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Testing America's new civility in Pleasanton

Original post made on Jan 30, 2011

Politicians of all stripes joined with President Obama on Tuesday night in seeking civility in debating and enacting key legislation affecting America. Next Tuesday night, as the Pleasanton City Council holds a public workshop on the city's unfunded pension liabilities and, specifically, on a proposed contract with city employees, that spirit of civility will be put to the test locally.

Read the full story here Web Link posted Friday, January 28, 2011, 12:00 AM

Comments (21)

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Posted by John Q Public
a resident of Downtown
on Jan 30, 2011 at 4:48 pm

Where exactly does the show of force and intimidation staged by union members at the last council meeting come into play when talking about civility? The room packed shoulder to shoulder with Pleasanton's police department and other city employees sends a message of intimidation intended to limit the public from speaking.


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Posted by Bart Hughes
a resident of Another Pleasanton neighborhood
on Jan 30, 2011 at 6:05 pm

Let's continue to stay focused on the issues and associated facts. Hopefully, there will be many from both sides of the topic at the meeting on Tuesday so we can have the robust Q&A/discussion on the topic that this community needs.

As many have seen on these blogs, I continue recognize the value that employees provide to this city. They are a respected and needed component to our great town. But this doesn't mean I'm going to ignore a financial issue that continues to put financial stress on our finances.

Please keep in mind that the meeting starts at 6:30pm Tuesday night and not the regular time of 7pm. I look forward to the workshop.


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Posted by George Washington
a resident of Pleasanton Middle School
on Jan 30, 2011 at 6:12 pm

There's John Q. Public (translated: curmudgeonly old coot), in the spirit of the first amendment, recommending that cops and other city employees not be allowed to attend council meetings.

On what grounds? They aren't part of the public. Only John Q. Public is part of the public. It even says so in his name. If, however, you're a cop or city employee, you don't count as part of the public. No, you're an intimidator. John Q. Public says so.

Face the facts, critics of public employees, as John Q. Public so demonstrably illustrates, are nothing more than simpletons who have been instructed by Tea Party leaders where to direct their hatred.


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Posted by Give me a break
a resident of Another Pleasanton neighborhood
on Jan 30, 2011 at 6:14 pm

When you are asking the public employees of this town to lose significant amounts of income, I'm wondering why it's not appropriate for them to be there? You should look them in the eye when you demand this reduction in pay that may cost many of them more hardship than you will even know. You don't like what the economy has done to you, you want public sector to share in the pain, then you face them with your statements. Intimidation is what you do here daily, now try not being such a coward to those who are interested to hear your outrage in person.


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Posted by Stacey
a resident of Amberwood/Wood Meadows
on Jan 30, 2011 at 8:53 pm

Stacey is a registered user.

Web Link

A must-read for everyone trying to understand pension underfunding. It talks about the misuse of the discount rate and smoothing. Remember, CalPERS recently raised the number of smoothing years, which, according to this article, makes matters worse because it hides the true costs. What will Pleasanton do since it cannot get accurate accounting information from CalPERS?

"By bearing the burden of covering funding gaps when the economy performs poorly, taxpayers provide valuable insurance to public employees, but that's not reflected on pension balance sheets."


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Posted by George Washington
a resident of Pleasanton Middle School
on Jan 30, 2011 at 8:55 pm

John Q. Public would better label himself as I.M. Tea Party. He exemplifies the screwed up kinds of thought processes that run through the movement, unleashing its hatred toward scapegoated others, while cowering behind grade school-like notions of the U.S. constitution. Their intellectual leaders are Sarah Palin and Michelle Bachman. Palin recently demonstrated her ignorance afresh when she commented on Obama's reference to our 'sputnik moment'. It seems in that tiny little brain that does nothing but serve her badly veiled narcissism and desire to be Queen of the Numbskulls, she thought Obama was urging America to follow RUSSIA's lead. What would you expect from a nonreader who couldn't tell us what the Bush Doctrine was? Bachmann recently made the claim, repeatedly and with conviction, that slavery was brought to an end by the country's founding fathers, of whom she mentioned only "one," er, John Quincy Adams, thereby missing the founding fathers by only about 50-60 years. But, more importantly, Bachmann never heard of what brought an end to slavery -- something called the Civil War. This is the kind of twisted blather that exemplifies the Tea Party movement. The movement's deplorable ignorance and unabashed desire to inflict pain on others is a blight upon this land.


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Posted by Bart Hughes
a resident of Another Pleasanton neighborhood
on Jan 31, 2011 at 8:26 am

I long for the day when we can all focus on solving the big issues we face rather than denegrating each other.


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Posted by SteveP
a resident of Parkside
on Jan 31, 2011 at 8:33 am

SteveP is a registered user.

George Washington-you need to take your Prozac today otherwise your unbridled hatred for those not sucking from the govt teat will make your head explode. Your extremist views are totally counter to the story the editor posted (civility, remember?).
While the police can certainly be at the City Council meetings (off duty), they won't intimidate most conscientious, law-biding citizens. They have every right to be there to witness the public exposure of their lucrative contracts and let the Council and the public at large determine what's reasonable and fair for all in the current economic climate.
P.S.-it's not the Tea Party's fault. They are not the one's espousing any hatred here. Just bringing negotiations into the light of day is not 'hatred', it's the responsible thing to do. Of course, if you stand to lose part of your millions in lifetime pension benefits, I guess your entitled to your rant.


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Posted by Stacey
a resident of Amberwood/Wood Meadows
on Jan 31, 2011 at 8:44 am

Stacey is a registered user.

Give me a break wrote: "asking the public employees of this town to lose significant amounts of income"

Contributing to retirement is called "deferred income". Both what the employer and employee pays towards retirement is still income. Typically such deferred income is not taxed until an actual distribution is received. So no, no one will actually lose income unless they end up getting laid off due to the cuts in service we will surely experience if we cannot get pension reform right.


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Posted by b
a resident of Another Pleasanton neighborhood
on Jan 31, 2011 at 8:54 am

Stacey, not sure I agree with you on that one. The lack of smoothing is what has sent contribution rates soaring the past few years. Without smoothing, agencies are hit with big catch-up bills when they can least afford to pay them.

As an extreme example, what if agencies had been forced to make contributions to immediately offset the 2008 stock market losses? Those agencies would have all been instantly bankrupted, only to see the market recover the following year.

Even though that's a slightly unrealistic example, it is what is slowly happening now. Contribution rates continue to soar, largely because of the market losses of the past couple years. If market losses continue for many, many years, that is a big problem for the investment fund. But if the economy and markets recover within a few years (which is clearly in-progress now) and return to the mean, it is not a problem at all. Either way, the smoothing formulas protect both the investment fund and the agencies.

Long-term smoothing is a good thing. It allows for more predictable budgeting year-to-year. It very appropriately matches the contributions to the long-term performance of long-term investment plans.


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Posted by b
a resident of Another Pleasanton neighborhood
on Jan 31, 2011 at 9:01 am

I should've said "appropriate" smoothing. I understand there's already a smoothing formula. I believe it is too short-term.

The funds should be allowed to take reasonable market risk, which means there's going to be short-term fluctuations. This is completely appropriate for a long-term retirement-oriented investment fund.

It is completely unreasonable to force any long-term investor to compensate for short-term market fluctuations.


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Posted by Stacey
a resident of Amberwood/Wood Meadows
on Jan 31, 2011 at 9:05 am

Stacey is a registered user.

There was no lack of smoothing. The issue is the length of time over which to smooth, with longer periods being a gimmick by which to mislead. Contributions rates are affected both by the market performance and increases in pension benefits that were never paid for. So with an inaccurate outlook due to too long of a smoothing period, we'll end up with continued underfunding as we won't be contributing enough.


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Posted by Stacey
a resident of Amberwood/Wood Meadows
on Jan 31, 2011 at 9:08 am

Stacey is a registered user.

We cannot look at CalPERS as simply a long-term investment fund. It pays out benefits as it takes in contributions.


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Posted by Bart Hughes
a resident of Another Pleasanton neighborhood
on Jan 31, 2011 at 9:34 am

So b, how many times should CalPERS be able to smooth? They have already done it twice. And over how many years? I'm sure you appreciate that the longer the time period, the greater the "tax" will be on future generations?

When does all this gamesmanship become critical in your eyes? Historically MVA has been greater than AVA. (Pleasanton uses AVA to report out their unfunded liability which is why their numbers are lower than mine). Today, MVA is much lower than AVA and is as low as 52% for Pleasanton.

FYI, CalPERS and other large public pension funds are currently being investigated by the SEC for this smoothing gamesmanship and the misrepresentation it creates.

Make sure you read this article today:

Web Link


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Posted by Stacey
a resident of Amberwood/Wood Meadows
on Jan 31, 2011 at 10:27 am

Stacey is a registered user.

The view from the creditors: Web Link

"pension funding pressures will continue to have a negative impact on state credit quality and state ratings. Moody's also recognizes that, as currently reported, pension liabilities may be understated."

"Pension underfunding has been driven by weaker-than-expected investment results, previous benefit enhancements, and, in some states, failure to pay the annual required contribution to the pension fund," says Hampton. "Demographic factors -- including the retirement of Baby Boom-generation state employees and beneficiaries' increasing life expectancy -- are also adding to liabilities."


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Posted by Huh
a resident of Another Pleasanton neighborhood
on Jan 31, 2011 at 3:03 pm

I did not think this contract included the PPD.

I hope GW is not on the force, it would be scary if he/she had a gun.


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Posted by Arnold
a resident of Another Pleasanton neighborhood
on Jan 31, 2011 at 3:45 pm

Pink Slips and Pension Red Ink
In California, it's "pension layoffs" vs. "pension attrition."
BY: Girard Miller | January 20, 2011

"The chickens have come home to roost in the California municipal pension community. After waiting past the November 2010 elections to avoid political limelight, the state's largest pension fund belatedly gave local government officials a rude awakening about their projected pension cost increases."

- while it's true that CalPERS delayed issuing cities the actual pension cost increases until after the elections, IMO, for fear that it would adversely effect democratic politicians that supported the unions, it isn't true that that local governments weren't aware of this increasing cost. Just like the current CalPERS projections predict future costs - so did the previous projections.

"One city, Pasadena, has responded by laying off management workers in an effort to rein in personnel costs that are now obviously unsustainable in light of skyrocketing pension bills. According to news reports, the Pasadena layoffs will save the city about $5 million in the context of a pension-cost increase of twice that magnitude."

- seems to be a shallow but articulate attempt at convincing taxpayers that the savings are actually solid efforts at controlling costs - when the truth is it's a fancy way of saying costs are increasing 100% but we're getting a 50% discount from the doubling of costs. I guess they're trying to re-frame the argument. Pleasanton has provided the same type of misleading savings projections.

Moving down the article and this speaks to Stacey's previous comments and the link about pension smoothing. In that link the concern was about increasing the smoothing to ten years. Here are Girard Miller's comments on what CalPERS is doing:

"How high will this flood crest? Local employers are now skeptical that they have been told the full truth about how high their pension costs will ultimately surge. Unlike the vast majority of public pension funds, CalPERS uses a 15-year actuarial smoothing process that camouflages the genuine economic impact of market fluctuations. I have no issue with normal industry-standard actuarial smoothing periods of 5 years, in light of the average length of a business cycle — which is 6 years based on 14 recession cycles in the past 84 years. But the CalPERS process is opaque and flunks the transparency test that taxpayers, public managers and municipal bond investors are entitled to expect. As I have explained before, such extraordinary "smoothing" practices deserve SEC investigation as an "artifice and device" to conceal relevant financial information from the investment community — as well as the employers who must now bear the financial brunt of unsustainable pension benefits."

- Is CalPERS smoothing us through one recovery and into the next downturn?

Good article and you can read it here: Web Link


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Posted by Joe Akista
a resident of Castlewood
on Mar 8, 2011 at 3:21 pm

Pension Reform is a good thing for Pleasanton. We should reform the Police pension. They make $300,000 a year!

That is so unfair to the tax payers.


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Posted by Larry Rosenburg
a resident of Foothill Knolls
on Mar 8, 2011 at 3:28 pm

Thanks for pointing this out.

I have my Master's Degree and make only 30,000 dollars/year without a pension in the private sector. Furthermore, I was lucky to find that job after being unemployeed for 3 years.

I feel insulted that my hard earned tax dollars are being abused in such a way. The average Police department salary is 120,000 dollars/year with enormous pensions.

Work at the Pleasanton Police Department for a couple of years and you will become a Millionaire.


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Posted by Sarah Smith
a resident of Civic Square
on Mar 8, 2011 at 3:39 pm

I agree; it is unfair that well educated residents in Pleasanton have to pay for the lavish lifestyles of the public servants. It is not fair that the average Police Officer can become a multi-millionare on taxpayer's expense.

The Police Department need to make sacrifices like everyone else. Their lavish lifestyles are bankrupting our city and state.

Wake up Pleasanton.


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Posted by Mike Hightower
a resident of Del Prado
on Mar 8, 2011 at 3:48 pm

As a proud memeber of a trade union, I stand for working men and women.

My union had to make concessions because of the budget stituation. We saw the big picture and were willing to make temporary sacrifices for the good of our organization. However, the union which represents the Pleasanton Police Department is unwilling to make any sacrifices for the good of the city.

There is no money for your excessive compensation. Period.

Now put away your self interests and make the temporary sacrifices like everyone else!


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