of the state for misdemeanors. A minimum penalty, not in excess of the maximum penalty provided for herein, may be adopted by ordinance with respect to any particular violation.
 
There it is – “a fine and/or imprisonment…” which is determined at the discretion of a city official. It also says “A minimum penalty, not in excess of the maximum penalty provided for herein, may be adopted by ordinance with respect to any particular violation.”
 
Read the ordinance yourself – there is no “maximum penalty” or any specific action listed in this ordinance. There’s nothing about repeat offenders, nothing about indecent exposure or defecating on the creek, nothing about vandalism or theft. But, here’s an irony – the next agenda item is an ordinance against dumping and prostitution, with specific fines and even threat of arrest. 
 
So, I’ll call this ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CHICO, AMENDING TITLE 12 OF THE CHICO MUNICIPAL CODE BY ADDING CHAPTER 12.18, PARK RULES AND REGULATIONS what it is – another discretionary law that will not be enforced. Just like “sit and lie”.  
 
Of course, this is an “urgency” ordinance, and they’ve put a sunset of “no more than 6 months” on it. So, it’s still in the works. You still have time to chime in on Engaged! and ask them to put some teeth in their new chihuahua. 

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EDD paying out “millions” in fraudulent claims – who you gonna blame? Sign the petition to recall Governor Newsom

30 Nov

Monday after Thanksgiving weekend – almost like a hangover, huh? Tired of turkey, tired of the relatives, tired of sleeping and watching tv – time to bust out and start the week right! If you haven’t signed the petition to recall Gavin Newsom, maybe four days of house arrest might have been just what you needed.

Remember, you can print the petition out, sign it, and send it back –

https://recallgavin2020.com/petition/

But if you are craving human interaction, there are businesses around town that have petitions for you to sign, or will take your petition to send in for you. You want to support local business? Sign this petition.

https://recallgavin2020.com/county/butte/

Every now and then, there is a signing “event”, I’ll try to keep you posted of those. Butte County proponents need a little over 10,000 signatures by March 2021, and they have collected over 6,000. This is DOABLE!

Newsom is tanking our state, the most recent example – the scandal at the Employment Development Department.

https://www.msn.com/en-us/news/crime/6-things-to-know-about-edd-fraud-involving-california-inmates/ar-BB1bkCpj

First let’s remember that old Yiddish proverb – “When the fish stinks, it’s the head of the fish that stinks.” Let’s make this clear – the governor is the head of the California fish. Now read this shocking story from the California Globe.

https://californiaglobe.com/section-2/california-edd-sent-millions-in-unemployment-benefits-to-inmates-in-jails-and-prisons/

“Tuesday District Attorneys from across California joined together for a press briefing hosted by Sacramento County DA Anne Marie Schubert and El Dorado County DA Vern Pierson, to expose the massive unemployment benefits fraud in jails and prisons in California. “This is perhaps the biggest fraud on taxpayers in California history,” DA Schubert said.”

According to KCRA news, https://www.msn.com/en-us/news/crime/6-things-to-know-about-edd-fraud-involving-california-inmates/ar-BB1bkCpj

“Sacramento County District Attorney Anne Marie Schubert, who heads the EDD Fraud Task Force, said tens of thousands of inmates are accused of scamming EDD, claiming upwards of $1 billion in unemployment already paid in their names.”

The big problem being, they are too quick to blame it on the inmates and their outside cohorts –

“The task force said the fraud exists in every California Department of Corrections and Rehabilitation institution at the local, state and federal level — and includes inmates who were convicted of various crimes.“

How could this be possible without the cooperation of the employees who run these departments?

“The task force said the fraud includes lone actors, organized rings and identity theft. Schubert believes the fraud was relatively easy because unlike 35 states, California did not regularly crosscheck EDD claims with prison rolls.”

There you have it – as with so many other public programs in California, there is no oversight. And that’s not only on the governor, but on the Attorney General, Javier Becerra. Becerra, like his predecessor Kamala Harris, has overlooked this scandal. Is that incompetence, or what?

And here’s what really stinks – “We’ve been hearing about fraudulent unemployment claims since the coronavirus pandemic lockdown was first ordered by Gov. Gavin Newsom in March. However, millions and quite possibly billions of dollars has been sent to inmates in California’s county jails, and state and federal prisons, while legitimate claimants are stiffed for months.“

I know two people with legitimate claims for unemployment who have not had any satisfaction out of the EDD. They get a recording and no calls back on their months old claims, meanwhile, the county continues to shut down their jobs. How many people do you know that have tried to navigate the unemployment process without any success? We know the EDD is incompetent, can malfeasance be far behind?

This all comes down from the stinking head, Gavin Newsom. Get out there and sign that petition today.

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Tips for Turkey Day

25 Nov

Yesterday my husband and I went out to pick up groceries for the weekend. We found ourselves surrounded by tourists. Here we are in the Purple Tier, and people are still coming to Chico to spend the weekend.

Standing at the deli counter, I was privvy to various conversations. One woman says to the other, “It’s only Tuesday and he’s already bored…” I had to wonder if she was talking about her spouse or a child. Nerves are always raw at Thanksgiving, it’s a weirdly depressing holiday. On the news I’ve seen at least a story a day about the pending mental breakdown – I’ve heard Super Bowl Sunday is the worst day for domestic violence, but I’m going to guess Thanksgiving Thursday is a close second.

Throw in the COVID Crazy and wow – batten down the hatches and shelter in place Folks!

I hate to think, a holiday with such good intentions, has become something we just get through. Here’s my suggestions:

  1. Stop watching the news. “The news” isn’t journalism anymore, it’s government propaganda. The main gist these days is “Be Afraid, Obey, Comply.” It’s almost hypnotic, it interferes with your own train of thought, and makes you paranoid about everything. Try tuning it out this weekend, and maybe it will become a non-habit.
  2. Read a book. If you have kids, read it to/with them. Here’s a few recommendations: “A Christmas Carol,” by Charles Dickens, “Cinderella Man,” by Jeremy Schaap, “The Autobiography of Jim Beckwourth (Mountain Man, Indian Scout, etc) by Jim Beckwourth, “Huckleberry Finn,” by Mark Twain, “A Tree Grows In Brooklyn,” by Betty Smith, “The Long Winter,” by Laura Ingalls Wilder, “The Boys of Summer,” by Roger Kahn. That’s just a short list, but it will keep you busy. Yeah, these are all old books – with old values.
  3. Write letters. This is a lost art, and I notice, my letters are always appreciated. Here’s an idea – sit at the family table and tell everybody you are writing to somebody who couldn’t make it, ask them to chime in. One of my favorite things to do in a letter is draw cartoons of family members or friends, tell what’s going on right in that minute – “Uncle drops the turkey, platter and all…” I get letters back, it’s worth the effort.
  4. Get a joke book, try to make it tasteful, the cornier the better. Make your family laugh. One of my favorites is a collection of stories from old comedians – Orson Bean, Lenny Bruce, Burns and Schreiber, to name a few – it’s not all tasteful, but there’s something in it for everybody. The one that makes everybody laugh is the old Burns and Schreiber cab driver routine – you can find that on youtube, along with some of their other greatest bits.
  5. THINK before you speak. Do you think you really need to bring up that old story about your sister’s/daughter’s/wife’s old boyfriend? You really need to tell that story about your brother-in-law/son/cousin at the dinner table? Is it wise to pick on your family members? THINK!

I think the best thing to remember is pay attention, be sensitive to people’s moods. Try to smile and make others feel better, that always works for me. We let ourselves forget sometimes – it’s good to have family and friends who care about you, make it about them.

Happy Thanksgiving Everybody!

Gavin Newsom has a basic disrespect for the law of the people, luckily Cory Honea knows who he works for

20 Nov

NOTE: I just got an email about a curfew party at City Hall tomorrow night at 10:01 PM – maybe we should bring tea bags to throw in the trout fountain!

Recently longtime political reporter Dan Walters wrote an interesting piece about the powers of the governor earlier this month:

https://calmatters.org/commentary/2020/11/california-governor-emergency-powers-covid-19-court-judge/

“California has been a one-party state for the last decade, with Democratic governors and supermajorities in both legislative houses doing pretty much as they pleased without paying any attention to the relative handful of Republican legislators.

However, one-party rule gave way to one-man rule eight months ago when Gov. Gavin Newsom declared an emergency due to the COVID-19 pandemic, thus empowering himself to govern by decree and suspend any laws that stood in his way.”

Yes, having to sit through the hour-long daily “Fireside Chats” Newsom has been running on the Sacramento news is reminiscent of the stuff we heard about the USSR when I was a kid. I think he’s way overstepped the boundaries of his job. According to Walters,

“In effect, some of those orders essentially made new law and while Democratic lawmakers stood by, two Republican legislators, Kevin Kiley and James Gallagher, filed suit, alleging that Newsom had gone too far.

Last week, Sutter County Superior Court Judge Sarah Heckman sided with the Republicans, declaring that Newsom’s order changing procedures for the November election, including a mandate that every voter be sent a mail ballot, crossed the line.”

While I love voting by mail, Newsom’s order was completely asinine. For whatever reason – I think mostly nostalgia – many people want to go to a public polling place. Around the county and state, people still held on to their ballots, lining up in record numbers outside polling stations, mingling freely, masked and unmasked. Just in case nobody noticed, voting day was followed by surges in new cases all over the state. Hmmmm. 

And we’ve all heard about Newsom’s disregarding his own orders. Note the picture, which shows the party was seated INSIDE the restaurant even as Newsom was restricting Butte County to dining outside in November rain storms. 

https://news.yahoo.com/gavin-newsom-executive-powers-under-130000893.html

Sophia Bollag
·5 min read
 
 

“It was a rough Friday for Gov. Gavin Newsom.

In the morning, news broke that he attended a birthday party with several other households as his administration urges Californians to avoid seeing friends and family. The incident has prompted even some of his supporters to question his judgment and privilege.

The same day, a Sutter County judge finalized a ruling saying he overstepped with some of his executive orders.”

News sources report that it was a birthday party for his campaign manager, and guests included lobbyists. Bad, bad Governor!

This story also mentions the suit from Kiley and Gallagher.

“In their legal challenge to the order, Republican Assemblymen Kevin Kiley and James Gallagher argued that the governor violated the California Constitution by creating a new law, which is the Legislature’s job.

Heckman agreed with Kiley and Gallagher, ruling that the order created a new statute and that Newsom’s action exceeded his authority under the Emergency Services Act.”

Furthermore, “But the judge also issued an injunction against Newsom, saying he can’t make further executive orders that create statute. She also wrote that ‘many’ of Newsom’s other orders – he has issued more than 50 – likely violate the state Constitution by changing ‘statutory law.'”

Would that include the curfew order starting tomorrow at 10PM?

“Newsom has issued executive orders requiring people and businesses to comply with directives from the state’s Department of Public Health. That’s how his shutdown orders and mask mandate work.

The Sutter County ruling doesn’t affect those orders. Separate legal challenges have been filed against many of Newsom’s COVID-19 orders, but they are still working their way through the courts.”

While no judge has made this determination, I’ve read county sheriffs are refusing to enforce the curfew order. 

“The Sacramento County Sheriff’s Office will not be determining—including entering any home or business—compliance with, or enforcing compliance of, any health or emergency orders related to curfews, staying at home, Thanksgiving or other social gatherings inside or outside the home, maximum occupancy, or mask mandates,” [Sheriff Scott] Jones said in a statement released on Thursday.”

“Along with the Sacramento County Sheriff’s Office, the Merced County Sheriff’s Office will not be determining compliance or enforcing any health or emergency orders related to curfews, Thanksgiving, or other social gatherings inside or outside the home, maximum occupancy, or mask mandates in Merced County,” the Merced County Sheriff’s Office stated in a social media post on Thursday night.

The social media post also states, “The Merced County Sheriff’s Office will not dispatch deputies for these purposes, and callers will be directed to County Health Officials.”

But nobody made quite as strong a statement as our own Butte County Sheriff Cory Honea. 

https://www.msn.com/en-us/news/us/covid-curfew-northstate-agencies-say-they-wont-enforce-newsoms-order/ar-BB1bdeRa

“Butte County Sheriff Kory Honea says he finds aspects of the Governor’s order ‘very troubling’ in a statement posted to Facebook Friday.

‘As both Sheriff and a citizen of Butte County, the thought of law enforcement officers peeking into the windows of homes, or stopping and questioning residents regarding their destination and family relationships, merely for being outside of their homes, or visiting the home of another during the nighttime hours, all solely due to the suspicion of violating the ‘Limited Stay at Home Order,’ is very troubling.’

Sheriff Honea says the decision was made to avoid losing the public’s trust, adding that the order has the potential to violate constitutional rights. “

The Shasta County Sheriff, Glenn County Sheriff, and Chico Police Chief Matt Madden have also stated that their departments will not be enforcing the order. 

I think they’re very smart. They know law enforcement needs the support and cooperation of the citizens, and any rational person could see that the citizens are boiling mad and sick of the governors mis-handling of state business. Smart leaders know when they are overstepping the boundaries. 

So, whatever you’re doing on Saturday night at 10:01, you might want to step outside, and let Gavin Newsom know, he’s overstepping his boundaries. 

My dad had a pair of these on his Peterbilt – maybe I’ll get a pair for my truck. 

Plasticolor 000502R01 Yosemite Sam Back Off Easy Fit Mud Guard 11" - Set of 2,Multi-colored

 

 

 

 

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Have you seen the new CPOA proposal?

17 Nov

Tonight is the last meeting of the current city council. The next meeting will begin the new “conservative” SUPER MAJORITY. I just like writing that in all caps, because I don’t know if people realize what it means.

Simply put, it means the five “conservatives” can do whatever they agree to among themselves, and the new “infinitesimal minority” of Brown and Huber will have to sit on their thumbs the next couple of years.

Of course I expect Huber to ingratiate himself with the conservatives.

https://www.youtube.com/watch?v=W4jWAwUb63c

But tonight, the last “elected at large” council will be discussing new contracts for Chico Police Officers Association, the old contract set to expire in December. I’ve been trying to look over the proposals since last week when I got the agenda, but they are onerously huge files that I can’t open with my dinky little internet connection. Why they aren’t displayed at the Human Resources page alongside the expired agreement is beyond me – well, no it’s not, they obviously don’t want us to see it. So, I have not seen the new proposal that will be discussed, in closed session, at tonight’s closed council meeting. 

Have you?  Cause if you go to the city website and direct yourself to the “minutes and agendas” page, look at tonight’s agenda, and then scroll down and open the reports and hit the links, here are some specific items I wish you would look for:

  1. Mandatory overtime
  2. STO
  3. CTO

And then go to this link, below, and re-read this post, because I don’t have time to go over all this again.

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 tried to have this conversation with my district rep, Kasey Reynolds, but she played dumb. I just wrote the following note to the city clerk and asked her to forward it to the full council:

Dani, I know how hard you work, but I can’t download or even preview these documents. 

This is a problem – the public obviously isn’t let in on this conversation. Most people in town don’t have time to look at this stuff – I got it late Thursday, and staff was out of office by Friday noon.  Most people probably wouldn’t understand it if they did read it – they are purposely written in onerous language. I always wonder how many council members really read or understand these contracts. I’m a landlady, I know people just sign stuff without reading it, I often wonder how many council members do that. 

But council continues to agree to stuff like “CTO”, and “STO”, and all the other perks and benies that make these people outrageously over paid. According to Scott Dowell, public safety, especially CPOA, make up over half our UAL. And only pay 12 – 15% toward pensions of 90% of salaries over $100,000, plus perks like getting paid for not working (CTO, STO).

I’m including Mike Wolcott in this email because I’d like to see more about the contracts in the newspaper. This is why our town is tanking. And Staff’s only solution is to put our town over our heads in debt with a Pension Obligation Bond.

Other towns are talking about switching to 401K’s – Chico has already given Orme a 457 Plan in addition to his pension, an extra $20,000 year, while Orme claims no employees have had raises? Orme also got a raise when he agreed to pay his own “employee share,” previously paid in full by the taxpayers. 

Meanwhile, our park is a wreck, our streets are shredded, and crime is outrageous. This is on the “conversative” majority. You guys can’t blame this wreck on the liberals anymore. If you approve the CPOA contracts without any concessions from the union you are putting another nail in our town coffin. 

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Good question Bob: Why do we need to replace Constantin with anyone?

14 Nov

One last word on the departure of Chris Constantin – from a comment Bob left the other day:

Why do we need to replace Constantin with anyone? The truth is the City is over its head in debt and we can’t afford a replacement.

Besides, why should we continue to pay hundreds of thousands of dollars every year for a bureaucrat who does nothing but scheme how to raise our taxes and get us deeper in debt with things like POBs while letting our streets and everything else fall apart.

Wow, good question Bob! So I wrote a letter to the ER about it.

When departing Chico administrator Chris Constantin was hired in 2013, he spoke to the Tea Party. He said our previous finance director was “Loosey Goosey”, bragging about his qualifications to “straighten out the mess” she’d left. He told us, once he fixed things, “you can hire someone cheaper, with less initials behind their name.”

Seven years later, I see a bigger mess. Constantin himself has told us, staff deferred maintenance on streets and other infrastructure while they continued to make bigger payments toward their pension liability (UAL) – this year $11,000,000. But the UAL continues to increase –  this year, the city manager created three new management positions with $100,000+ salaries.

When Brian Nakamura was hired, he went on a firing spree, gutting lower level staffers and bringing his own friends in for management positions – Mark Orme and then Constantin. Since then the assistant manager’s salary has gone from $142,652 to over $189,000/year. Orme and Constantin have also garnered themselves 457 Plans worth an additional $20,000/year each.

From a 2018 report to the California League of Cities: “City pension costs will dramatically increase to unsustainable levels.” Their first suggestion – make more aggressive payments to CalPERS. Meanwhile, “Change service delivery methods and levels of certain public services.” Meaning, squeeze the taxpayers for more money.

Top heavy management and perpetual demands for higher salaries and more benefits has our city upside-down. Constantin’s position should be eliminated, along with other unnecessary management positions, so we can hire the lower-paid workers we need to get this town “straightened out.” 

Juanita Sumner, Chico CA

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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

https://www.pe.com/2012/08/15/hemet-city-manager-accepts-chico-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”?

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