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Fleecing taxpayers costs Ventura money

A Little Here. A Little There. Pretty Soon It Adds Up To Real Money.

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For and Against the Parcel Tax

Bellwether: “A male sheep which leads the flock, with a bell on its neck. A leader of a thoughtless crowd” —Webster’s New Collegiate Dictionary

THE  SOUND OF THE BELL

[SHEARING TIME?]

Three years ago nobody in city government would pay attention to the voices of caution who warned the City Council about the money excessive public employee salaries cost and the unfunded pensions of public employees. Now, thanks to the City of Bell perhaps the citizens of this community will pay attention to their role in government, and the need for serious and drastic reform.

Everything went wrong in Bell.  It was greed in all of its glory, and it illustrated what is wrong with the arcane public pension system in this State, and in every city in this state, including Ventura.    Bell City Manager, Robert Rizzo, resigned after it was revealed he was being paid $800,000 to oversee a town with a population of 40,000.  Now the LA Times reports that the records actually show that he was paid $1,500,000 a year.  Included in that was 28 weeks of vacation and sick time at a cost of $386,000.  Well he is gone but he is not out because he will collect $600,000 yearly from his pension benefits with CALPERS.

fleecing taxpayers costs Ventura money

Ventura taxpayers get fleeced in Bell disaster. We will pay money to Randy Adams for life.

This example however is even closer to home.  Two people in the City of Bell used to work for the City of Ventura.  Angela Spaccia, Assistant City Manger for Bell was paid  $376,000 a year before she quit, and moved over to work for the City of Maywood.   She used to work for the City of Ventura. Then there is Officer Randy Adams who worked in Ventura for 23 years as a police officer.  He then gravitated through various jobs until he became the Chief of Police for the City of Bell.  He too resigned after it was revealed that he was earning $457,000 a year.  He can retire, as will Ms. Spaccia eventually, but whose money pays the pension?

Not the City of Bell.  They escape nearly all the costs of Chief Adams $411,300-a-year pension. Under CALPERS rules, the city is responsible for just 3% of that because he only worked there for one year. Taxpayers in Glendale, Simi Valley and Ventura would have to pick up the tab.

This happened because Bell hired Adams at more than double the money he was making as Chief in the City Glendale. That salary spike doubled his eligible pension amount under CALPERS, the state’s public employee retirement plan.  Add the state’s permissive pension laws and a host of variables that can dramatically affect retirement pay and we find a system that leaves you in a bleary daze

Other cities will be on the hook for Adams’ pensions costs even though their salaries were relatively modest. until he landed in Bell. When he resigned Chief Adams was making $457,000.  He will now get  approximately 90% of that sum.  Glendale will have to pay around 16% of Simi Valley 18%, and Ventura 63%. Ventura alone will have to pay this guy $259,119 per year for life. Remember, none of this has ever been funded.

CITY OF VENTURA’S RESPONSE

Ventura’s mayor, Bill Fulton, has written several articles on the subject.  You can go view the articles here.  He, like everybody else, condemns the excesses by employees and officials in the City of Bell.  His articles are well written and deserve a read, but how transparent is our city government?  Mayor Fulton answered this question in one article:

“…democracy only works, even in small cities, if people pay attention, and oftentimes people aren’t paying attention. But one of the most disturbing aspects of the Bell situation … is how hard it is to figure out what’s happening even if you are paying attention. In spite of the state’s vaunted Brown Act open-meetings law, California governments are still not particularly transparent”. 

HOW MUCH MONEY DOES THE COUNCIL MAKE?

The City Charter limits council members to $600 per month and the mayor to $700 per month, plus members are paid for participating on certain boards and commissions.  Here is the yearly total:

Councilmember Salary Boards Travel
Fulton, Mayor $ 8,800 $2,000 $1,200
Monahan $7,200 $3,800 $1,200
Tracy $7,200 $0 $1,200
Morehouse $7,200 $1,440 $1,200
Weir  $7,200 $0  $1,200
Brennan $7,200 $0 $1,200
Andrews $7,200 $0 $1,200

 

CITY EMPLOYEE COMPENSATION

Employee Salary Medical Pension Contribution Car
Ken Corney, Police Chief $195,153
Quinn Fenwick, Asst. Police Chief $160,012
Kevin Rennie, Fire Chief $187,000
Don McPherson, Asst. Fire Chief $170,014
Ron Calkins, Public Works Director $175,547
Jay Panzica, Chief Financial Officer $171,265
Rick Cole, City Manager $174,158
Mary Walsh, Asst. City Manager $171,265
Ariel Colonne, City Attorney $194,909
Jeff Lambert, Community Dev. Dir. $171,265
Elena Brokaw, Director, Parks & Rec. $167,088
Jenny Romey, Human Resources Dir. $159,037
Total $2,096,713

*In response to a VREG request for the full cost of each of these employees the City Manager, on August 10, 2010, provided the following response:

“Within the next few days, we (will) have calculations on the cost  of employees over and above regular salary (we’ve just posted those earning over $100,000 including gross pay and overtime) to be followed by the Box 5 W2 calculations (which also includes city paid deferred comp and the value of life insurance) to be followed by a total all-in of that plus city paid benefits and CalPERS contributions”—Rick Cole, City Manager

Editor’s note:

For detailed information on past or present Ventura city employees’ salaries, visit transparentCalifornia.com.

As for Ventura’s exposure to the Randy Adams pension claims, purportedly the City has sent a letter of protest and/or legal challenge to CalPERS to try and stop payment.  Good luck with that one!  Even Chief Adams will lawyer-up and argue we are a nation of laws and not men.

Editors’ Comments:

How many more Randy Adams types do we have out there? How much more  do we owe, over the amount funded through CalPERS, to those who are retired or about to retire in the future?  It is time for government to become proactive instead of reactive in the management of our tax money and find out before we end up in the shearing shed. Stop listening to the bellwether !

Editors:

B. Alviani           S. Doll

J. Tingstrom     K. Corse

B. McCord          T. Cook

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living dead because Ventura has no money

The Ghost of No Money Haunts Pensions and Cemetery Park

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‘Take some more tea,” the March Hare said to Alice, very earnestly. I’ve had nothing yet, “Alice replied in an offended tone: “so I can’t take more.” “You mean you can’t take less, “ said the Hatter: “it’s very easy to take more than nothing” —Lewis Carroll, Alice’s Adventures in Wonderland.

THE SPECTRE OF BANKRUPTCY

[T.E.A. PARTY ANYONE?]

In the August 2008 edition of this newsletter, we suggested that Ventura “may” be following the missteps of the City of Vallejo right into bankruptcy court. After you read this you will realize that our unfunded pension debt and contractual obligations are staggering.  We as a community owe $150,000,000 alone on the City’s pension debt, which is $1,500 per person in a community of 100,000.  Incredulous?   We’ll explain.

no money in the CAFR

The 2008 CAFR shows Ventura has no money to pay unfunded liabilities.

Start with the Comprehensive Annual Financial Report (CAFR), ending June 30, 2008.

Remember, the pension statistics are based on numbers as they existed on June 30, 2007, These CAFR reports are published 18 months after the fact. At page 15 it reflects that our long term debt, labeled “total non current liabilities” totals $135 million dollars ($134,984,820).

You might recall that the City financial types reported to the Blue Ribbon Tax Committee that we have $10,000,000 in our general operating fund — that’s our reserve, which has not changed since 1992.  All investment  income from that reserve was spent. They also reported that we have $145,000,000 in other investments (after marking down the $10,000,000 lost to WAMU and Lehman Bros. investments), but we can’t touch this money because the funds are committed due to previous contractual commitments of the City Council.  So we owe $135,000,000 and have $155,000,000 in investments, ignoring the contractual obligations for the moment. On the face of it we have $20 million more in assets than debts, so we are looking good right?

Wrong!

Let us take a closer look at the City of Ventura’s Pension Plan. Turn to page 70 of the CAFR (page 102 of the PDF file) of the City’s 6-30-08 Comprehensive Annual Financial Report, which lists the “off the income statement” underfunded obligations — money we owe as of June 30, 2007, for which we have no money.  The total Actuarial Asset value for the City pension plan investments is stated as being $313,847,955, the actuarial accrued liability is $362,521,549.   The  unfunded accrued liability for regular employees is $5,176,721 and for Safety Employees (Police and Fire)  is $43,496,873, or a total of  $48,673,594.

This liability ($48.7 million) accrues interest at the rate of 7.75% per year on the amount that is owed as an “unfunded liability”. Remember again this was 18 months ago. Then move to the end of 2008 and add to this the fact that CALPERS devalued our actuarial asset value by 35%.  The result is that the actuarial asset value went down by $109,846,784 ( $110,000,000), thereby increasing our liability by the same amount thereby reducing the value of our pension assets to $204,001,171. —we lost the  money in the market. The following is the real financial picture right now:

True Financial Picture
(1)  June 20, 2007 unfunded debt $48,673,594
(2)  Interest 6-30-07 to 12-31-07 @7.5% $ 1,825,259
(3)  Interest 1-1-08 to 12-31-08 @7.5% $ 3,650,519
(4)  Loss of pension value 35% $110,000,000
Total Unfunded Liability of City $164,149,372*

Now go back and add in what IS shown on the Comprehensive Annual Financial Report(CAFR) for 2007 (page 15 of the document, page 33 of the PDF). This is what is owed by the Citizens of this community — right now, and getting worse each year!

(1) Long Term “noncurrent” Debt $135,000,000
(2) Unfunded pension benefits $ 164,149, 372
Total debt $294,673,595

How would you view our current financial posture?  We owe $294,673,595 and we have $10,000,000 in the bank.  Any suggestions for our City Manger or City Council?

Consider that the City of Vallejo decided to file bankruptcy when their obligations amounted to $730 per person. To further add to your perspective, Orange County, California filed the largest municipal bankruptcy in the history of the U.S. at a cost of  $600 per resident.  Ventura’s obligation is approximately $1,500 per person.

If you were in charge, what would you do?

THE CEMETERY PARK PROPOSAL

no money for Cemetery Park

Cemetery Park will remain a ghost town because Ventura has no money for a Memorial.

[FINDING THE MONEY IS A DEAD ISSUE]

The City has spent $40,000 for the architectural renditions of  a plan to create a memorial place at Cemetery Park..  This $4,000,000 Plan includes a memorial to commemorate those buried at the cemetery, memorial gardens, refurbished landscaping, veterans’ memorial walk and flagpole, and repairs to the historic WPA rock wall, 3,000 bronze grave site markers, and the retrieval and display of existing headstones. The City acknowledges there is no money, but assures the proponents that over time, with a combination of city funds and outside grants, perhaps they can find the $4,000,000 million dollars.

Then there are the opponents. One group, the restoration folks, want the park restored as a cemetery, and claim the City plan does not go far enough.   They want it like it was headstones and all.  Another group contends that the decision to make this into a park was made forty years ago when the City  was forced to do something because those responsible did not maintain the cemetery. The park has been serving the community as a passive park and a memorial since and is used daily by local residents. This is a 7-acre park serving the mid-town community.

As an interesting aside  the City code enforcement folks have stepped up a campaign to issue expensive citations to owners of dogs that are not on a leash in Cemetery Park.

Editors’ observation:

Perhaps the question we all should be asking instead is why our City Council  is so willing to spend $40,000 to placate a vocal minority by voting to pay for a study to formulate a plan to restore an old cemetery site when we have so many other pressing priorities.  How about – No!

THIS FROM A READER

We receive many emails from our readers which have been very positive. This concerning our March issue:

“Thank you so much for this current issue. One of the many things I  like about your report is that it stays on course and is not distracted by all the non-issues brought up by the City for dodging the bullet. The concept of public employee’s being exempt from the reality’s of this economy really, is the height of arrogance”.

—R.M.

EDITORS’ COMMENTS

 Until the Citizens of this community solve the systemic problem, by electing city leaders who are “qualified” to manage a municipal corporation, with a operating budge approaching $500,000,000, and in electing leaders who will make the hard (not political) decisions to solve the pension and unfunded debt issue, the taxpayers and citizens of this community will always be at risk and a target for more taxes and more fees.

 

Editors:

B. Alviani        S. Doll           J. Tingstrom

K. Corse          R. McCord    T. Cook

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