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Facts regarding Pleasanton's entitlements issue

Original post made by GX, Foothill High School, on Nov 8, 2010

Did you know (all these are facts that can be confirmed with City Management):

- An incremental $46M has been siphoned off from city services over the past 6 years to pay for incremental public employee entitlement costs
- We spend an extra $10M/year compared to 6 years ago to pay for entitlement costs
- Entitlement costs are growing at 700% of baseline and eats up nearly 10% of our budget
- Entitlement costs increased by 5% last year when the overall budget declined by 6%
- Most city employees contribute nothing to their retirement funds - the city picks up their portion
- City employment rules just enabled Fraser, our chief of police for 3 years, to retire at 56 from a desk job with a retirement package of $4.9M+ (my own NPV estimate based on actuarial facts)

This issue has been growing for years and City management/Council has only made token changes to the system. Ask yourself why this is the case?

In the meantime, the city will look for every way it can to raise fees/taxes, short-change reserve accounts, etc. to cover this.

Average citizens of Pleasanton will continue to be short-changed until the Council/management finds the courage to stand up to public employee unions.

Comments (30)

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Posted by A Neighbor
a resident of Another Pleasanton neighborhood
on Nov 8, 2010 at 8:18 am

Gx, You posted this same information 3 days ago. Why did you post it again? It seems unlikely that something drastic changed over the weekend.


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Posted by Maja7
a resident of Vintage Hills Elementary School
on Nov 8, 2010 at 8:55 am

What was inappropriate about GX's prior response that it was 'erased' by PW???? I read it a minute or so ago and now it's gone. Isn't the town forum suppose to be generating conversation not stifling it??? Come on PW, ease up on the censorship.


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Posted by Interested
a resident of Another Pleasanton neighborhood
on Nov 8, 2010 at 1:15 pm

GX - can you tell us what we or the city council can do about public unions? Are the employees and collecting individuals only part of a local union, or is it a larger union? Thanks.


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Posted by GX
a resident of Foothill High School
on Nov 8, 2010 at 3:02 pm

I believe Pleasanton has local unions (except for the fire department which is shared with Livermore), but I don't know for sure. I do know that the City Council via City management has the ability to negotiate directly with unions and change terms of contracts. Management will say they have done this/are doing this but all they can show for it is a 2% contribution by the fire department and a two-tiered pension program (grossly unfair to future employees).

What management hasn't achieved yet is getting employees to pick up their portion of their pension contributions. I don't understand this as this problem has been growing for at least six years.

Getting employees to pick up their portion is a minimum first step. Remember SB400 (the Davis pension give-away to public unions)was passed with the assumptions that it wouldn't cost taxpayers any extra. Taxpayers have been picking up the extra costs for the past 10+ years. It is time for employees, especially those that will benefit the most from current rules, to start contributing more.

But until there is more pressure from the public, nothing will change.


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Posted by Bruce
a resident of Pleasanton Heights
on Nov 8, 2010 at 4:45 pm

The Government unions based their pension plans on what corporations used to provide their employees, except they left out the only thing that made them affordable to the corporations, and that is the reduction in benefit for early retirement. We need to reduce the benefits to a discounted present value for retirement before age 65. That would make most of the plans semi affordable. If that doesn't solve the affordability problem, we may need to tweak the vesting percentages. I aslo wonder how a city can have so many unfilled positions and still accomplish rhe work. Maybe its time for the city to hire some efficiency experts to decide how many employees we need. How many building inspectors have been laid off since the housng downturn? etc, etc?


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 8, 2010 at 6:09 pm

Einstein is a registered user.

I can only assume that because PW keeps either shutting this blog down or changing it to members only is because they are trying to suppress discussion of this issue for reasons only known to them but it makes one wonder if PW is in collaboration with the city and elected officials who are involved in this level of graft and giving to their cronies and appointees. Clearly, we cannot afford these type of pensions nor future debt, therefore, rather than suppressing opinions PW should be leading the effort to undercover what is under this issue and to clearly state the impacts both short term and long term to the fiscal health of our city.

Respectfully yours, Einstein


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Posted by GX
a resident of Foothill High School
on Nov 8, 2010 at 8:03 pm

GX is a registered user.

Bruce - Interesting points. There are likely many ways to make the pensions more affordable and sustainable. But to date, the city has used stall tactics and is hoping that things will get better. In the meantime, more and more of our general fund is going to support the ever increasing retirement tab.

You'd think that the unions would come forward with a reasonable compromise, but I won't hold my breath for that. Instead I continue to look for ways to put more pressure on the City Council to do what is right for the average Pleasanton citizen.

I was hoping that PW could be a part of this, but they continue to avoid the issue. But like it or not the issue will continue to grow - it is not going away.


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Posted by GX
a resident of Foothill High School
on Nov 8, 2010 at 8:05 pm

GX is a registered user.

BTW, PW continues to filter out many of my comments on this subject. PW, are you that afraid of the truth? I thought it was your job as journalists to expose the truth?


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 8, 2010 at 8:14 pm

Einstein is a registered user.

GX,

Would you happen to know what the financial projections are next year, 5 years, and 10 years and what impact this has on the fiscal state of Pleasanton? Additionally, if this information is available, what has the Mayor and Council done to mitigate the problem if anything? I wonder how many retired City Managers, City Attorneys, Fire Chiefs, Police Chiefs were are paying for and if they are even still living in the city or the state for that matter.


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 8, 2010 at 8:18 pm

Einstein is a registered user.

Gx,

By the way, unions never come out with a solution first and only when confronted with disaster do they move at all. Remember, that are elected officials and owe their positions to standing up for their people and not acting in the best interests of the masses. Ask the NUMMI folks.


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Posted by GX
a resident of Foothill High School
on Nov 8, 2010 at 8:35 pm

GX is a registered user.

Einstein - I've asked for forward projections from the city but they won't share it. I suspect the reason why is that it shows and ever worsening picture.

Heck, when the system enables Police Chief Fraser to retire at 56 with a $4.9M pension, it's got to be getting substantially worse.

They keep saying they are going to discuss this next spring as they prepare the new financial plan. In the meantime, 6+ years have gone by and no meaningful reform has occured. More stalling ...

Stay tuned for more information. I'm trying to get the projected costs for FY2010/2011 which I'm sure will show another big increase.

Please help get the word out. It is only going to be people power that will change this and overcome the inaction of the City Council.


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 8, 2010 at 8:52 pm

Einstein is a registered user.

GX,

I started writing about the 3 point state pension system on these blogs 3 years ago but then it never dawned on me that this would impact Pleasanton to the same extent that it will the state. I guess I should have figured it out because a year ago I ran into a policeman who was a friend of mine and he told me he had retired and the reason was he wanted to get on the retirement rolls before the pension plan was changed. I am sure the city council and the mayor are in this neck deep and that is why the info keep disappearing from these blogs. I will make sure everyone is aware of what is going on but do not count on the media to put it in print. I would encourage everyone reading this to register and start posting here. It is easy and they cannot keep you off that way unless they just erase it.


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Posted by GOTV
a resident of Vineyard Avenue
on Nov 8, 2010 at 10:19 pm

GOTV is a registered user.

The pension-reform news in this state on Election Day was overwhelmingly on the good side Web Link in places like Bakersfield, Carlsbad, Redding, Riverside, San Diego, San Francisco, San Jose and Menlo Park, where "voters took the city's fiscal matters into their own hands Tuesday night by voting overwhelmingly in favor of a measure that will reduce pension benefits for all new employees except police," reported the San Jose Mercury News. It passed with 72 percent "yes" votes, which is an astoundingly large victory.


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Posted by GX
a resident of Foothill High School
on Nov 9, 2010 at 7:45 am

GX is a registered user.

Pleasanton will claim that they have taken actions to arrest the problem. Yes they have, but it is not nearly enough. Pension costs continue to grow much faster than the baseline budget and are eating up more of the total funds for city services.

I still can't believe the plan for current employees hasn't been changed by increasing employee contributions and extending retirement ages. These seem like very simple changes that will force those who will benefit the most to contribute.

But no, City management continues to down-play the significance of this issue and City Council has yet to find its backbone on this issue. Are city unions here to serve the citizens of Pleasanton or are the citizens of Pleasanton here to fund the needs of city unions? Right now, it is the latter unfortunately


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 9, 2010 at 12:31 pm

Einstein is a registered user.

GX, I believe you are correct in thinking the council nor our mayor will take this on because messing up like this will not get you elected. I wonder if a city wide referendum would do the trick? If we voted to recind and not to fund these pensions both for individuals currently on retirement and in the future, it would force action on behalf of the unions and our elected officials.


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Posted by GX
a resident of Foothill High School
on Nov 9, 2010 at 2:33 pm

GX is a registered user.

Stay tuned - I am investigating the initiative process Meno Park residents used to pass an entitlements reform initiative. That one passed by an incredible 72%. Clearly average citizens are fed up with the self-serving rules that city management/public unions follow.


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 9, 2010 at 6:12 pm

Einstein is a registered user.

I think if we can get it on the ballot it would pass with a resounding yes and we need to get it done. We can provide something affordable but what we have currently will bankrupct us. I suspect we cannot expect support from the unions nor our elected officials but that is ok because we will not be distracted by competing agendas. Please let me know how I can support.


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 9, 2010 at 6:18 pm

Einstein is a registered user.

GX,

We have had over 800 views of people reading what has been written and I suspect many of those viewing have been elected officials or city representatives. I would request that any of you elected officials viewing this blog to show leadership on this issue in protection of the money of the people who elected you. Ms. Mayor please provide some leadership.


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 9, 2010 at 6:30 pm

Einstein is a registered user.

Here a couple of old but meaningful links

Web Link

Funny none of the people in this next link are still in power. Looks like Kay Ayala was right again.

Web Link


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Posted by GX
a resident of Foothill High School
on Nov 10, 2010 at 7:36 am

GX is a registered user.

Einstein and others who are interested. Momentum is building to create a citizens group around this issue possibly leading to an initiative or other approach.

Does anyone have a mechanism where interested parties can share information offline?


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Posted by GX
a resident of Foothill High School
on Nov 10, 2010 at 7:49 am

GX is a registered user.

Einstein - the historical PW article you published is fascinating. Everyone should read this!

The revised plan was supposed to only cost the city $13M over the next 8 years. According to the City's own records we instead have spent $97M over that period. They were just a little off ... ;-)

And none of the employees have contributed to the overruns. And these figures don't even include the medical obligations.

Wake up people and start speaking up, unless you want to continue to be endentured taxpayers to public employee unions.


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Posted by Stacey
a resident of Amberwood/Wood Meadows
on Nov 10, 2010 at 8:49 am

Stacey is a registered user.

Yes, I have thoughts on this matter. This issue is a concern to me, but I think there's some other things you should try first before resorting to initiative. As you may or may not know from my past posts, I'm not a big fan of the initiative process. Most initiatives are poorly written and do not account for certain unintended consequences. They're sometimes akin to using a chainsaw to do brain surgery.

Sit down first and do some more research regarding the current Pleasanton situation. Do your due diligence. Analyze the Menlo Park situation more in depth. It isn't clear why residents there resorted to the initiative process. Maybe they have a Council that was not sympathetic, but you may find a different situation here if you speak with individual Council members first (for example: Web Link). We also don't know yet if the Menlo Park initiative will hold up in court or what the unintended consequences are. One consequence I can guess at just from what I've seen so far is that it takes away the local elected officials' control in future negotiations (think about how bad the CA budget is as a consequence of how much control to manage the budget has been taken away from legislators by initiative). Another consequence may be that they lose employees to other municipalities that offer better. It would do yourselves good to understand exactly what Menlo Park did and what may be needed here. For example, Einstein seems to think that Menlo Park rescinded something. They did not because it would probably have been thrown out by a court right away. Their initiative only applies to new hires, as it should.

Get your word out to the general public through various forms of outreach. Also, start speaking at the open public comment period at Council meetings about your findings. If you form a group and show up to speak about this subject en masse at Council meetings (lobbying!), you may find you get better traction through that process. Local government is you, but only if you engage it and engaging means more than just voting, initiatives, and referenda. Also, you'll be saving taxpayers from election costs.


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Posted by GX
a resident of Foothill High School
on Nov 10, 2010 at 9:33 am

GX is a registered user.

Stacey - Thanks for your comments and perspectives. I appreciate where you are coming from from an initiative perspective. This would not be my first choice, but I will no longer stand for inaction. It is inexuseable.

I have spoken to individual Council members and while they in private will acknowledge the issue, they also admit there is not enough political will (yet) to go against the unions. It is up to us individual citizens to shed light on the issue and raise the pressure to enable action.

I did speak at the last City Council forum and plan to speak at the next one. It would be great to get others there. I've got plenty of facts. Just ask and I will provide what I have.

I for one don't want to have caustic relationships with our hard working city employees, but enough is enough. They have contributed nothing to help solve this problem and it is time they do. And unions are just standing in the way.

BTW, I'm not too concerned about employee turn-over which is actually healthy for organizations according to most organization management professionals. Plus with the current economic environment, there won't be a wealth of higher compension positions. In fact, many private sector employees would jump at the chance these days to get one of these jobs.


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Posted by Stacey
a resident of Amberwood/Wood Meadows
on Nov 10, 2010 at 9:49 am

Stacey is a registered user.

GX,

You'll get the political will generated if you can form a group of interested individuals to apply pressure. The economic times and national focus on the subject give you the opportunity to do that more easily.

I need to dig it up later for you. There was something I saw recently online about pension reform. The basic gist was the idea that shifting pension obligations from the employer more to the employee (which I think needs to be done in part) doesn't solve the issue of underfunded pensions. There are some municipalities looking at a more hybrid approach of offering 401(k)-like retirement benefits.


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Posted by GX
a resident of Foothill High School
on Nov 10, 2010 at 9:52 am

GX is a registered user.

For those who have read Stacey link to the PW piece that describes the concessions Pleasanton got from our police department, please note that is is just window dressing and does very little to solve our issue.

Look at the facts. Pleasanton's medical retirement fund is only about 60% funded - a very grave situation. Also, entitlements are still growing much faster than the baseline city budget and is therefore crowding out other services.

The City Council still has not made the hard decisions. And until they do, we all will be the poorer for it.

If they do not take actions, citizens may be forced to via the initiative process. Keep in mind that 9 out of 10 bay area reform initiatives passed in this past election.


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 10, 2010 at 2:02 pm

Einstein is a registered user.

Pleasanton Weekly, would you be kind enough to unlock this blog so that everyone else can be engaged?


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 10, 2010 at 2:08 pm

Einstein is a registered user.

Stacey, I agree with some of your comments about the referendum process but if we do not have elected officials who are willing to lookout for the best interests of the citizens it is up to the citizens to protect themselves through well thoughtout referendums.


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Posted by Stacey
a resident of Amberwood/Wood Meadows
on Nov 10, 2010 at 11:49 pm

Stacey is a registered user.

Check out this website for all your California public pension news: Web Link

I'm still looking for that other article I said I'd dig up...

Einstein,
All I'm saying is to try to use the door before resorting to a bulldozer.


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Posted by Einstein
a resident of Mohr Elementary School
on Nov 11, 2010 at 6:39 am

Einstein is a registered user.

Thank you Stacey and I agree with you but on the other hand it appears a bulldozer will be required because we cannot even get PW to open up this blog nor any of our elected officials to show leadership and take on the issue itself. I think a bulldozer on this issue and others will be required. Unless we can get our elected officials to show leadership and work in the interests of their constituents then I believe you are going to see the referendum process being used over and over unfortunately, it is up to the officials to either fix problems or have the problems fixed for them by the people.


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Posted by sknywench
a resident of Amador Valley High School
on Nov 12, 2010 at 10:52 am

sknywench is a registered user.

I believe this is a much bigger problem that was not created by the little o' Pleasanton City Council. City, County and State government is struggling all over California and reform must be made. Its battling the labor unions and of course PERS, the biggest of them all. Many ideas are being raised which have merit such as reduced benefit for retirement prior to SSI retirement age, more employee contribution and perhaps tied to the PERS investment returns or a maximum percentage of a City's general fund. I dont think having new employees pay a different or greater rate is the solution - what an inequity and morale buster. We also need to do a real and meaningful analysis of efficiency since I believe many cities are over-staffed from the glory economy days. When public sector workers think its a big sacrifice to take only a 1 - 2 % or zero salary COI increase during these tough economic times, that's a serious dysfunctional disconnect.


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