Wednesday, March 19, 2014

A Tale of Two Cities

Encinitas and Berkeley, like many California cities, have a serious problem with escalating pension costs due to years of financial mismanagement at both the cities and CalPERS.

Recently, we saw how Encinitas city management communicated internally and to the public about the pension crisis. That is, with false reassurances:
"the city has already included a 10% annual increase in the current six year financial plan beginning in FY 2015/16."
In contrast, see how Berkeley officials discuss the same circumstances in their city:
“This is a pretty grim projection for the future,” said Mayor Tom Bates. “The assumption (on the rate increases) is there are no salary increases and no new employees. It’s difficult to imagine there won’t be an increase over that time. We’re headed for some really difficult decisions down the road, there’s no doubt about it.”

“Those numbers are shocking enough without seeing them going up,” said Capitelli. “People are retiring at an earlier age and living longer.”

Finance director Hicks said the primary driver for the rate increases is Calpers’ investment returns (see table above). In the year to June 30, 2013, its investments gained 13.2%, 5.7% higher than the assumed 7.5%. But that excellent year, and the likelihood of another bumper year to this June 30, does not make up for the severe losses in 2008, 2009 and 2012.

“This is not just a Berkeley problem, this is a major problem for the state of California,” Bates said. “The state needs to step into this. It’s going to hemorrhage all over the state. We’re putting ourselves in the position where there’s going to be a major hit on the economy.”

Which kind of city management do you want: the kind who will tell you comforting lies or the kind who will tell you the difficult truth?

21 comments:

  1. Truth. Unless you are in Encinitas where any version of pension fantasy seems to get swallowed.

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  2. Yup, that's why I think you have to candidates at this point who come from a place where they're willing to take on pensions. Of the current crew, I think Tony might, there's still a chance Lisa would come around, although doubtful. Anyone else isn't going to act on the pensions, for obvious reasons in Mark Muir's case.

    -Mr Green Jeans

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    1. Shaffer take on pensions??? That's laughable. She and her current husband collect 4 govt pensions between them. She'll be the first to vote to increase taxes on everyone. Fuck her....

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    2. Name their pensions.

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    3. Through a CPRA request, I asked both Lisa Shaffer and Teresa Barth to share all of the household pension monies they receive from any government sources. I was ignored by both. The Clerk informed me I would have to go to the State or the Federal government and submit by requests to them. I'm not sure if Federal pensions have to be disclosed through California Public Records Act requests?

      But I have also heard that between her husband and herself, Lisa Shaffer gets four pensions, or maybe it's only three at this time? After being a Council Member or Mayor for a total of five years, then our City elected officials are eligible to receive additional pensions, through CalPers, I presume? These pensions are comparatively modest, as are their monthly compensation amounts, especially when compared to non-elected public officers.

      My understanding is that Teresa Barth receives a pension through the State Agricultural Board, which manages the Del Mar Fair? This is all unsubstantiated, as I said, because neither Barth nor Shaffer would answer my requests for information, which I copied to them, personally.

      The Mayor also gets an extra spending allowance and all Council Members, including the mayor, get substantial monthly car allowances, I believe set at $350 each? That seems excessive, since they are all residents of Encinitas! Why should taxpayers pay for their cars and gas mileage for non city related business?

      The Mayor gets an additional spending allowance for ceremonial duties, which has amounted to approximately $800 per month. The City also funds junkets, including air fare to New Orleans, last year, for Mayor Barth, to hob nob with her Mainstreet Association best buds, and, presumably, for Tony Kranz' recent trip to Washington DC? Again, I do not know the dollar value of these reimbursements, aka perks, but they are in addition to salaries.

      By reviewing the Brown Act, I recently discovered that with respect to Board Meetings or Committee Meetings outside of the City, itself, such as SANDAG or SDWD, only a total of $150 per month per commission or committee can be paid to any Council Member in attendance, as a stipend.

      So if there is a special meeting in addition to the regularly scheduled monthly meeting of SDWD, for example, then an "independent stipend of $100" could not be paid to the Board of Directors, which is comprised of Council, for both meetings.

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    4. And you wonder why they don't like you? Wow.

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    5. If you are speaking to me, 9:05, I don't wonder why.

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  3. I doubt we will ever hear the real truth on this issue.

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  4. I think you're perhaps overestimating the similarities between the two cities.

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  5. Overstating would be a more accurate term.

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  6. Proactive enforcement is only to harass citizens and get revenue for pensions. This is the worst thing to ever happen to Encinitas, fascism in the making!

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  7. Only Malibu and a few cities in California use "proactive" enforcement. It means you can be cited and fined for every little thing. This goes against the spirit of our relaxed beach town history. Proactive enforcement will be used to line the coffers and that is it. Your freedom has just eroded further.

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  8. If you hire a code enforcement clown, eliminate another City position of greater pay. The priority goal for the City is to REDUCE the huge Employee costs killing our City.

    This City Manager doesn't get it. He never had a job outside government. Its time to remove Vina. Common City Council, every day he remains, you all lose credibility.

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  9. 9:10 You nailed it. Vina = zero credibility for council.

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  10. Does the council think they aren't obvious by acting like a code officer will help the bar situation when they actually wanted this for an entirely different reason? Has nothing to do with curtailing drunks, this is just spin. Too bad the downtown residents were just played this way. It is all so obvious, Muir looks so nervous, his conscience might have activated.

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    1. Not possible.

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    2. Yes, another full time code enforcement officer was before requested on the Consent Calendar, to deal with Code Enforcement's backlog of open cases. However there was no explanation for why there is a backlog, only an invalid assumption that the backlog exists because the City needs to hire another full time code enforcement officer.

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  11. can the new code officer fix my road?

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  12. Nope. Won't bang your pot either.

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  13. Vina and City Council take yet one more step in the wrong direction. Pathetic.

    I am for sure voting in new blood next election. I will support Council members that will focus on the real issues at City Hall which is lowering Employee Costs including significant reductions in costs for our pension program.

    All this Council is focuses on is feel good meetings and getting along. None are real leaders. A real leader would focus on priority.

    Same question still exists, How does our next five years financial projection look when including all the new fire stations, huge DEBT we need to pay back, Pension DEBT, Deferrred road maintenance, and our foreseeable project needs?

    Vina? Any answer?

    Nope… we all know your plan is to string out this strategic planning crap as long as you can, and when City Council finally wakes up and passes a resolutions directing you to do a long range financial plan for the city, you will announce your retirement.

    Well played Vina, you will! Encinitas Citizens lose!!!!! and this current City Council goes down in history as the feel good City Council that ignored all the City's top priorities for 4 years and made conditions that much worse be EXPANDING employee costs adding 5 new Full Time Employees instead of shrinking City Hall costs. I have to say, you all should be ashamed to let down the City like this….

    I know quick, deflect- Start talking about Pacific View or bar problems…. lets ignore the big problems that cause some real discomfort. we get it….. sigh :(

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