Willmann tries to pretend she doesn’t have anything to say about her own salary

12 Sep

I attended the last “informational” meeting hosted by Chico Area Recreation District General Manager Ann Willmann. What’s interesting about these meetings is watching Willmann put her spin on the truth. 

First of all, although this was the least-attended meeting of the three I’ve been to, the folks who did show up seemed a lot better informed and asked good questions. Second, Willmann has had to incorporate more information into her presentation, obviously in response to questions and comments made over five meetings, as well as my letters to the editor, and, who knows what communications she has received from other members of the public. She’s on the defensive, and it’s not just me that’s putting her there.

I almost laughed out loud when she started into her spiel about CARD losing money over the Camp Fire. She started to explain how the county of Butte puts alllllll the property tax into a big pot, or “bucket”. Then they dip  out 1% of the total and divvy that between all the agencies that receive property tax money, including CARD. So what I hear is, towns that have their own rec districts are paying to support CARD. That’s great. 

But another man interrupted her, reminding everybody the state is “backfilling” that lost money, to the tune of $200,000 a year, for the next three years. Willmann seemed to lose a little bit of steam over that, admitting he was right, but adding that, gee, she just didn’t know what was going to happen after that three years. Well Annie dear, houses will be rebuilt, will be worth more than they were before the fire, and property tax revenues will go up. She knows that, but she is trying to tell us the Camp Fire resulted in less revenues for CARD. She really thinks she can bullshit that point – I was glad to hear somebody who has been paying attention pull the cork out of her ass. 

The questions people raised at this meeting gave me hope.  This parcel tax is not a done deal.  In fact, if there was a stronger response from the public, CARD board members might even decide not to put it on the ballot. Yesterday, as I listened to Willmann give more details about the survey CARD paid EMC to run earlier this year, I became more and more convinced the survey was actually more negative than Willmann is letting on.  CARD board and staff members are desperate to make the public agree to put a new 30 year tax debt on themselves.

The board has allowed themselves to be duped into believing a tax is the only way out of their current pension disaster. Willmann has repeated The Big Lie throughout this lecture series of hers – she sounds like an old mobster – once you’re in CalPERS, you’re IN!  She has a mouse in her pocket – “we” have to buy “our” way out. 

Well, I do believe, if they don’t do something, the agency will become insolvent trying to pay their pension deficit. But, Willmann refuses to talk about the best option – the best for everybody, including the taxpayers. The employees need to start coughing up more money out of their own pocket. They need to start paying 50% of their pension now, and that needs to increase to 80% over the next 10 years. The taxpayers already provide these people with more than generous salaries, to be expected to pay double what we pay in salary by way of these pension bail-out payments is way beyond reason, it’s unsustainable. CARD staff have completely forgotten their mission to serve the public, choosing instead to enrich themselves. 

And here’s another important thing they need to do – take salary freezes now, and when the freeze is over, cap raises at inflation. Inflation averages about 2% a year. General Manager Ann Willmann just took an 11% RAISE, from $113,000/year to $127,000. Her old benefits package was about $29,000 – this will go up, what, another 11%? Remember, this woman has bragged about paying 8% of her pension – 8% of her salary, which would amount to $12,000. For a pension of over $88,000/year, with cost of living increase, for the rest of her life.

Willmann says the pensions are out of her hands? Bullshit. She says “this needs to be handled at the CalPERS level and the legislative level…”

But local gadfly John Merz got to the truth when he asked Willmann, “how’s your union representation?” Yes, full time CARD employees, 35 according to Willmann, are represented by 2 separate unions, divided between management and “workers.” Willmann admitted that “classic” or management members still get their “2% at age 55” formula. I can’t explain the 2% – when I asked Randall Stone to explain it to me he was hostile and refused – but I can explain the “55”  – Willmann can retire at 55, with 70% of her highest year’s salary, which at this point, would amount to almost $90,000/year. With an automatic cost of living increase every year. 

But new employees – PEPRA – would have to wait until age 65. Why’s that?  We saw in the last post how different employee groups and different public agencies pay different amounts. When I asked Willmann about this discrepancy between what CARD pays (14%) and what the city of Chico pays (21 – 31%) and then what the different “bargaining units” pay, she  got kind of flustered, told me I’d have to wait for a member of her staff to get back to me. “I don’t want to spread misinformation…” 

Well, there’s obviously bargaining going on here – that’s why they call them “bargaining units”.  Willmann admitted to Merz that the employees are represented by a paid union member.  Who represents the taxpayers in these bargaining sessions? Three  pensioners (Lando, Nickel and McGinnis), a political operative (Worley) and an idiot who goes whichever way the wind blows (Donnan).

So it’s not, as Willmann would have us believe, up to CalPERS, or up to the legislature. It’s between her and the board, in closed sessions to which the public is not admitted. 

Maybe it’s time to start writing letters directly to the board. 

 

 

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California League of Cities: local agencies cut maintenance because “revenue growth from the improved economy has been absorbed by pension costs”

6 Sep

Let’s have a good laugh, cause we probably need one.

I think that clip is a good analogy of the way public agencies spend money.

Seriously, I’ve been mulling over an article from Edward Ring, a financial analyst, co-founder of the California Policy Center. It’s a good read to get you ready for Halloween. See the link at the bottom of this post. 

Okay kids, turn down the lights and let’s sit around in a circle and see who pees their pants first.

In 2018, the League of California Cities released a “Retirement System Sustainability Study and Findings.”

“Key Findings”:  (1) City pension costs will dramatically increase to unsustainable levels, (2) Rising pension costs will require cities to nearly double the percentage of their general fund dollars they pay to CalPERS, and (3) Cities have few options to address growing pension liabilities.

According to CalPERS “Public Agency Actuarial Valuation Reports,”  over the next six years, participating agencies will need to increase their payments to CalPERS by 87%, from $3.1 billion in the 2017-18 fiscal year to $5.8 billion by the 2024-25 fiscal year.

And that, according to Edward Ring, is a “best case scenario”.   This guy could scare the shit out of Stephen King.

“Bartel Associates used the existing CalPERS’ discount rate and projections for local revenue growth. To the extent CalPERS market return performance and local revenue growth do not achieve those estimates, impacts to local agencies will increase.”

Now remember, the actual authors here are CalPERS and the League of California Cities, Ring is just the storyteller, and I’m just repeating what he says. Here’s what I’ll add – Chico is a member of the LCC, in fact, Mayor Randall Stone has held office in the League. So this story is about Chico.

Ring continues his analysis, “The report from the League of California Cities includes a section entitled “What Cities Can Do Today.” This section merits a read between the lines”

You can go ahead and read his full article yourself, at least he’s got a sense of humor, but I’ll tell you what the league said, as it relates to the city of Chico, as well as Chico Area Recreation District.

1 – “Develop and implement a plan to pay down the city’s Unfunded Actuarial Liability (UAL): Possible methods include shorter amortization periods and pre-payment of cities UAL. This option may only work for cities in a better financial condition.”

Both the city and CARD have already done this. For example, in 2015, CARD ignored a consultant’s report that Shapiro Pool could be saved for about $550,000, instead making a $400,000 side fund payoff to CalPERS.  The city of Chico has also been stepping up their payments, we’ll get to where that comes from in a minute.

2 – “Consider local ballot measures to enhance revenues: Some cities have been successful in passing a measure to increase revenues. Others have been unsuccessful. Given that these are voter approved measures, success varies depending on location.”

The city of Chico and CARD have been hiring consultants to pursue tax measures since 2012. The common factor is former Chico city manager Tom Lando, who has sat on the board at CARD for over 4 years now, and who has also managed the Feather River Park and Rec District in Oroville. Lando is a pensioner, and receives one of the biggest pensions paid out to a city of Chico employee since the death of his predecessor Fred Davis. Of course Lando Man wants CalPERS to be funded.

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

Lando was the guy who floated an MOU in the early 2000’s to attach city salaries to revenue increases “but not decreases“. Ring discusses such measures.  We’ll discuss that later.

3 – “Create a Pension Rate Stabilization Program (PRSP): Establishing and funding a local Section 115 Trust Fund can help offset unanticipated spikes in employer contributions. Initial funds still must be identified. Again, this is an option that may work for cities that are in a better financial condition.”

Back to #1.  Despite claims that they are in poor financial condition,  both local agencies have established such programs, and have been siphoning money that should have gone into maintenance and capital projects to “step up their payments” into their pensions. That leads to # 4.

4 – “Change service delivery methods and levels of certain public services: Many cities have already consolidated and cut local services during the Great Recession and have not been able to restore those service levels. Often, revenue growth from the improved economy has been absorbed by pension costs. The next round of service cuts will be even harder.”

That’s where I had to stop reading for about a week, I felt like my blood pressure was going to blow my eyeballs out of my head. This is the evidence, I mean, we all knew it. This is where they admit it.  ” revenue growth from the improved economy has been absorbed by pension costs.”  We’ve been lied to – the economy has been improving but the public employees have been stealing all the money for their pensions. And now, as Chico Assistant Manager Chris Constantin has been threatening in his presentations, “The next round of service cuts will be even harder.” You know it and I know it – they’ve been screwing us on purpose. Think Bridgegate.

5. “Use procedures and transparent bargaining to increase employee pension contributions:  Many local agencies and their employee organizations have already entered into such agreements.”

Ring says,   “(reading between the lines) – MAKE BENEFICIARIES PAY MORE. Good idea. The League of California Cities might expand on the feasibility of this recommendation and provide examples of where it actually happened (cases where employees agreed to pay more towards their pension benefits but received an equivalent pay increase do not count)”

Yeah, cases where employees agreed to pay more towards their pension benefits but received an equivalent pay increase do not count.  Ann Willmann of CARD and city of Chico management have all been given raises to more than cover their “extra shares”. And now, only now, “classified” CARD employees (management) pay 8%, and PEPRA (essentially, non-management employees) only pay 5.5% of the total agency contribution of 14%. City employees pay confusing shares, covered below.

The Public Employee Pension Reform Act (PEPRA) supposedly requires all employees pay 50% of agency costs. CARD “classic” staff has agreed to pay 1% more. I don’t know why CARD PEPRA employees are only paying 5..5%, they may still be phasing in.  

City of Chico employees have a totally different set-up, which confirms that the individual boards and employees have a lot more to say about this arrangement than either Chris Constantin or Ann Willmann will admit. 

I asked City Finance Mangler Scott Dowell (formerly with CARD, there’s just so much footsie in local government) what the shares were.  According to Dowell, the city pays different amounts for “miscellaneous” (everybody who is not a cop or  firefighter) employees and “public safety”, as well as “classic” and “PEPRA”.  Pay attention.

While CARD pays 14% total on all employees, City of Chico pays a  total of 21% for miscellaneous classic  and 20% for PEPRA.  For public safety employees (CPOA, IAFF), the city pays 31% for classic, and  33% for PEPRA. The employer/employee split is as follows:

  • miscellaneous employees: classic – employer cost  10.235%,  employee cost 11%;  PEPRA –  employer cost 10.235%   employee cost  9.75%
  • public safety: classic – employer cost 18.843%, employee cost 12%;  PEPRA – employer cost  18.843%, employee cost 15%

Dowell says the figures above include a 3% share of “employer cost” paid by employees. That’s confusing. That would make the “employee share” less than half the total cost. According to PEPRA, shouldn’t they just be paying half? Why say they are paying 3% of the employer’s share, and it only amounts to half? And, management (classic) make big yaya about paying 1% of “employer cost” – but PEPRA pay less than the employer share? What the heck?

Dowell also said that CPSA (public safety) employees pay 6% of “employer cost”. What? He says that is included in the figures above. You see, both classic and PEPRA public safety employees pay less than half.  And that includes 6% of the “employer cost”? What? Look – fire department classic members are paying 12% to the city’s 18.843% (19%). That’s not 50% of total costs. Do they think we don’t know the math?

So that all leads to the POB – pension obligation bond.

 6 – “Issue a pension obligation bond (POB): However, financial experts including the Government Finance Officers Association (GFOA) strongly discourage local agencies from issuing POBs. Moreover, this approach only delays and compounds the inevitable financial impacts.”

Both the city of Chico and CARD have said they will use the proceeds from their proposed tax measures to secure a bond. What kind of bond they have not specified, but I don’t know if they need voter approval to do this. Constantin has suggested issuing bonds for road and street maintenance. Whether or not Contantin is lying, here’s Ring’s analysis:

6 (reading between the lines) – GO INTO DEBT TO PAY OFF DEBT. Pension obligation bonds are at best a dangerous gamble, at worst a deceptive scam. The recommendation itself (above) dismisses itself in the final sentence, where it states “this approach only delays and compounds the inevitable financial impacts.”

Yeah, going into debt to pay off debt. I think the old people called that “robbing Peter to pay Paul.”

Ring makes an interesting observation. “Not everyone wants to blow up the defined benefit system,”  referring to the CalPERS’ model of guaranteed payouts.

“I think defined benefit is a tremendous opportunity. It can be sustainable. It was sustainable. And then they jacked up all the benefits by 50 percent and made it retroactive — basically doubled liability overnight. Now, they’re not sustainable. Make them sustainable again.”

Look back to #2 – that’s where Tom Lando, in the early 2000’s, pushed through a “memo of understanding”, getting a weak and stupid bunch of council members to sign off on attaching salaries to revenue increases “but not decreases”. That guy is the head of a very foul smelling fish.

Ring is a good read, he’s written extensively on this crises, how we got here, and how he thinks we can get out. 

https://search.yahoo.com/search?fr=mcafee&type=E2 LLP11US105G10&p=Edward+Ring+-+how+to+make+CalPERS+sustainable+again

How to Restore Financial Sustainability to Public Pensions

Bill, Bill, Bill – you need to listen more carefully next time

4 Sep

My grandparents were rice and nut farmers over in Glenn County, where we spent much of our childhood at their “ranch”. My grandma kept a nice yard, lots of flowers, and she couldn’t stand gophers. When we’d find a mound or a hole in the yard, we’d run in to get Gram, and she’d load a round into her old shot gun and follow us out into the yard.

Shooting gophers is a waiting game. Gram would locate the other holes, the “breathers,” and she’d set a hose in one, and then the cats and dog would take up another post, and then my grandma would set the barrel of that Remington right into that main hole. We’d watch, and then we’d wait, and then all the sudden, KA-BAAAAMMM! Gopher bits. And she’d then turn off the hose with a happy “By Gum!”, shoulder her shotgun, and go back in the house. 

Sorry for what some people might find a violent analogy, but what I wanted you to get out of it was the patience it takes to stop something from undermining your community and everything you’ve worked for. You have to watch, and you have to wait, and then you have to jump right on it, don’t let up, keep at it until you beat it. 

So I’ve been watching Chico Area Recreation District (CARD) and the city of Chico  for years now, since about 2012, since Tom Lando, former city manager and consultant who now sits on the CARD board, first floated a survey to determine the voters’ willingness to tax themselves. It came back embarrassingly negative. A subsequent CARD survey came back – “not enough support for a tax measure” was what that consultant said. But CARD kept spending money on consultants, finally going with the company that got the last school bond measure passed, EMC of Oakland. Their first survey was negative, but CARD paid for another just this year, and now they say there is enough support in the community to put a tax measure on the March 2020 ballot.

Really? Well, why didn’t they float a petition? The signatures they gathered would have been proof of people’s willingness to tax themselves. But you know they never would have got sufficient signatures, so they hired a company with money they should have put into maintenance and services to call 400 carefully chosen “respondents” with carefully written questions that would lead anybody to believe they needed to tax themselves. A company that boasts about getting tax measures passed.

I watched this unfold, none of it has been a surprise. And, I been waiting, and I’m ready to stand over their little holes, and hit them with the truth. KA-BAMM! Here’s another round. 

Bill Smith says the state has put CARD in a “tough spot”, restricting the agency to raising funds either through program user fees or public indebtedness – parcel taxes and bonds.  If he’d listened more carefully, he’d realize that CalPERS and CARD staff and board have put CARD, and the taxpayers, in  that spot. 

CARD’s General Manager stated at each meeting that staff has deferred maintenance on district infrastructure for years but continued to move money into their “pension liability reserve.” In fact, CARD’s 2019-20 budget shows a transfer of $700,000 into the reserve fund, and a $261,748 “side fund” payment toward their $2,800,000 pension liability. Remember, that’s in addition to the 6 – 9% of salary the agency pays monthly for each employee.

CARD’s budgets show that the revenues they receive from the  county – mainly property taxes and development impact fees – are up 8% over the last year.  Program user fees are up 9%. New subdivisions currently in the permits process, including those in the Camp Fire burn scar, will bring millions more in development impact fees and new property taxes.  These increases in revenue should be sufficient to provide for the future, since expenditures for services and supplies have only gone up 9%.

Meanwhile, salaries and benefits are up 11%, with no new employees. In fact, CARD’s General Manager, who only pays 8% toward a pension of nearly $100,000 a year, received a salary increase at the August board meeting, to $127,000/yr, further increasing the pension liability.

CARD’s current finances are unsustainable, and no parcel tax is ever going to suffice.

 

Bill Smith: The state has put CARD in a tough spot

2 Sep

I was glad to see some discussion of the CARD parcel tax measure in the ER letters section:

Enterprise Record, 9/1/2019

I attended a CARD meeting about the proposed parcel tax. CARD is in a tough position, the state legislature does not allow them to raise monies via a sales tax or gas tax, its only by parcel tax or user fee. I also understand CARD user fees are probably already at what the market will bear.

What bothers me is the inequality. Roughly half of Chico’s pre Camp Fire populations owns property, they would end up paying the recreation tax if approved. Yet the other half that don’t own property plus the displaced Paradisians that are qualified to vote, get to vote, on a  tax they won’t have to pay if passed.

It’s the inequality that I can’t stand, not the recreation fee itself. The state has put CARD in a tough spot.

Bill Smith, Chico

Well, I’m glad to hear somebody is attending these meetings. I’ve been to two and attendance was less than 20 people, including local media, CARD staff and staffers from other local public agencies.

Smith says the state has put CARD in a tough position, restricting the agency to raising funding by way of program user fees or public indebtedness – parcel taxes and bonds.

If Smith attended the meeting then he knows about CARD’s pension deficit – over $2.8 million. He knows CalPERS and the employees have put CARD, and the taxpayers, in a tough position. Willmann stood up there and told us, without batting an eye, that for years now CARD has deferred maintenance on district infrastructure but continued to move money into their “pension liability reserve.” In fact, their 2019-20 budget shows an allocation of $700,000 into the reserve fund, and a $261,748 “side fund” payment to CalPERS. Again, I’ll remind everybody – that’s in addition to the 6 – 9% of salary they pay monthly for each employee.

Mr. Smith should take a look at the CARD budgets for the past few years, available on their website.

https://www.chicorec.com/district-budget

He’d see that the agency gets more money from the county every year.

Revenues                  2018-19                                         2019-20         NOTES

RDA pass through   $1,090,000                                     $1,250,000       Redevelopment agency funding, $3 paid for every $1 borrowed

Tax income county   $3,045,000                                     $3,249,000      Property taxes and vehicles fees

Park impact fees            $85,000                                          $80,000     Developer impact funding, restricted to new facilities

Assessments                $136,746                                        $148,881      Fees collected from property owners in newer subdivisions

TOTAL TAX REV        $4,356,746                                 $4,727,881      Increase of $371,135 or about 8%

Program fees             $3,479,080                                       $3,804,255     Willmann says these are adjusted for inflation

Facility Rentals            $499,329                                         $550,988     Includes everything from ball fields to Park Pavilion

TOTAL CARD REV     $3,978,409                                 $4,355,243     Increase of $376,834 or about 9%

You can look at a few more past budgets at their website, you’ll see that revenues increase steadily as Chico grows and property values are high.  New development brings fees to cover new parks, and property values continue to rise in older neighborhoods. This should be sufficient to provide for Chico’s growing needs. But as you see below, the more revenues increase, the faster the salaries and benefits eat them up.  Even though they still have only 34 full time positions. 

Expenses                     2018-19                                        2019-20 

Salaries/Benefits      $5,700,093                                  $6,322,852    Increase of $622,759, or about 11%

Services/Supplies     $2,071,268                                  $2,266,348    Increase of $195,080, or about 9%

Contributions                $15,000                                            $15,000

Contingencies               $25,000                                            $25,000

Notes payable/leases     $1,005                                               $1,000

What I don’t see on the expenses list is a separate notation for the Pension Liability Trust allocations or payments made out of that special account. I wrote a note to General Manager Ann Willmann asking about that, I’ll get back with whatever answer I get. 

Another question I asked Willmann was whether or not the board approved her salary “adjustment” that was on the agenda for the August board meeting. 

Click to access August+15+2019+Agenda.pdf

General Manager Performance Evaluation and Possible Salary Adjustment
The Board of Directors will consider General Manager Ann Willmann’s performance over
the past year of her employment and any adjustment in salary or other amendment of
her employment contract deemed appropriate as a result thereof – Information/Possible
Action

I’ll get back to you with that.

The rest of Smith’s letter is not correct. 

“What bothers me is the inequality. Roughly half of Chico’s pre Camp Fire populations owns property, they would end up paying the recreation tax if approved. Yet the other half that don’t own property plus the displaced Paradisians that are qualified to vote, get to vote, on a  tax they won’t have to pay if passed.”

He’s wrong, even people who don’t own property will pay. This tax will show up on property tax bills, commercial and residential, and landlords will raise rents to cover it. For business owners it will be another expense to pass along to customers. 

The real inequality is that it is a flat parcel tax. No matter how large the property or how many units it has, the tag is the same. So the family living in the 1100 sf house on the eighth of an acre lot, renter or owner, will pay the same as the family living in the 2800 sf house on the half acre lot or the apartment complex down the street. 

The other point I gathered from looking at the CARD budget is that no parcel tax will ever suffice.

 

Dave Howell: Do they take us for fools?

29 Aug

I’ve seen some interesting letters to the Enterprise Record lately. A lady wrote the other day saying Chico streets are in such horrible condition she hates driving her car around Chico. I hear that – we just traded our son our F-150 for his tiny Chevy Cavalier. The F-150 sat higher off the ground, I could see the potholes but I didn’t feel them so keenly. The little Chevy feels like a Radio Flyer headed off Dead Man’s Hill, every crack in the road goes right through the seat covers, and sometimes there’s the sound of metal on asphalt as we hit a particularly bad hole. 

And of course, my 1956 Raleigh Superbe has seen her days, those skinny tires tooling along the park and neighborhood streets. I hit a pothole Downtown one day coming home from a meeting – ha ha, I was looking at another pothole instead of watching the street in front of my wheels – and CRASH! My bike basket flipped off the mounts and landed in the street. My feet slid off the pedals, which caught me right across the shins. And my bike seat stuck me one right in the small of my back. God I was so pissed off. 

There’s potholes on my street that look big enough to eat a stroller, complete with attached mom. But if you want to see something that looks like a third world country, head over to the neighborhood bordering the freeway off East Avenue, behind the old McDonalds and the abandoned For Kid’s Only Store. Check out the South Campus neighborhood, imagine out-of-town college parents seeing that for the first time.  

Sure everybody knows Chico streets are a mess – but do they know why? The city is going to tell everybody, in their campaign for a sales tax increase, that the streets are horrible because there aren’t enough revenues. But you know, if you go to meetings and listen to Constantin and Orme, they’ll admit that maintenance has been purposely deferred, while the city has been making, as CARD’s Ann Willmann likes to call them, “aggressive payments” on their pension deficit. 

So it’s good to hear from letter writer Dave Howell, who has it right – it’s the pensions. 

Howell asks, “will the people be fooled?” Well, he seems to be doing his best to prevent that. And thanks for the shout out Dave, I appreciate it.

Hats off to Juanita Sumner for shedding light on CARD’s tax increase measure. CARD has been considering a tax increase for years and has spent over $100,000 of our tax dollars on high priced consulting firms in an effort to get a tax increase measure on the ballot.  One consulting firm they paid openly brags about its ability to help get tax increases passed.  Yet CARD’s attorney claims these consulting firms are merely involved in informational surveys.  Only a fool would believe that.

The fact is that CARD, like the rest of local government, has made unsustainable compensation promises to its employees, especially regarding pensions. These promises are devouring money that should be going for infrastructure.  Like CARD, the City Council has used our tax dollars to hire a high priced consulting firm for a proposed tax increase.  The push for tax increases from our local government is all about unfunded liabilities that are unsustainable.

Without true reform we will face endless rounds of tax increases in a futile effort to fund unsustainable liabilities.  Scores of cities and counties raised taxes in the last several years and not one has solved their unfunded liabilities problem.  All passage of the latest round of proposed tax increases will do is kick the can down the road a couple of election cycles, but our local politicians and bureaucrats will never admit this.

Will the people be fooled?  We will find out next March when CARD’s tax increase will be on the ballot.

Dave Howell, Chico

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Good news over Yuba County Measure K suit?

28 Aug

Here’s some good news (I hope) from Connie about the lawsuit over Yuba County’s deceptive Measure K.  Plaintiffs charge that Yuba County officials campaigned to spend the money on public safety, which should have made it a “special tax,” requiring 2/3’s voter approval. But they put it on the ballot as a general measure, which barely  got simple majority approval. 

I’m no lawyer, but it sounds like the judge is somewhat in agreement with the plaintiffs. I’ll keep you posted.

We are sharing a post from Yuba Vision’s facebook site about the Measure K hearing yesterday. It gives a little more detail about the hearing.

Again, we are thankful that the Howard Jarvis Tax Association and Attorney Brian Hildreth have challenged Measure K.

Yuba Vision

“ARE ALL ESSENTIAL SERVICES ESSENTIAL?”

At yesterday’s court hearing about invalidating Measure K, Judge Steven Berrier opened with two “tentative thoughts”:

– Measure K is a special tax
– Materials (campaign) support public safety

And, with these two statements, most of the hearing saw the attorney representing Yuba County defending Measure K.

As a refresher, Measure K was on last November’s ballot. It was for a 1% sales tax increase in the unincorporated areas of Yuba County. It was placed on the ballot requiring a simple majority vote measure (50% + 1) for passage. The County campaigned it as a “special tax” revenue stream that would be used primarily for public safety, i.e., Sheriff, fire, DA, jail, etc. A special tax actually requires a 2/3 majority vote for passage. The Howard Jarvis Taxpayers Association filed suit against the County saying that Measure K was a special tax and it should have been on the ballot as such. They are seeking to invalidate it. The County has since back-peddled now saying Measure K was always meant for general fund purposes, meaning that it can be used for anything, from CalPERS payments to painting park benches.

It was a lively debate with very pointed questions made by Judge Berrier. There was one topic, the actual phrase from the measure, “and essential services,” that received the most attention. If you recall, this phrase was tacked on at the end of the Measure’s description, right after a listing of several public safety services. Judge Barrier challenged the County’s thinking about the phrase and asked a very revealing question, “Why didn’t the County use, “and general fund use,” at the end (of the Measure’s description)?” The County’s attorney had a hard time answering this question and argued that “essential services” is what infers the broader applications of Measure K. The Howard Jarvis attorney argued this phrase is what reigns it in focusing only on public safety services. The County attorney relied on dictionary definitions and felt the court should not focus on the phrase in isolation. Judge Barrier continued to ask more questions about the phrase, as well as the intentions of the pro-Measure K campaign materials.

The Judge’s primary question about the campaign to the County was, “The ‘campaign’ was exclusively about public safety…Should that be ignored?” The County’s attorney had a short response, “Yes.” Many in the audience softly shook their heads in disbelief.

The County’s attorney also employed a controversial circular argument saying that those who voted “no” on Measure K knew that it was a tax for general use, so therefore, Measure K was believed to be a general tax by everyone.

By the end of the hearing, it felt that Judge Barrier was leaning in favor of invalidating Measure K, but his written ruling will be his final decision. There was also strong indication by the Judge that the entire case will end up in appeal, no matter his ruling….More time and money, folks. Meanwhile, Measure K sales taxes continue to be collected and put into a holding account until this entire legal mess is resolved.

Keep Yuba County Honest and Transparent

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Stone/Ory recall – I want to support this but have some questions

27 Aug

I’ve been trying to watch the effort to recall Chico City Council members Karl Ory and Randall Stone.  According to Melissa Daugherty at the News and Review, recall organizers have 160 days from the date the petition was approved by the city clerk – until November 18, 2019 – to collect signatures of at least 7,592 registered Chico voters.  They will want at least a couple thousand more to be on the safe side, since the clerk is allowed to throw out a petition if she finds a certain percentage of the signatures to be invalid. 

As far as I’ve been able to gather, that would put the recall on a ballot sometime in Spring 2020, which is confusing, because both Stone and Ory’s terms are up in 2020, and they’ll be up for re-election. I’m not sure if the recall election will be called before or after the general election, and how it would all work. 

Here’s the group’s Facebook:

https://www.facebook.com/recallstoneandory/

I have not signed the petition because I have questions.

  • Who is financing this recall? I looked at the city clerk’s website but did not find any campaign contribution documents for this group. I don’t frankly know if they are required to file finance documents with the clerk unless the recall comes to a ballot. 
  • What will happen if the recall is successful? Will we have to have another special election? Who will run? 

I don’t subscribe to Facebook, and don’t know who exactly to contact, so hope somebody  from the recall effort will come back to me with some answers. 

 

 

 

Defined benefit plans must be fair to taxpayers, they must be financially sustainable, and the participants must pay their fair share.

26 Aug

CARD has another “informational” jam session this Wednesday evening, 7pm, at the CARD center on Vallombrosa.   I will be out of town, but hope others will attend. I must say, those meetings have been informational.

So, I wrote a letter to the editor about it!

I learned a lot attending two of Chico Area Recreation District’s parcel tax informational meetings.

I knew the pension cost is divided between employer share and employee share. But, I didn’t know,  for years CARD paid not only the employer share, but the entire employee share.  General Manager Ann Willmann said the agency now only pays 14% of their total CalPERS costs, resulting in a $2,800,000 pension deficit.

I misunderstood the Public Employees Pension Reform Act, thinking employees would pay 50% of their actual pension cost. Instead, they are only asked to pay 50% of CARD’s total payment of 14%. CARD employees agreed to pay an additional 1% of the employer cost, making their total contribution an unsustainable 8%.

Willmann also mentioned “aggressive payments” made toward the pension deficit itself. Whenever there is a downturn in the stock market, CalPERS demands more of it’s members, and the taxpayers are expected to pick up the tab. CARD created a “Pension Stabilization Trust”. Willmann admitted that maintenance to facilities like bathrooms has been deferred while the agency diverted funding to the pension trust.

Instead of new taxes, we need true pension reform.  Starting in 1999, CalPERS and powerful union lobbyists  pushed through unrealistic and unsustainable salaries and benefits for agencies all over California. These agencies have funded their pensions by cutting services and deferring maintenance – putting their pensions ahead of their mission to serve the public. Defined benefit plans must be fair to taxpayers, they must be financially sustainable, and the participants must pay their fair share.

 

Pension Tsunami Part 2: The lies, the lies, the lies – district manager claims CARD “debt-free”, meeting attendee reminds her of the pension liability

17 Aug

As I  was sitting at CARD’s “informational meeting” last Tuesday (8/13), I wanted to argue with the things Ann Willmann was saying, but I am always afraid to speak up at those meetings. I’ve been  attending CARD and city of Chico meetings for years, and I’ve found if you are not careful with these people they will just shut you out. Former CARD director Steve Visconti repeatedly ignored my requests to be placed on the Aquatics Facility Feasibility Advisory Committee (AFFAC) , and when I asked to be noticed of the meetings he simply told me there weren’t any. I’d  find out about them after-the-fact when there would be an item in the board agenda. So, yeah, these people intimidate me sometimes, that’s a fact.

But somebody really needed to ask more questions, the crowd of less than 20 observers was silent as she continued to spin her web.  At one uncomfortable point, Willmann talked about CARD being debt-free. There are so many things wrong with that statement, I just sat there in shock. The first thing I thought was, “Yeah, you paid off the loan on Lakeside Pavillion with money you should have been using to maintain other, more appropriate facilities.”   The district bought Lakeside Pavillion, sagging with rot and needing a  new roof, for over $1,000,000, with over $100,000 in interest.  Then there was at least $100,000 in repairs.  So, Willmann was trying to say, that instead of being stupid for buying an old crapper that has no recreation facilities, CARD was being smart for using money that should have  been going to serve the public to pay off a bad loan before it got worse.

That’s the same BS they are using to explain their many recent large payments to CalPERS.

As I sat there scribbling notes and grinding my teeth, the guy next to me raised his hand and corrected Willmann.  He corrected her, saying, “but you’re not debt-free,” asking, “Is it not disingenuous not to mention the unfunded pension liability?” He recalled it was over $2,000,000, and then Willmann corrected him –  $2.8 million.  And I could tell she was uncomfortable with the question, very flustered.

She said, “We are working toward aggressive payment to save interest…” 

I’ll say they’ve been damned aggressive, as Willmann admitted earlier in the meeting, deferring maintenance on district facilities while making “side-fund pay-offs” on the pension deficit. “Side-fund pay-off” means, payments in addition to the “employer’s share” of current employee benefits – in the hundreds of thousands a year. Last year they established a “Pension Stabilization Trust” like the one the city made up, into which they siphoned more than $1,000,000, funding taken from payroll, for additional “side-fund pay-offs”.

I was happy that the man next to me did not let up. He asked pointedly, “what about pension reform?” He reminded everyone that most private sector workers don’t  get pensions, that they’re lucky to get a 401K.  And he opined that no matter how much money the taxpayers kick into this scheme, the deficit will not get paid down until there is true reform. “The can is just getting kicked down the road…” he said.

Willmann was visibly side-blinded by his comments. Her lips were taut when she glared at him and asked, “What would you suggest?”

He didn’t miss a beat – “either get rid of pensions altogether or make the employees pay more.” He suggested 401K’s into which the employer puts a “defined contribution,” meaning, we agree to one contribution and no CalPERS to raise it any time they make a bad investment. What we have now, a system that was never vetted before the taxpayers or voters, is “defined benefits,” meaning we continue to pay as much as CalPERS demands, based on their die-hard scheme to make the difference off a volatile stock market using really, really bad judgement.

As I expected, an exasperated Willmann barked back, “we can’t get out of CalPERS, buyout is nearly impossible…” Which is a plain lie, other agencies have done it. For perspective, CARD only owes $2.8 million, the city of Chico owes almost $150,000,000.

Willmann, her voice cracking,  revealed that she’s only recently started paying 8%. That’s right. Up until a couple of years ago, she claimed, “prior management paid nothing…” Sure, she’s right, but what she didn’t mention is that she was a member, a “classic” member, of prior management, and also paid NOTHING. A couple of years ago, CalPERS demanded “classic members” start paying, at 2%, inching their way up to 8% just this 2019/20 budget cycle.

Still sounding like she was going to bust out in tears, Willman went on to say she’d been to CalPERS, “asking them for reforms… we chose to save taxpayers’ money by paying it off as fast as we can…” 

Staying with CalPERS and continuing to allow employees like Willmann to pay less than 10% will only drag us deeper into debt. CARD’s debt has increased by over $1,000,000 since 2015. And I imagine you’ve heard about this week’s stock market downturn?

Again, the man next to me took up the offensive. “The city is  falling apart because the money is being transferred from infrastructure to pensions.” At this point Willmann  was ready to bargain, trying to shut this guy up. “So, you want the measure to say no money goes to pensions?”

To which I would respond, the parcel tax money would just free up the rest of the budget to make the side-fund pay-offs. Duh Lady. But my neighbor went back to “more meaningful pension reform, tax increases won’t solve it…”   

Looking desperately around, Willmann asked if anybody else had a question. Silence. So my neighbor took up the conversation again, reminding Willmann that the city was undergoing a building boom right now, and that would be generating a lot more revenue. This, as Willmann had pointed out, would include builder’s impact fees, which are only allowed to new facilities. That would make sense, developers should pay for facilities necessitated by new construction. And then the new housing  generates  more property tax  revenues, which mean more money for infrastructure upgrades and maintenance. But Willman still insists CARD needs a 30 year parcel tax, just to maintain infrastructure?

Suddenly a tiny, nasal voice came up from the back of the room – CARD board member and former city councilman Mike McGinnis. McGinnis was on the defensive. “We need to be aggressive in paying the pensions deficit…we didn’t create the pension system…” He then said, “more and more people are moving to Chico…we need to provide more recreation…”

First of all, the mission of the district is RECREATION, not PROVIDING A SALARY/PENSIONS TROUGH for a bunch of bureaucrats that don’t have anything to do with providing recreation. Second, all that NEW HOUSING COMES WITH IMPACT FEES AND CREATES NEW, HIGHER PROPERTY TAX REVENUES. In fact, those new houses won’t only be more expensive, they will raise the property value of houses directly around them.

This is the kind of “leadership” the CARD board provides. In fact, as city councilman, Mike McGinnis participated in many of the decisions that drove Chico into bankruptcy, including approval of ever-increasing salaries and benefits for city management. 

So, do you really think you want to entrust more tax money to an agency that seems to believe the taxpayers are just another herd of cash cows to bail out their pension fund?  

 

 

 

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CARD propaganda blitz amounts to a lot of false claims

15 Aug

Chico Area Recreation District is hosting a series of informational meetings about their tax proposal over the next month. The first meeting was held this past Tuesday evening. It was short and very informative, I hope more people will take 45 minutes or an hour to attend one or more of these meetings.  It’s a perfect opportunity to ask questions. All meetings are scheduled at the CARD Center on Vallombrosa.

  • August 21, noon
  • August 28, 7pm
  • September 5, noon
  • September 10, 8am

Tuesday’s meeting started at 6 pm and was over shortly before 7pm.   CARD manager Ann Willmann gave a power point presentation. It was a good look at the coming propaganda blitz CARD is about to unleash.

Willmann shared some interesting general information.

• Created in 1948 (71 years ago)
• Encompasses over 250 square miles, beyond City of Chico city limits
• Population served is 121,000
• Operated separately from the City of Chico
• Oversight by an elected 5-member board of directors

I didn’t know those first three things, so here already I learned something by going to a public meeting. But it didn’t take long for Willmann to get into the full-on pitch.

What CARD Does  –  Provide parks & recreation facilities. Enrich our residents’ quality of life. Promote health, wellness, learning and fun. CARD is one of the most utilized agencies in our area,with our parks, facilities, and programs serving thousands of people annually.”

Beyond, “provide parks & recreation facilities,” none of that can be proven. Frankly, I’d liked to have seen a number besides “thousands” of people served annually. “one of the most utililized agencies in our area…” Well, prove it. There are no attendance numbers in the budget reports either. Are they including agencies like law enforcement and public safety, the road department?

I think a common misconception about CARD is that they are responsible for all the parks in town, not true. The city owns all of Bidwell Park. CARD leases the Nature Center from the city, and is responsible for maintenance on that specific property. I don’t know whether they own or lease the ball fields under the same type of agreement. But, I found the following claims to be a stretch.

Our parks:
Reflect the quality of our community.  Oh, that’s not good. Many of our parks are in pretty disgusting condition.

Improve property values.  I think this is highly disputable. When you look at real estate listings, parks and other public attractions like schools and churches are considered problematic. Especially when security and lighting are lacking, as has been one of the main complaints about CARD  facilities. Another complaint has been lack of upkeep, which damages curb appeal for any home.

Contribute to education.   I do notice,  since they took over the Nature Center, “day camps” have been their biggest source of income.

Reduce crime.   That’s funny – Terry Cleland said transients were stealing out of the dugout at ball games. CARD will have to keep working on this one.

Attract businesses and create jobs  Attracts businesses? CARD uses tax dollars to subsidize programs that drive local businesses out of the market. For example, Off the Wall Soccer, a longtime popular indoor sports facility, went out of business last year after CARD renegged on a promise not to compete with OTW’s special 7 man teams. CARD already had an outdoor program, why move in on a local business? Because they can undercut anybody with the guarantee of tax dollars. CARD is a very big competitor for private daycare facilities, and even the local wedding industry.

Creates jobs? CARD provides poverty positions, in fact, most of their workers earn less than $30,000/year, get no benefits, and rely on AFDC and Medi-Cal to fill in the gaps. A few years ago, they cut their part-time workers to 28 hours or less to get out of paying Obamacare.

Willmann shared the results of CARD’s recent survey, here are the “priorities” listed by respondents:

• Reducing crime and homelessness in parks by
providing security guards to patrol parks
• Providing clean, safe parks and recreational
programs for all Chico area residents
• Upgrading parks with lighting, security,
parking, and other safety features
• Improving and maintaining park bathrooms

• Repairing/updating aging recreation centers,
playgrounds, sports fields, swimming pools,
and facilities that promote active and healthy
living and maintain recreational programs for
seniors and youth
• Ensuring accessibility of parks and recreation
for persons with disabilities
• Renovating/expanding parks, trails, and
recreation areas, and completing parks under
construction

Here Willmann went on the defensive, listing “challenges”

• Aging Facilities + Reduced Funding =
Deferred Maintenance
• Continue to address safety needs
• Upgrades needed to aging parks and
facilities
• Create and maintain health-related
programs for all-youth to our seniors
• Discussions and studies have been
conducted
• Financial impacts out of our control
• Fees collected are not enough

Aging facilities? Willmann said most of our  facilities are over 35 years old, that’s not true.  DeGarmo Park, Humboldt Skateboard Park, the Disc Golf Course at 5 Mile, Oak Way Park – these are just some of the facilities that have been built recently. Wildwood Park is only about 25 years old. Reduced funding? Look at the budgets, available here, and tell me they haven’t been getting more money every year:

https://www.chicorec.com/district-budget

What’s true there is “deferred maintenance.” They’ve allowed facilities that should have been easy to keep in good working condition while they’ve paid more and more into their pension deficit, raised management salaries, and  taken on costly new liabilities like the rotten and aging Lakeside Pavillion and Nature Center. One of the top complaints listed in the survey was dirty bathrooms. But look at the budget, do some serious reading – they pay more for pensions every year, with employees only now being asked to contribute anything, and it’s still less than 10%. 

I was really shocked when she listed the Camp Fire as a challenge. 

“Reduced property tax base for the County means a reduction in property taxes for all public agencies. In 2019, CARD lost over $200,000 in revenue”

This was reported immediately after the Camp Fire, by city of Chico mismanager Mark Orme. But, as Orme reported, the state immediately announced they would “backfill” these lost revenues up to three years after the anniversary of the fire. So, CARD didn’t really lose $200,000 as Willmann tried to claim Tuesday night. Private homes within the Camp Fire burn area are already being rebuilt, some of them beyond their original footprint, which means they will be assessed for more within three years than they were assessed before the fire. 

Willman also claims that “Future tax reductions are expected, and plans are being made to adjust expenses.” What future tax reductions?  I’m calling bullshit on this one. There is currently a building boom going on in Chico, with more houses approved for the immediate future. That means more, more, more property taxes to maintain and upgrade current facilities,, not to mention, developer impact fees that pay for new parks. 

And finally she claims “We have seen an increase in participation in already impacted programs due to the increase in our local population.”

Oh, not this one again. Look around you  folks – the college students are back in town, families are getting  ready for school to start, but have you been held up  in any of the hellish traffic  jams that occurred in the weeks following the fire? Have you waited more than 5 minutes at a grocery store check-out? No.

When a woman asked from the back of the room if Willmann had any statistics to back up this claim, Willmann quickly answered, “No.” Furthermore, “we just noticed this increase…” 

I’ll have to stop here, I’ll pick up the rest of the meeting tomorrow. Things got kinda hot when the guy next to me brought up the pension liability. 

 

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