city of Ventura Archives

Posts

This Is Why The Decade Of The 2010s Is Important

December 24, 2019/in Newsletters/by VREG Editors

“Do not suffer your good nature…to say yes when you ought to say no.”

—George Washington

As the 21^st century teeters between the 2010s and the 2020s, it’s a perfect time to take stock of an eventful decade. Over the last ten years, several key events changed Ventura forever. Let’s look at what happened and the effect these incidents had.

How We’ll Remember The 2010s

We’ll remember the 2010s as a decade that began with the city struggling to get out of a recession, followed by ten years of decisions made with good intentions gone wrong. Bureaucrats and politicians pushed their agendas on the city. And like Sisyphus pushing the boulder up the hill, we kept falling backward.

It’s remarkable that the city accomplished anything in the 2010s. We had three City Managers and three Interim City Managers. No one person was in the role for more than three years. Turnover created a leadership vacuum that minimized any chance for meaningful change.

Key Events In The Decade Of The 2010s

The 2010s started as “business as usual.” Then the Thomas Fire happened. Citizens quickly became interested in how the Ventura would handle two issues: public safety during and after the fire, and rebuilding. After twelve months of intense interest, citizens have returned to “business as usual.”

Here are the key events of the decade: the Thomas Fire, December 2017; the Wishtoyo Consent Decree, 2012; Pension Inflation, 2010-2019; Homelessness, 2010-2019; the Anthony Mele, Jr. murder, April 2018; Brooks Institute’s failure, 2016; the WAV Building, 2012; Ventura’s Grand Jury Finding against Ventura’s building & safety inspectors, 2013; and district elections. Let’s look at what happened in each case and how it affects you.

The Thomas Fire

The biggest misfortune in Ventura’s history was the Thomas Fire, which began on December 4, 2017. The fire destroyed 535 structures in the city, displacing hundreds of residents and impacting everyone’s lives.

During the fire, Ventura’s public safety performed admirably. Despite the widespread devastation, police and fire protected the lives of everyone living in the city. Evacuations were orderly, albeit slow. There were many stories of heroic efforts by police and fire going beyond the call of duty.

Other aspects of the city’s performance didn’t go so well. Several groups pilloried Ventura Water for inadequate water supply to fire hydrants in the affected areas. An investigation is on-going. So are lawsuits.

The City Council added to the misery of the victims in an example of good intentions gone bad. The Council waffled on second-story height restrictions for rebuilding victims’ homes. Indecisiveness delayed the rebuilding process for many. They attempted to please fire victims wanting to improve their homes and doing so delayed rebuilding for everyone.

After two years, only 80 families have returned to their rebuilt homes.

The Wishtoyo Consent Decree

The Consent Decree stems from a federal complaint filed by Whistoya Foundation [WISHTOYA VS. CITY OF SAN BUENAVENTURA, CASE NO. CV 10-02072]. The Consent Decree requires Ventura to stop putting 100% of its treated wastewater into the Santa Clara River estuary. The city must divert a percentage of the 7.5 million gallons-per-day starting in 2025. The balance must be redirected by 2030. That decree is silent on how and where Ventura diverts the wastewater.

Ventura Water seized the opportunity to make the city the first to use recycled wastewater for drinking. Ventura Water calls the project VenturaWaterPure. No cities in the world have used recycled water except Windhoek, Namibia and a small town in Texas. Neither place had other water options.

Ventura Water has confused the City Council by combining two different ideas to falsely heighten the urgency to drink wastewater.

VenturaWaterPure will cost $1 billion over 30 years. That’s a considerable sum of money for the community to absorb. Expect your water bill to double to pay for VenturaWaterPure’s infrastructure alone. Remember, water costs already went up by $220 million with water and wastewater increases in 2012-13.

The Wishtoyo Consent Decree is a fiscal calamity for the city. More cost-effective options exist, but the City Council and Ventura Water fail to consider them. Times change. Circumstances change. Now is the time to reconsider options to be sure we’re making the best choice available.

Pension Inflation Throughout The 2010s

Retirement pensions are the city’s number one problem. Ventura currently has a $215.1 million unfunded pension liability, and that number continues to grow. CalPERS (the California Public Employees retirement fund) demands rapidly increasing contributions from Ventura. We will have permanent increases of at least $2 million per year for five to six consecutive years.

We respect the work city employees do. There is no denying that fire and police preform a vital job that is both dangerous and requires a high level of training and responsibility. Our concern is not about their work. It’s about the structure by which their retirement is accumulated and paid after retirement.

It is undeniable that city employees’ retirement pensions are crowding out the city’s ability to provide the service itself. Moreover, chronic underfunding of pensions will eventually hit a breaking point jeopardizing the employees’ benefits too. Expect your taxes to increase (á la Measure O) and the services the city provides to decrease.

Homelessness In Ventura In The 2010s

You may remember Dwight D. Eisenhower’s Farewell Speech when he described the Military-Industrial Complex. Now, we have something new, the Homelessness-Industrial Complex. Today’s Homelessness-Industrial Complex shares some of the same characteristics as the Military-Industrial Complex. There is an alliance of special interests. It includes government bureaucracies, homeless advocacy groups operating through nonprofit entities, and large government contractors, especially construction companies and land development firms.

Here’s how the process works: Developers accept public money to build projects to house the homeless – either “bridge housing,” or “permanent supportive housing.” Cities and counties collect building fees and hire bureaucrats for oversight. The projects are then handed off to nonprofits with long term contracts to run them.

Sounds good, right? That is until you see the price tag. Developers don’t just build housing projects; they construct ridiculously overpriced, overbuilt housing projects. (Keep in mind Ventura’s permitting fees and stringent building codes). Cities and counties create massive bureaucracies. The nonprofits don’t just run these projects; they operate vast bureaucratic empires. These fiefdoms have overhead, marketing budgets, and executive salaries that do nothing for the homeless. They do not overpay the workers in the shelter.

Set Up For Failure

Ventura selected Mercy House from Orange County to run its homeless shelter. Larry Haynes, Marcy House’s president, said in a speech in Ventura, “Housing is, ‘An inalienable right.’”

Mr. Haynes believes a cornerstone to Mercy House’s success in Ventura depends on developing affordable housing. Herein lies the rub. If Ventura doesn’t build affordable housing, how does that impact Mercy House’s performance? Affordable housing isn’t something Ventura has been able to do historically. “It makes it harder,” he said.

The City of Ventura has 555 homeless people. Of those, 387 are unsheltered. The Homeless Shelter will house 55 people from Ventura, leaving 332 people vulnerable.

Ventura will spend $712,000 each year for its 55 beds in the new homeless shelter. That equates to $12,945 per bed per year. And if what Mr. Haynes says is true, expect the city to pay more and more on homelessness and less on other services.

Anthony Mele, Jr. Murder

Jamal Jackson stabbed Anthony Mele, Jr. to death on Ventura’s Promenade in April 2018, thrusting the city into the national news.

Jackson was a repeat offender and was homeless. Many citizens jumbled his criminal act and his impoverished state. Of Ventura’s 555 homeless, 85 (32.7%) have mental health problems, and 93 (35.8%) have substance abuse problems.

The crime prompted an immediate reaction by Ventura Police. First, patrols along the promenade increased. At first, two officers patrolled the boardwalk 20 hours per day. Shortly after that, police expanded the patrol radius to include downtown. In July 2018, the City Council approved funds to continue the patrols. Now two officers patrol 12 hours per day. Arrest data increased since the incident. Ventura Police still deal with a significant number of recidivist criminal homeless.

Following the incident, the Police department reviewed its procedures. Chief Ken Corney admitted poor judgment. Substituting video monitoring for an officer responding was not the right choice.

Since then, there have been changes to the security camera monitoring. The changes include:

Extra cameras, active surveillance, more training, changes in monitoring policy, and re-prioritization of Calls for Service response. The review also concluded that the police adequately prioritized the call when it came in.

Public outcry diminished, but the problem of criminal vagrancy continues beyond the 2010s.

Real Estate Blunders Throughout The 2010s

The city mismanages taxpayer money on real estate deal routinely. In the past decade, there have been several notable instances: Brooks Institute, the WAV Building, the Harbor Church and the city parking garage. In each case, the mistakes have cost taxpayers’ money.

Brooks Institute

With Brooks Institute, the City Council believed relocating the school downtown would benefit the city. The City Council’s good intention went wrong. Brooks Institute was financially insolvent. It pulled out of town contractors and the city money.

The folks at City Hall tried hard to put on a brave and jubilant face in trying to explain why their decision to accept $71,000 to settle a lawsuit against Brooks Institute is a victory. Readers of this letter know better. The settlement does not even cover the rents and security deposit that Brooks was to have paid in the first six months of their lease. Nor does it account for the future lost rents and property damages. By our best estimate, the city lost well over $261,000 in this settlement.

The WAV Building

Ventura completed construction on the WAV (Working Artists of Ventura) Building at the beginning of the decade. The building included 82 low income and subsidized housing units, commercial spaces and 13 condos for sale at market rate.

What did the WAV Building cost? $55 million according to the city. That figure is too low, however. It doesn’t consider the cost of the 1.7 acres of city-owned property Ventura sold to the developer for $1. It also doesn’t include the $1.5 million in deferred permit fees. A reasonable estimate put this at $65 million.

The city acquired tax money from many sources to pay for construction, but it was not enough. Then city officials did something devious to finance completing construction. They took $1 million from the Ventura Water funds, transferred it to the Public Art Fund, then loaned the money to the project. Even worse, the city subordinated the loan to a $4.5 million mortgage from Chase. Selling the 13 condos for between $725,000 to $850,000 each would repay the city’s inter-department loan.

The concept flopped. The condos finally sold in 2018 for a fraction of what the city hoped to get. Buyers paid $413,000-$470,000 for the units. Once the sale completed, the mortgage holder, Chase, was repaid both principal and interest. Ventura Water was left holding the bag, however, for the $1 million “loaned” to the city. The city received only $105,893 from the sale of the condos after paying the Construction Loan, sales commissions, sales expenses, the City Deferred Impact Fee Loan and the developer.

What’s more, the city loaned $2 million to the Regional Development Agency (RDA) to build the WAV project. The city expected to be repaid $1 million before the California Assembly eliminated RDAs statewide. Ventura wrote off $1 million when the RDA disappeared. Ventura is pursuing the outstanding principal and interest through the Recognized Obligation Payment Schedule (ROPS), but has received nothing so far.

All totaled, Ventura lost $1,894,107 on the sale of the condos.

Former Mayor Bill Fulton projected the project would “produce 25,000 visitors a year and would stimulate the local economy, resulting in $75,000,000 in new investments.” He also said the city used no local tax dollars to build the WAV Building.

The reality is that most of the money came from Federal and State taxes. But the funds noted above came from the city, plus another $334,176 to offset various construction fees.

As for the $75 million in new investment, we will never know because the estimator, Bill Fulton, left town.

At the time, we noted our elected representatives lack the understanding, the capacity to ask the more profound questions or political will to stop these types of actions.

Harbor Church

The city paid church officials $2.3 million to buy the Harbor Church property in 2016. City Hall and Harbor Church agreed the value of both the land and the church building was $1.6 million. The actual sales price included an extra $700,000 to pay the Church to move. By any measure, Ventura overpaid for the property.

Downtown Parking Garage

And there was a mistake with the city parking garage—the city grants private, reserved parking spaces to select businesses downtown as an incentive to operate. The city approved ten parking spaces to entice Cinemark Theaters to remain downtown. The trouble was when Lure Restaurant opened at 66 California, and the city staff provided them the same ten spots. This may not seem like a big blunder, but it shows that the city is inept at managing real estate, or the staff lacks good leadership to make sure mistakes don’t occur.

We’ve believed the city should get out of the real estate business throughout the 2010s. The litany of poor decisions grows. Ventura owns commercial real estate throughout the city. As these examples demonstrate, the city has not made responsible decisions regarding these properties. At the very least, the city should seek advice from licensed realtors and experts whenever making a real estate decision.

Grand Jury Finding

The 2011-2012 Ventura County Grand Jury opened an inquiry and issued a report condemning the City of Ventura’s Code Enforcement practices. The report addresses the aggressive collection of fees by Code Enforcement, motivated by the need to raise more revenue.

City government and Code Enforcement officers serve a valuable and essential service to our community until they start acting like bullies with their use of force, intimidation, abuse of power and excessive punishment of the citizenry.

At the time, the city’s response to this report demonstrated their lack of understanding or constituted a brazen and irresponsible attempt to obfuscate the truth when they dismissed the report as vague. It was not.

For much of the 2010s, citizens overlooked or forgot the Grand Jury’s report until we had the Thomas Fire. Suddenly, city permitting and inspection of new buildings was of paramount importance. Sadly, stories from the fire’s victims indicate nothing has changed at City Hall.

District Elections

For the first time in Ventura’s history, voting districts divide the city. The districting forced Mayor Neal Andrews and Councilmember Mike Tracy to retire. Councilmember Jim Monahan decided to retire after forty years of service. New Councilmembers are bringing fresh perspective and energy to the Council. They also are facing a steep learning curve to be effective.

Governing by districts means inexperienced new Councilmembers will lead the city. Inexperience leads to two possible outcomes. First, existing Councilmembers and city staff may marginalize them until they gain experience and knowledge. Second, the new City Manager and the city staff may take more control without voter accountability. Neither of these is good.

Citizens will now expect their elected officials to represent their district’s interests. As a result, concern for the city as a whole may take a backseat to districtwide issues. The loss of a citywide perspective on the Council is distressing.

Nowhere was this more evident than in the first forum for District 1 candidates. Citizens expressed concern for a Westside pool, learning how governing by districts will work, affordable housing and labor force opportunities. Very few of these issues aligned with what the outgoing City Councilmembers thought was most important: 1) growth 2) water 3) homelessness and 4) staff accountability.

Editor’s Comments

We will remember the 2010s as one of the most significant decades in Ventura’s history. It was a decade that saw our city leaders allow uninformed good intentions to overrule good governing. As a result, the city finds itself with budget deficits for the next five years. This is due, in part, to a growing pension debt obligation. The city is poised to pass along the most substantial rate increase for water in its history. The money the city spends on homelessness will grow. So, it shouldn’t come as a surprise that the city will have to raise taxes, cut services or a combination of the two.

The groundwork laid by city leaders in the 2010s provides a shaky foundation for the 2020s. The specter of higher taxes and reduced city services looms. Several things must happen to overcome the city’s current situation.

First, The City Council must have a cohesive, long-term vision. That vision must focus on the fundamentals of governing: public safety, maintained streets, safe neighborhoods, clean, affordable water, and business growth. In the early 2010s, the Council had a vision, but it didn’t concentrate on the fundamentals. As a result, the Council left the city with the Wishtoyo Consent Decree and the WAV Building. From 2013 on, the Council was divided and lacked any vision. The landmark accomplishment of those Councils was to push the Measure O sales tax increase. Yet, if you ask ordinary citizens how the extra money helps them, they’d be hard-pressed to answer.

Second, Ventura must retain a City Manager for more than three years. The City Manager leads the city staff to fulfill the City Council’s vision. Constant turnover disrupts that vision. A City Manager needs time to build a team and get them performing at a high level. We hope our current City Manager, Alex McIntyre, will have the opportunity to show the city what he’s capable of doing.

Third, voters must get involved. District voting means every vote is more important than it’s ever been. Your vote is one in 15,000 potential voters in your district. Your ballot carries more value than it did when we had citywide elections and your vote was one of 64,976. If the city is to overcome the current obstacles, we can’t have districts in which only 3,781 voters cast ballots.

Tell City Council, “Don’t Repeat The Mistakes Of The 2010s.”

Below you’ll find the photos of our current City Council. Click on any Councilmember’s photo and you’ll open your email program ready to write directly to that Councilmember.

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

Why You Should Worry About VenturaWaterPure

November 26, 2019/in Newsletters/by VREG Editors

“And it never failed that during the dry years the people forgot about the rich years, and during the wet years they lost all memory of the dry years. It was always that way.”

—John Steinbeck, East of Eden

For the second time in four years, Ventura Water failed to present scientific findings that challenged its decision on VenturaWaterPure. Either Ventura Water withheld this pertinent information from the Ventura Council, or it is unaware of the reality that Indirect Potable Reuse (IPR) is unhealthy.

IPR presents a danger to humans. The September 2019 study from the University of Southern California (USC) concludes that IPR contaminates water with antibiotic-resistant bacteria. Once infected with the bacteria, medical science cannot combat these antibiotic-resistant strains.

Reasons VenturaWaterPure Is Not Ideal

There are several reasons VentuaWaterPure is not an ideal solution. For whatever reason, Gina Dorrington, Ventura Water’s Assistant General Manager, neglected to tell the Council about these findings at the October 14th meeting.

It appears that the health of Ventura’s citizens is not a priority in these decisions. Furthermore, it begs the question, “What is the motivation for a misguided recommendation?”

VenturaWaterPure project will need an extra 20-27 employees, according to Susan Rungren, Ventura Water’s General Manager. Each employee will earn a pension. At a time when rising unfunded pension liabilities threaten the city’s finances, the prudence of adding 20%-27% more employees to Ventura Water is questionable.

VenturaWaterPure will cost $1 billion over 30 years. That’s a considerable sum of money for the community to absorb. Water bills will double to pay for VenturaWaterPure’s infrastructure alone. Operations and maintenance costs will add even more. Remember, water costs already went up by $220 million with water and wastewater increases in 2012-13.

To recommend anything contrary to moving forward on this project would not only jeopardize many jobs, but it would also imply that past City Councils and City Managers were wrong with previous decisions, and we have wasted millions of dollars in the process.

City Council Has Its Motivation To Approve Plan To Spend $1 Billion To Drink Wastewater

The City Council has been rushed by Ventura Water to comply with a Consent Decree Ventura agreed to in 2012. The 2012 Consent Decree with Wishtoyo Foundation contended that Ventura Water was dumping its waste into the Santa Clara River Estuary and harming the Santa Clara estuary. The decree requires Ventura to divert seven million gallons a day beginning in 2025 and concluding no later than 2030. What better way to justify a horrible decision than to convince people that it was for their good? They pointed to drought conditions and offered VenturaWaterPure as the solution.

When anyone is looking to justify a bad or ill-conceived idea, they look for another similar decision to defend their own. A case in point is finding other locations in California that have made bad decisions. Misery (bad choices) enjoys company. Two locations in California, Orange County and Monterrey, use Indirect Portable Reuse (IPR). The real question should be ‘Why only two?’ It took Monterrey 10 years to get a permit and build it. That alone is not a sound reason to pursue this premature direction to recycle wastewater in drinking water.

By misdirecting attention to drinking water—fundamental to life—it created the misperceived need for VenturaWaterPure. Complying with the Consent Decree is not the same as providing drinking water. Yet Ventura Water has been mingling the two needs since 2011. Separating the two issues helps make decisions more transparent.

Conflating Two Issues To Achieve The Desired Result

Ventura Water has confused the City Council by combining two different ideas to falsely heighten the urgency to drink wastewater. Since 2011, the campaign has been “We are short of water,” they say, “and the best way to meet that shortage is to drink wastewater.”

Ventura Water was quick to adopt DPR as the solution for an alternative water source. Then-Ventura Water General Manager Shana Epstein had no data to support that assertion, except for the representations of the sales company designing the hardware for VenturaWaterPure. Ms. Epstein repeatedly announced it was good water to drink. She and the other supporting that view were dead wrong.

Dispelling the Myth about Drinking Water

Ventura has enough drinking water for the next 15 years at current consumption rates, according to the 2019 Ventura Water Report (Table 4-3, p. 65). Unlike most cities in California, we are fortunate to be bounded by Ventura and Santa Clara rivers, Lake Casitas, plus groundwater basins.

To add more reserves, in 2018, the City Council approved a project to construct a pipeline to access a new water source—State Water. Besides providing more water to the city, we can mix State Water with our existing water to improve the taste of Eastside water. Ventura has had this option for the last 47 years.

Ventura Water’s public objection to State Water as a primary source has been that it is not available in dry years. They contend that State Water is thus “unreliable.” However, allocations of State Water over the past five drought years have averaged 55% of the contracted allowance. Ventura Water also conveniently ignores the fact that 75% of Ventura County relies on State water as a primary water resource.

Missing the Consent Decree Deadline

We may not be able to meet the timing of the Consent Decree if we pursue VenturaWaterPure. It took Monterrey ten years to apply for permits, be granted permission from the different agencies and build its IPR plant. Ventura has not applied for a single permit to begin constructing its plant. If it takes ten years from today to complete our plant, we will miss the Consent Decree deadline by five years. There’s no reason to believe Ventura will apply for permits and build its plant faster than ten years. VenturaWaterPure is destined to miss its target date.

A Waste of $1 Billion For VenturaWaterPure

IPR is inefficient and will not meet Ventura Water’s projections. Orange County and Monterrey use IPR already. IPR shows a net water loss of 23%, based on Orange County’s experience. If VentuaWaterPure treats 4.5 million gallons per day of tertiary water, this will yield approximately 3.5 million gallons per day of drinking water, or about 3,900 Acre-Feet per year (AFY). According to the Final Environmental Impact Study, that is 1,500 AFY short of the 5,400 AFY needed to meet Ventura’s estimated demand.

The fact is that Ventura reduced its wastewater by 17% from 2009-2018, despite increasing water connections by 3.5% (according to the Comprehensive Annual Financial Report). The amount of wastewater sent to VenturaWaterPure is decreasing. We can reduce the affluent further by using more tertiary water for irrigation in the city. Ventura could increase to 1,200 AFY for irrigation from the current level of approximately 500 AFY. The cost to ratepayers is only the cost of a pipeline for the delivery of tertiary water.

Ventura’s Imprudent Decisions

This City Council has shown a propensity to pay for the same outcome they could have gotten for less. We saw this when the city placed its high-use electricity accounts in the Clean Power Alliance. We may be witnessing it again with VenturaWaterPure.

The opportunity exists to adhere to the Consent Decree at half the cost to ratepayers compared to VenturaWaterPure. For the price of a pipeline, Oxnard will take Ventura’s treated tertiary water. They may even provide Ventura clean water credits. It’s unthinkable not to consider Oxnard Advanced Water Treatment Facility (AWTF) as an option.

Editors Comments

Every citizen should have serious doubts about the pragmatism of the City Council’s decision to fund VenturaWaterPure. It’s time to slow down. Some studies show that VenturaWaterPure is unsafe. Ventura Water for six years has continued to announce that it is safe for human consumption. Yet, the fact that there isn’t a consensus among scientists should be a warning flag to Councilmembers. Do they want to be remembered as supporting VenturaWaterPure if it’s shown to be unsafe, unregulated and unhealthy in the future? Let’s hope not.

One billion dollars is a large bet to place with the taxpayer and ratepayer money for a process that is questionable among scientists. There are cost-effective alternatives available, but it’s unlikely they’ve been examined since the initial decision to create VenturaWaterPure was made in 2011. Times change. Circumstances change. Now is the time to reconsider options to be sure we’re making the best choice available.

Reverse the decision to proceed with IPR, and certainly DPR, until there is more investigation on its safety. The Council is dealing with public health. The Council reversed its decision on DPR in 2018 when they learned a state expert panel deemed DPR unsafe. The Council should be prudent with IPR and change or pause that decision, too.

Finally, the City Council should more rigorously question Ventura Water on its proposals and actions. Twice, Ventura Water has failed to present scientific findings that challenged its direction with VenturaWaterPure. The Council would do well to keep in mind the adage, “Fool me once, shame on me. Fool me twice, shame on you.”

Tell City Council, “Slow Down On VenturaWaterPure!”

Below you’ll find the photos of our current City Council. Click on any Councilmember’s photo and you’ll open your email program ready to write directly to that Councilmember.

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

Scrutinizing Travel Expenses From Conferences

Do You Know The Truth About Ventura’s Spending On Conferences?

October 22, 2019/in Newsletters/by VREG Editors

“Three groups spend other people’s money: children, thieves and politicians. All three need supervision.”

—Dick Armey

The cost and benefit of every spending decision by Ventura’s City Council is magnified as the city faces budgetary losses for the next five years. The city is projecting to have a $10-$25 million shortfall during that time, so the City Council should be more careful how it spends tax dollars. Are we getting our money’s worth from our Councilmembers’ travel to conferences and seminars?

The City Councilmembers don’t think anyone is watching their spending or cares what they do. They believe voters gave them the mandate to be concerned with the details of how and where the city spends money. And, they’re right—to a degree. While citizens fret over the large expenditures on pensions, water, public safety, and staffing, it’s easy to overlook the spending habits of our elected officials.

Conference Boondoggles

The city publishes the expenditures by each sitting Councilmember quarterly. Here’s a summary of the expenses for the past three full fiscal years of the active members of Council:

It’s immediately clear that the spending by the active Councilmembers is rising year-over-year. It jumped 32% to $15,964 from $12,039 from Fiscal Year 2016-2017 to Fiscal Year 2017-2018. It increased 76% to $28,098 from $15,964 from Fiscal Year 2017-2018 to Fiscal Year 2018-2019.

Highlighted in yellow is the amount spent each year to attend the National League of Cities (NLC) Conferences. The NLC holds regional conferences and a national conference in Washington, DC.

Where’s The Value From The Conferences?

Ventura taxpayers get little information about the benefits the city derives from these conferences. There are no written reports of what the attendees accomplished. Sometimes, there is a verbal report made to the Economic Development Committee of what happened, as we see in the Agenda for the April 2nd meeting.

There are no meeting minutes posted for the public of the Economic Development Committee meetings. Nor are the sessions videotaped. There is no permanent record of what happened. There are no archives to refer to in the future. What’s more, the entire City Council doesn’t hear about the findings.

If all the value we receive is a report on the “relevant legislative issues from the NLC,” do we need to send representatives to Washington, D.C.? Couldn’t we get the same information by email or in written form? If we did, there would be a permanent record of the discussions for others to review.

The Value Is In The Connections

The attending City Councilmembers may claim the value of attending these meetings is in the contacts Ventura nurtures with other politicians throughout the country. That’s a specious argument. The relationships are personal between our serving Councilmembers and the people they meet. Those relationships break whenever our Councilmember or his/her contact leaves the office. What’s more, the value in a relationship with a politician in another city has a small direct impact on Ventura.

The justification may be to learn the “best practices” from other cities attending the conferences. What best practices did we learn on homelessness from representatives from Sacramento, Los Angeles, San Francisco, or Seattle? Homelessness in those cities is worse than it is in Ventura, and it’s not improving. Or did we learn something about water from Sacramento? Except, the California River Tunnel isn’t working out so well. Or did the reps from Washington, D.C., or Sacramento teach us about budgeting? The fact is, our reps need to convey any best practices we learned at those conferences need to city staff. The staff are the ones to put in place new ideas in City Hall. And without written guidelines, implementing the changes is nearly impossible.

The truth is any networking with others at these conferences is nothing more than socializing. Should we pay the expenses for two Councilmembers to hobnob with politicians? No.

Next Conference

Mayor Matt LaVere, Deputy Mayor Sofia Rubalcava, and Councilmember Brown are attending the National League of Cities Regional Meeting in Long Beach, CA, on October 16-18, 2019. What value will Ventura get from sending three Councilmembers to this meeting?

Editor’s Comments

In the best of times, these conferences may benefit Ventura, but these are not the best of times. The city faces a multimillion-dollar shortfall over the next five years. Frivolous spending of any kind must not happen, regardless of the dollar amount spent. Spending taxpayer money on these seminars and conferences may appear to be harmless at first. Still, scrutinize each trip to decide whether it’s a necessity. And if it is determined to be necessary, the value must outweigh the expense.

Tell City Council, “Spend Better On Conferences!”

Below you’ll find the photos of our current City Council. Click on any Councilmember’s photo and you’ll open your email program ready to write directly to that Councilmember.

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

Retirement Pensions Are Our #1 Problem (and what you need to know about it)

September 17, 2019/in Newsletters/by VREG Editors

“It’s not what we don’t know that hurts us, it’s what we know that ain’t so.”

—Will Rogers

America’s significant retirement pension funds are underfunded by an unfathomable $4.2 Trillion, according to an August 6 Wall Street Journal article. Ventura mirrors this phenomenon. Ventura workers participate in the state pension fund, CalPERS—the largest in the country. CalPERS is only 71% funded as of June 30, 2018, despite a 10-year bull market and a growing economy.

Because of the chronic funding shortfall, CalPERs demands rapidly increasing contributions from all participating local governments. Ventura will have permanent increases of at least $2 million per year for five to six consecutive years.

It is undeniable that city employees’ retirement pensions are crowding out the city’s ability to provide the service itself. Moreover, chronic underfunding of pensions will eventually hit a breaking point jeopardizing benefits too. Something in this equation has to change.

Retirement Pensions Today

Most state, county and local pension benefits are considered to carry a virtually iron-clad guarantee to the workers to whom they have been promised. Even the smallest attempts to alter future benefits—much less current ones—have been met with furious opposition. Workers’ representatives and also the plan managers themselves—like CalPERS—oppose changes. That opposition has been mostly successful. Governments at all levels are hamstrung between their duties to provide on-going services to their citizens and their ever-increasing financial obligations to pension funds. In the State of California, once one hires an employee, their retirement cannot be changed.

A typical city employee would receive a pension almost the same as his or her working salary if they participated for their whole career. In the case of many public safety employees, their retirement will last longer than their employment as they are fully vested in their retirement pensions by age 50 or 55. For so-called “miscellaneous” employees (all others) the retirement age is higher, usually 62. Nevertheless, the years in retirement can still equal or exceed those worked.

Discussions about pensions get emotional because we’re talking about people’s future and security. What gets lost in the arguments is this. The law and politics guarantee retirement pension benefits, but not the actual returns on investments. There is no separate investment market for pension funds. All investment pools, large and small, invest in the same markets. The myth is that pensions are safe. They are not. The difference is that taxpayers pick up the difference between reality and what politicians promised.

Unprecedented Bull Market

For the past ten years, since mid-2009, there has been an incredible bull market in stocks. CalPERS has posted many good returns during those years. However, Ventura’s pensions are underfunded by $215.1 million. For far too long, pension promises have been at levels far beyond what the real markets can provide.

What Can We Do To Fix Retirement Pensions?

Politicians have made many attempts to improve the current system, but none have addressed the problem in a meaningful way. CalPERS does offer one solution: Cities can buy out of the system—technically—but the costs are so enormous that no municipality can realistically consider that an option. It’s no accident, of course. CalPERS’ onerous payment demand to end participation is designed to be a straight-jacket. As of June 30, 2017, for the City of Ventura, the amount required to get out of CalPERS is $1.254 Billion.

League of California Cities and Government Finance Officers Association recommended actions to confront unsustainable pensions.

Reduce the unfunded liability by making annual catch-up payment even more than CalPERS instructs you to pay—if you can afford to pay more.
Raise taxes
Reduce services
Require voter approval of any pension obligation bond, or POB.

Pension Obligation Bonds Explained

A city issues a pension obligation bond to pay down the unfunded pension liability. The POB converts the pension liability into a fixed rate of return. There are considerable underwriting costs when issuing a POB. The city invests the money received from the bond into higher returning investments, usually in the stock market. The central idea is that the stock market investments will produce a higher return than the fixed interest rate on the bond, thereby earning money for the pension fund.

A POB creates debt to pay off debt. Such a bond is essentially a gamble with public money. Simi Valley is considering issuing a POB, and Ventura might follow suit if Simi Valley is successful.

The League of California Cities and Financial experts, including Government Finance Officers Association, strongly discourage local agencies from issuing Pension Obligation Bonds (POBs). This approach (going into debt to pay off debt) “only delays and compounds the inevitable financial impacts.”

These are terrible choices for the public.

What The City Council Might Do To Reform Retirement Pensions

There are two other choices for our City Council to consider if they have the political will to do anything about this crisis that will cripple the City of Ventura.

Make beneficiaries pay more. With the city covering 100 percent of the unfunded liability, the problem will continue to grow. There will be minimal reforms because the actuarial losses fall on the taxpayer. Capping the employer contribution at a fixed percentage of salary would cut pension costs for the city. As pension costs increase over the years, the employees will pay all the costs associated with the growth.
Change when retired city employees may begin collecting pensions. This alternative solution applies to new employees only. What if police and fire could fully vest their generous pensions by age 50 or 55, as they do now, but the payments did not start until age 65? Why would that help? The reason is that even if the city makes no further contributions, the fund will have ten more years to grow. At current official pension growth rates, that would more than double the value of that fund over those ten years. Also, the retirement payment period would be ten years shorter, given the same life expectancy. Such a system would still offer retirement security, but it would start at what most of us consider average retirement age.

Public sector employees may resist the changes but think about it. Private sector employees don’t get their full social security until 65 or even 67, depending the year they were born. Moreover, Social Security is only going to be one quarter to one-half of your working earnings.

Editor’s Comments

Even with an unprecedented bull market, Ventura’s unfunded pension liability grew over the past ten years. During such a period, one would expect the excess liability to at least shrink some.

Instead, the pension liability is growing faster than market returns can ever expect to make up. CalPERS annual demand will now permanently increase by about $2 million per year for the five to six years and then stay there. There is no assurance it will not increase even further in the future. Something has to change. Otherwise, the city will either cut back needed services, raise taxes, or both.

Past retirement pension negotiations were based on union bargaining and raw political power, creating a gap between what politicians promised and what cities realistically can pay. We offer some solutions, but it will take political will to bring the retirement benefits back to reality. Changing the system is the only way these promised benefits can be truly sustainable and dependable for retirees. It’s also the only way that taxpayers can afford to pay for them.

Demand Retirement Pension Reform

Below you’ll find the photos of our current City Council. Click on any Councilmember’s photo and you’ll open your email program ready to write directly to that Councilmember.

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

Irresponsible With Your Money On The Clean Power Alliance

July 30, 2019/in Newsletters/by VREG Editors

When in doubt, don’t.

—Benjamin Franklin

Thank the Councilmembers Cheryl Heitmann, Christy Weir, Lorrie Brown and Sofia Rubalcava for higher electrical costs, higher water, and wastewater rates. Also thank them for less police protection, fire safety and street paving, all so the City Council can save face and make all residents’ environmental champions.

Every citizen will now pay far more for electricity than if they stayed with Southern California Edison. The City Council had the option to keep your rates the same, but they didn’t. Too bad, because citizens will pay the increase and they will not get a vote.

When Choice Is No Choice At All

The City Council voted to enroll the entire city in the Clean Power Alliance program by a 4-2 vote on February 26th, 2018. During that meeting, our acting City Manager repeatedly advised the Council members they should wait because of financial uncertainties and undetermined costs.

They rejected the City Manager’s advice. Only Mayor Andrews and Councilman Tracy agreed with the City Manager’s recommendation and voted no. The other four members of the Council (Ms. Heitmann, Ms. Weir, Matt LaVere and Erik Nasarenko) committed the entire community to pay the additional costs for 100% for renewable solar energy.

In October 2018, the same four Council members (Ms. Heitmann, Ms. Weir, Mr. LaVere and Mr. Nasarenko) approved a contract with the Clean Power Alliance (CPA), enrolling every citizen and all city accounts in Ventura into the Clean Power CPA, in place of Southern California Edison. However, you were always free to reverse what the City Council decided if you took steps to opt-out. Otherwise, the change took effect in February 2019.

Remember, at the time the City Council voted to approve the Clean Power Alliance they didn’t know what it was going to cost. They committed the entire city to higher energy costs without knowing what those costs were going to be.

Who is the Clean Power Alliance?

The Clean Power Alliance is a 2-year-old electricity provider in Southern California. They claim to bring clean, renewable energy at competitive rates. They compete with Southern California Edison (SCE), which has been around for 111 years and has been continually working on renewable energy for over ten years.

The City Council bought into the Clean Power Alliance’s message. You were “automatically enrolled in 100% Green Power which provides 100% renewable energy,” allowing all “residents to be environmental champions, leading the way to a greener future.”

You’re In Unless You Opt-Out

You were in the Clean Power Alliance unless you opted out. To opt-out, you needed to go to cleanpoweralliance.org, or call 888-585-3788. Whichever method you chose required your last utility bill and your SCE account number. Without those, you got nowhere. If you opted-out by telephone, you spent considerable time listening to recordings, ad nauseam, extolling green power’s virtues.

Six Months Later, The City Manager Learns The CPA Power Costs Are Greater Than Expected

In June 2019, the circumstances changed with the Clean Power Alliance. The cost of “green energy” went up—a lot. City Manager, Alex McIntyre, requested that the Council opt-out of the CPA program and return to SCE for the “high user accounts” of the city (like the street lights). Residents would remain enrolled in the 100% increased renewable rate with the CPA.

The Clean Power Alliance Weighs Down Homeowner’s Bugdets

He recommended returning to SCE for at least a year until more was known. He demonstrated that the costs to large energy use accounts within the city, such as street lighting, water, and wastewater, are 20.8% greater than represented a year earlier. The total increase in costs for these high user accounts could be an additional $571,476.

After a lengthy discussion, filled with rampant confusion, misunderstanding, and punctuated with illogical statements, four members of the Council (Mses. Heitmann, Weir, Brown and Rubalcava) rejected the City Manager’s recommendation. These four voted that all of the smaller city accounts would remain in the CPA program at 100% green power. As for the six large City accounts, they voted to opt-out the street lighting account, and reduce the other large accounts to the 36% wind rate.

The result is that City government will be paying $228,086 more for electrical power through the CPA program than they would have paid through SCE. Of that number, water and wastewater account will be paying $157,148. What’s more, they didn’t know the actual costs when they voted.

As for what residents will pay, the City Council confirmed that they would stay in the program at the 100% rate.

That gives all residents “the opportunity to be environmental champions, leading the way to a greener future.”

What Impact Will The Clean Power Alliance Decision Have?

The costs of participating in the Clean Power Alliance are becoming more visible, and it’s hurting the city. Southern California Edison increased its rates to the CPA, who is now passing those costs on to Ventura. The timing of the rate increase pressured the City Council into making a rushed, imprudent fiscal decision.

In the 11th hour, our solar power provider was now going to substitute wind power for solar and presented a $228,086 rate increase to power city departments. All of this came on the same evening that the City Council gave final approval to the 2019-2020 budget. Now this $228,086 increase, at a minimum, will shortchange police, fire and street paving, all so the city can have wind power.

Police, Fire and Street Paving Gets Shorted

Councilman Jim Friedman got it right when he voted no. When he expressed that, “The budget is $3.5 million in the red now, and this just makes it worse.” By voting to pay more to the CPA—money the city does not have—city services will suffer. Your streets won’t get paved. The city doesn’t hire a police officer. Your water and wastewater rates increase. The police and fire departments don’t respond in time to save a life. If any of these things happen, you only need to look to four members of our City council for their budget decisions. (Mses. Heitmann, Weir, Brown and Rubalcava)

The city staff recommended opting out for one year until Ventura got a clearer understanding of what their fiduciary responsibilities would be. The City Manager recommended the City Council opt-out for one year. Councilmembers Heitmann, Weir, Brown and Rubalcava disregarded the staff’s recommendation to protect past votes to join the Clean Power Alliance. They voted to “save face” over the public’s interest.

Making Your Decisions for You

The City Council chose your electricity provider for you. In so doing, they shifted the burden of “Green Power” to every homeowner in the city. So, if you did not opt-out, you’ll pay higher electricity bills. We should resent the City Council forcing this upon the community. The CPA program should be a decision for each citizen to make. In this case, the government effectively enrolled everyone automatically without any consent from the citizens who will be paying the bill.

Four members of the City Council (Heitmann, Weir, Brown and Rubalcava) were caught up in the “Save the Planet” message and hysteria. They believed that recyclable energy is the better choice, regardless of the cost. The Council should have taken a more cautious approach with an unproven, start-up company offering power whose benefits and costs are unknown. Instead, they let ideology cloud their decision instead of being fiscally prudent with taxpayer money.

Editor’s Comments

Should Ventura be concerned about a City Council that doesn’t plan, and spends money they don’t have? So far, they act with an attitude that ‘we’ll find the money somewhere.’ Obviously not from their pockets.

The highway to Hell is paved with good intentions. The City Council would do well to remember that. The city’s finances can withstand fiscal irresponsibility because of the Council’s financial ignorance only for so long. A day of reckoning is coming. Ventura faces six years of negative budgets. Perhaps that day is sooner than the City Council realizes.

As citizens, we must ask, “How long will we live with the Council’s bad financial decisions? For how long will we accept Councilmembers with political agendas that disregard city staff recommendations to make a ‘statement’?” Should Ventura be concerned about a City Council that doesn’t plan and spends money it doesn’t have?

Carefully examine your expenses and your beliefs to determine if the Clean Power Alliance is for you. If not, opt-out.

Moreover, when you go to the polls next November, do not reelect Councilmembers who exhibit no fiduciary responsibility with your money.

It’s time we examine our City Council’s performance and ask why they do the things they do. If we don’t diligently watch our money now, there may not be any money to watch in the future.

2022 Addendum

The Clean Power Alliance published its annual price comparison to Southern California Edison. The CPA costs more for electricity at every level of clean energy than SCE for a typical Ventura resident. If you’re concerned about saving money, opt out of the CPA using the contact information above.

Demand More Fiscal Responsibility On The Clean Power Alliance

Below you’ll find the photos of our current City Council. Click on any Councilmember’s photo and you’ll open your email program ready to write directly to that Councilmember.

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

How The Right Steps In The 2019 Budget Make Your Tomorrow Better

June 18, 2019/in Newsletters/by VREG Editors

“Giving money and power to government is like giving whiskey and car keys to teenage boys.”

—P.J. O’Rourke

Ventura faces severe revenue shortfalls in six of the next seven years, the size of those during The Great Recession. Ventura is on pace to lose over $9.07 million over the next six years. You should be concerned about the financial conditions in the City of Ventura, and you should also know this budgetary crisis is avoidable if the City Council acts this year.

Ventura’s General Fund Financial Outlook For The Next 10 Years

Ventura city staff calculate the city’s revenue and expenses for the next ten years [see graphic]. Costs will exceed income for six consecutive years beginning in the fiscal year 2020-2021—that’s next year.

Pensions are the main reason for the rise in expenditures. Annual pension costs will climb to $31.48 million from $19.71 million by the fiscal year 2025-2026. That’s an $11.63 million increase. The city projects property and sales taxes to increase by only $10.6 million over the same period. Not a rosy outlook.

Next year (the fiscal year 2020-2021), Ventura faces a $2.52 million deficit because of the $2.17 million in rising pension costs.

The city staff estimations are optimistic. They do not factor in a recession, which some believe is imminent. If a recession comes, people will lose jobs. Also, if a recession hits, property and sales tax revenues will suffer and projected losses may be even worse. What’s more, the city plans to add no money to reserves in the fiscal year 2019-2020. Current reserve levels for the City of Ventura will keep the city government running for only 45 days.

Wasn’t Measure O supposed To Save The Budget?

Measure O passed three years ago and will continue for the next 22 years. It brings in $10.8 million in additional sales tax revenue each year. Still, it isn’t enough to cover the projected shortfalls. Why is that?

There are several reasons why Measure O can’t save the city’s budget. First, there is no consensus among the City Councilmembers about how to use Measure O money. Alex McIntyre, Ventura’s new City Manager, asked all seven Councilmembers individually how they would spend it. All seven Councilmembers gave differing opinions on how to use the Measure O taxes. Without clear direction, it’s difficult for the City Manager to focus the city staff on what’s most important for our city. Confusion over Measure O is one example of how the City Council is dysfunctional on the budget’s priorities.

A second problem is how special interest groups lined up to get their share of Measure O. At the May 20^th City Council meeting, Councilmembers Lorrie Brown, Jim Friedman and Mayor Matt LaVere tried to move funds from Measure O to the General Fund for Fire Station No. 4. The Star report said the Fire Department union members felt insecure (sic) about Station No. 4 funding coming out of a temporary tax fund. (The tax lasts for 25 years)

In 2016, The City Council sold Measure O to voters with the promise that Fire Station No. 4 would remain open with its funds. Voters agreed to the idea of a temporary 25-year tax. VFD is now trying to persuade the City Council that when Measure O expires, there may not be funding for Fire Station No. 4. They fearmonger that response times to calls will increase, and lives could be lost. A 4-3 vote defeated the motion.

While this City Council takes precious time debating moving funds from one column to another, the growing unfunded pension obligations put pressure on the entire city budget, even with Measure O.

The Canaries In The Coal Mine

Economic disasters are all around us. There is no reason to think that Ventura is immune to them. The City of Oxnard is preparing to lay off hundreds of employees. They also plan to close a fire station and reduce the number of fire personnel available to respond to emergencies. The Oxnard City Manager says, “We are down to bare bones.” What’s happening in Oxnard is a preview of what could happen in Ventura unless the City Council acts quickly.

Ventura County Medical Center is losing over $40 million per year. That adds more unemployment to our community. With the City of Ventura own forecast of financial shortfalls, the City Council would do well not to ignore the economic disaster warning like ‘a canary in a coal mine.’

How Do We Fix The Budget?

The budgetary crisis is entirely avoidable if the City Council acts now. The solutions are simple, but they are not easy. It requires significant political will and resolve.

Improve The Budgeting Process

Currently, the City Council approves the city’s annual budget one year at a time. It doesn’t consider subsequent years’ financial demands. Given that the 10- year forecast shows losses for the next six years’ budgets, to ignore the next six years will be pushing the problem “down the road.”

Now is the time to change this systemic shortsightedness. City Councilmembers have the opportunity to discuss budgeting on at least a 3-year basis, not one year at a time.

Not Filling All Open Positions In City Hall

To balance the budget over the next six years, the city staff has two potential solutions. They can increase revenue through taxes and fees or reduce expenses. Since it’s not easy or popular to raise taxes and fees, the alternative is to cut costs.

The single largest expense category is city employees. Cutting staff is the obvious choice to reduce expenses. To avoid the unpopular cutting of current employees, the City Council can take a less unpleasant path and cut positions in the budget that the city never filled.

There are currently sixty unfilled positions at City Hall. If each vacant position costs the city $100,000 per person (salary, overtime, retirement and benefits), the cost to budget for these open positions adds to the projected deficit (losses).

If the city reduces the unfilled positions to thirty instead of sixty, the savings to Ventura would be $3 million per year. A $3 million reduction in expenses will balance the budgets for the next six years.

This decision puts the City Council on the horns of a dilemma. Should they hire all sixty positions now and later fire employees during the budget shortfalls? Alternatively, should they hire only thirty people knowing they can add personnel if the city’s economic situation improves? Eliminating unfilled staff positions is less disruptive to city government than laying people off.

Economic Development

An alternative toward improving the budget is to attract new or expanding businesses to Ventura. Several Councilmembers understand this and agree. More business and local jobs are the best solution for filling the budgetary shortfalls. More jobs generate more sales tax, encourage community spending and increase property values. Higher property values increase property taxes and reduce blight.

Imagine the stimulus to the community of filling the old Star Free-Press building or the Toys-R-Us location would have.

The city has already taken the first step in this direction. City Manager, Alex McIntyre, has moved the Economic Development division under the City Manager from under Community Development. Elevating the reporting of this department to the City Manager signals the increased importance economic development has for the city.

Empower The Economic Development Manager

Another simple step the city could take would be to empower the Economic Development Manager (EDM). The EDM must have readily available an inventory of all commercial locations, complete with square footage, zoning, parking, pricing, and a list of commercial real estate agents and contact information.

The City Council must be ready to provide incentives to new or expanding businesses. The incentives must include fee reductions and process simplification to entice the companies. One such motivator must be a single contact within the city who will guide the relocation process through the bureaucracy.

Finally, the EDM must identify and target new commercial business to locate in Ventura.

Each of these positive steps toward economic development has one drawback. They are long-term solutions. None of them will happen quickly enough to fix a budget by next year.

Streamline the City Hall Experience

The city has started reorganizing boards and commissions that oversee Planning, Design Review, Historic Preservation, and other committees filled by residents appointed by the City Council. While this is a good start, it must go further.

Reducing boards and commissions saves staff time in preparing and attending meetings. The staff attends about 20 meetings a month. Fewer meetings will allow more time for the employees to better supervise operations in planning, design review, code enforcement, etc.

The city must look at other ways to reduce staff time in other duties—especially if the city hires only thirty of the sixty unfilled positions. All staff operations should be scrutinized to end obsolete or redundant activities.

Revamp Ventura Fire Department

Now is a good time to modernize the fire department. Ventura Fire operates in much the same way it did 100 years ago except the needs are far different:

Building codes are stricter making fires less frequent
More buildings have sprinkler systems
Over 75% of calls are for paramedics

Each fire station has paramedics on duty to serve those calls. In addition to Ventura Fire, each medical emergency requires an ambulance from a private company in case a victim needs transporting to the hospital. Rolling a fire truck plus an ambulance seems like duplicated efforts.

Any change to the Fire Department would likely be unpopular with the public. That makes it a subject considered by Councilmembers, to be too controversial to discuss. The fire department union will become protective of their fellow firefighters and will want to preserve the status quo.

As they have in the past, the unions will apply pressure to the Council. Since four of the seven elected Councilmembers received campaign contributions from Ventura Fire in their last election, the politicians will likely concede as they have in the past. Ventura Fire Department needs reorganizing. Now is the ideal time to do it.

Editor’s Comments

The community will not support another tax rate increase. Pension costs already absorbed the entire $10.8 million raised by Measure. Still, citizens ask why the city doesn’t repair their streets and sidewalks. We can’t hope for an economic miracle to increase revenue, so the city must take steps to curb expenses. Ventura must:

Lower expenses by not filling all open positions at City Hall. Add those costs back into the budget
Design and target new commercial businesses to locate in Ventura
Offer incentives and fee reductions to bring more jobs to Ventura
Streamline the City Hall process and operations to reduce staff time. It will accelerate the processing time for building and licenses
Streamline medical response procedures within Ventura Fire. Find ways to reduce fire department costs for those calls. Dispatching a private ambulance and fire trucks with paramedics every time is expensive
Hold in-depth discussions at the City Council to expand budgeting to a 3-year basis, not one year at a time

INSIST THE CITY COUNCIL MODERNIZES THE BUDGET PROCESS

Below you’ll find the photos of our current City Council. Click on any Councilmember’s photo and you’ll open your email program ready to write directly to that Councilmember.

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

Update On the Measure O Citizens’ Tax Oversight Committee

September 13, 2017/in Newsletters/by VREG Editors

“Reason is, And Ought Only To Be The Slave Of Our Passions”

—David Hume

EARLY SIGNS OF A TRAIN WRECK

The city’s Measure O Oversight Committee has shown signs of being inadequately trained and poorly prepared for the job they were appointed to do. This is not the fault of the committee members themselves but a reflection of the City Council and City Staff.

The Measure O Citizens Oversight Committee conducted their third public meeting on August 10,2017 at the Sanjon Maintenance Yard (Ventura Water Department). Each of the three meetings has been at a different location. They are not televised or recorded in any manner. Few members of the public attend.

This new tax oversight committee, appointed following the sales tax increase approved by the voters in the last election, serves ostensibly to provide recommendations to the City Council on how the new $10 million, in new sales tax money should,or presumably, not be spent.

The City of Ventura Finance Department did a yeoman’s job in attempting to provide the committee with a draft of proposed future spending of Measure O funds for the next 5 years. It was a suffocating spreadsheet which required detailed comments and direction on the evening of the meeting. If the purpose was to provide clear, informed and relevant information for the public and the committee as a basis for making decisions on how to spend the new tax money, it fell short.

The City Finance Department made a good effort to explain everything but the complexity of the subject required more than a brief meeting.

SPENDING PROJECTED TO EXCEED INCOME

For most citizens seeing this spreadsheet for the first time, be prepared to understand that
there is a projected deficit by the second year, and each year after that. See this detailed projection here.

Measure O overspends by $1.76 million in the second year

At first glance, the Measure O funding will be overspent by $1.761m in the second year. By the fiscal year 2022, the City of Ventura will be over budget (spending more than they expect to receive) by $3.732m. We must all keep in mind that this is a draft worksheet for discussion purposes only; but even so, to learn at the outset that the head of our finance department predicts a deficit in just 5 years for a new tax that will last 25 years does not bode well.

What is clear however is that the Committee is being asked to approve thisprojection, and that a very large percentage of those projections are for long term contracts for public safety and city personnel. History has demonstrated quite clearly that those “contracts” are never reduced thus we can expect more and more of this new tax money to be consumed for personnel and benefits. Everything else – roads etc. – will be low on the list of priorities.

There were two things that the Measure O Committee needed to concentrate on. One was that the only annual budget recommendation that really needed to be discussed was for fiscal year 2018. The second was that they were only seeing a small percentage of the financial picture. The general budget line items were not presented, thus there was no way for anybody to perform an analysis of where money “should” or “should not” be spent, or to determine if the general budget had been modified and then back filled with the new tax money. Without a comparison to the general budget, it is impossible to perform that task.

For example, by not having the general budget for a specific department, side by side to that departments proposed Measure O Funding, the Measure O committee had no way to determine if say $700,000 for sidewalks made sense because they have no idea if Public Works is spending another $1.0m or zero out of the General Fund Budget for sidewalks.

CITY DEPARTMENT PRESENTATIONS

Each of the three sought the Measure O Oversight Committee’s approval to present their spending to the City Council. Public Works Director, Tulson Clifford, presented his department’s request for $6.1 million in 2017-2018. Police Chief, Ken Corney, presented his department’s request for hiring new officers in time to enter them into the training academy in October 2017. And, Nancy O’Connor, Parks Director, presented her department’s request.

Police Chief Ken Corney’s request was approved by the Oversight Committee

There were only 5 of the 7 Committee members present and this would present a potential problem for the Measure O Committee. After about 2 hours, the Committee Chair person suggested that no recommendations be made until all 7 committee members were in attendance. This was after hearing Chief Corney explained that timing was crucial and the funding for the Neighbor Drug & Crime Prevention required the hiring and training of 7 new officers at the police academy in October. .

If it had not been for Committee Board Member Kristopher Hansen’s quick thinking and motion, to recommend to City Council the Police Chief’s request for funds, the outcome could have been detrimental to the Ventura citizens. Measure O Citizens Committee did their job and funds were approved for the police department and postponed for all other requests.

EDITORS COMMENT

To assist this new committee in their task and to maintain transparency for all citizens in the community VREG makes the following suggestions and recommendations:

Have the entire department’s general funds budgets side by side the Measure O budget.
The Department Heads provide a detailed cost breakdown on how the funds will be spent which matches the line items on the general budget.
Discussing department spending five years is helpful but misleading. There are too many variables to factor over that period, such as personnel, maintenance costs, contracts, natural resources, safety, technology and public demand.
Increase and improve the training for current and future committee members. Be satisfied they understand their roles,duties and responsibilities.
Be sure they know Parliamentary procedures, so they help, not hinder, city government such as what constitutes a quorum to act.
As needed, provide in-meeting guidance and direction from city officials whenthe committee appears confused or aimless.
Hold the meetings in places that permit cable TV coverage. Transparency isimportant to Measure O. Thus far, it has not been transparentI nhibits transparency and confuses the public on where to attend meetings.
Hold the meetings in the same facility. Moving from location to location

Addendum

THE STAFF PRESENTATION/REQUESTS FOR FUNDS

To help you better understand, we have included both Public Works and the Parks and Recreation presentations so you may judge for yourself that there is no correlation to the Measure O budget requests on a line by line analysis to the general budget. Here is a verbatim of what they were told:

PUBLIC WORKS

The Public Works Department is charged with designing, building, operating and
maintaining the City’s infrastructure including:

75 buildings;• 700 lane miles of pavement and adjacent sidewalks;
138 traffic signals;• 26 miles of alleys;
22 parking lots; and
An extensive storm drain system (110 miles of storm drain lines, 2,400 storm drain inlets, and 9 miles of drainage ditches).

Some of this infrastructure was installed over 100 years ago, and much of it has
reached or exceeded its useful life. The following infrastructure improvements are needed to protect the environment for the safety, enjoyment and prosperity of future generations:

Improve streets, sidewalks, alleys, and provide safe facilities for pedestrians and cyclists – $191 million;
Clean and protect the beaches with storm water and drainage repairs – $34 million;• Protect and seismically improve bridges $27 million and
Repair public buildings and facilities $27 million.

Public Works has reviewed the infrastructure needs and prioritized projects based on existing conditions, risk, liability, and other factors. While we recognize that not all of these improvements can be made in year one, this proposal contributes to the long-term sustainability and resilience of Ventura’s infrastructure. The proposed Measure O budget for Public Works projects in FY 2017-18 is $6.1 million. These projects include pavement overlay on Telegraph Road (Main St. to N. Mills Dr.) and replacing the storm drain at Harbor Blvd. and Olivas Dr.

PARKS, RECREATION AND COMMUNITY PRESENTATION

PRCP focus for Measure O will be aimed at delivery of service to activities that “reduce blight, assist the homeless, and maintain or improve existing facilities and infrastructure”.

Safe and Clean. Expansion of current program allows for additional staff to respond to homeless debris cleanup as well as general trash, debris, weeds, in right of ways, sidewalks and roads.

Urban Forestry Tree Maintenance. This proposal provides resources to prune 10,000 trees each year, in addition to the approximately 6500 trees that are currently trimmed annually. Expected outcomes will allow for all city maintained trees to be on a 3 to 5 year pruning cycle (species dependent). The current pruning cycle is 7-9 years.

Median Maintenance. Current maintenance of medians is approximately once per month, medians only, minimal sidewalk maintenance at best. Expanded funding of the program will allow median and sidewalk maintenance on main arterials to be performed twice per month.

Aquatic Center Maintenance. The Aquatic Center, at Community Park, opened in 2002 and most of the hard components of the center-pumps, motors, tanks, and the pools themselves, have a finite useful life, and need regular maintenance and replacement. There is no sinking fund associated with the pools and adding ongoing funding allows optimal maintenance, and helps keep the pools operating safely.

Preserving Park and Recreational Facilities. Community Park has one entrance, at Kimball Road. The master plan for the park includes an additional entrance from Telephone Road, at Ramelli Avenue. Hundreds of people enjoy Community Park daily, and on weekend the number of visitors is oftentimes in the thousands. A second entrance improves access to the park, and allows for larger softball, soccer, and swimming events.

Restroom at Arroyo Verde. Many of the park restrooms are closed on a regular basis due to issues with cleanliness and safety. The City of Portland, Oregon developed a stainless-steel restroom. These restrooms have been installed in their downtown areas, and are frequented by tourists and the homeless. The restroom’s main features are fabrication-alone piece, ease of cleaning, and drastically reduced cost due to prefabrication.

Have An Opinion? Share It With A City Councilmember.

Click on the photo of a Councilmember to send him or her a direct email.

Erik Nasarenko, Mayor		Neal Andrews, Deputy Mayor
Cheryl Heitmann		Matt LaVere
Jim Monahan		Mike Tracy
Christy Weir

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.

Editors:

R. Alviani K. Corse T. Cook B. Frank
J. Tingstrom R. McCord S. Doll C. Kistner

Pension Liabilities Threaten Ventura’s Financial Health

February 1, 2015/in Newsletters/by VREG Editors

John F. Kennedy on Fiscal Responsibility

“When written in Chinese, the word ‘crisis’ is composed of two characters. One represents danger, the other represents opportunity.” —John F. Kennedy

VENTURA’S FINANCES – HEALTHY, OR NOT ?

At the Ventura City Council meeting on February 23, 2015, our Mayor will discuss The State of the City. It is to be expected that she will praise the accomplishments of the City, such as creation of a Water Commission to address water shortage issues and the City efforts to improve roads and basic infrastructure. The condition of City finances will also be a major subject, building on the Ventura County Star article, published on President’s Day, with the headline “City’s Financial Outlook Healthy”.

A candid discussion of the condition of City finances is to be welcomed, but it is not the rosy picture portrayed in the Star article. The Economic reality of the current public pension liabilities of the City of Ventura unfortunately is not receiving the attention it demands when determining our financial outlook, nor is the impact of escalating payments to CALPERS and the drain it will have on the General Fund and City services in the next 5 years getting noticed.

A. VENTURA UNFUNDED PENSION OBLIGATIONS TRIPLE

In the fall of each year CALPERS provides financial and actuarial reports for the SAFETY PLAN OF THE CITY OF SAN BUENAVENTURA (police and fire) and MISCELLANEOUS PLAN (all other employees). The latest report, dated October, 2014, provides a valuation of assets and liability as of June 30, 2014.

The combined City pension assets have a present value of $191,329,875. and we owe $353,756,578. There is no money to pay the $157,993, 381 shortfall. The official calculations are based upon an assumption, projected over the actuarial life of the union participants, that CALPERS, as our pension fund administrator, will achieve an investment return of 7.5%.

What this report does not discuss in direct terms is the 50% loss our City incurred during the 2008 depression, together with the other 1600 local government agencies funds that they manage. That money has not been replaced. What CALPERS wants to emphasize in their report is the 18% (not net of costs) return that they received ending June 30, 2013. This is a short term gain only.

For the investment forecast CALPERS uses a rate of 7.5%. However, when CALPERS illustrates their Hypothetical Termination Liability calculations on page 28 of the report, it uses a far different and lower discount/investment rate of 3.72% instead of the 7.5% rate of return. In that event we owe $488,961,724.

In reality, in early in 2014, CALPERS admitted that it is still underfunded by 50%. They report earnings of 18.5% last year, but a study has reported their actual earned average of 3.41% for five years, 5.36% for ten years, 6.97% for 15 years, and 8.38% for 20 years.

B. HISTORICAL PERSPECTIVE

In August 2008, the editors of this newsletter published an analysis of the unfunded pension obligations of Ventura titled IN THE SHADOW OF VALLEJO. We warned against the increase of the firefighters’ pension benefits by 33% (from 2% at age 55 to 3% at age and urged the Council not to make the increase, and to require all other employees to contribute at least 5% to 10% toward their pensions.

We provided extracts from a CALPERS report of the time.

Funded Status–June 30, 2008	Police/Fire	Misc. Plan
Present value of projected benefits	$270,877,057	205,128,033
Entry Age Normal Accrued Liability	$233,938,241	$167,837,616
Actuarial Value of Assets	$177,314,177	$157,529,148
Unfunded Liability	$46,624,064	$10,308,468

“I do not know where we are going to get the money.”

The vote was 4 to 3 in favor. Voting against the increase were then Mayor Weir and Councilmen Andrews and Morehouse. Councilman Morehouse’s comments at the time were prophetic. “I do not know where we are going to get the money”.

In January 2011, VREG newsletter again visited the pension issues because the City Council was considering the renewal of the labor contracts with the employees in the City. The proposal was to require the employees to contribute 4.5% of the CALPERS pension costs. This VREG urged the Council to require greater contributions from the employees. The article was titled HMS TITANIC [Moving Deck Chairs to Avoid a Disaster].

The City Council vote was 5-2 in favor of the agreements (which included a requirement that employees contribute 4.5%). Councilman Andrews and Councilwoman Weir voted against approval. The decision of the other five—Brennan, Fulton, Monahan, Morehouse and Tracy—was in favor.

Councilwoman Christy Weir rejected the proposal and stating “Fiscally, the city needs more than this right now.” Council Member Neil Andrews concurred stating, “The agreements simply don’t go far enough.”

“The agreements simply don’t go far enough.”

C. AN ESCALATING PAYROLL CONTRIBUTION RATE THREATENS FINANCIAL HEALTH

Today the City of Ventura owes in excess of $157,993,381. It will only increase and the drain on the General Fund will likewise increase because the required employer contribution rate for police and fire for example must be paid yearly in addition to their pay and medical costs. Here are the mandated and projected rates from CALPERS.

FISCAL YEAR           EMPLOYER CONTRIBUTION RATE (Police & Fire only)
2011/2012                   35.190%                      2012/2013                   36.4%
2013/2014                   40.6%                          2014/2015                   44.225%
2015/2016                   45.598%                      2016-2017                   50.6%
2018-2019                   52.5%                          2019/2020                   54.5%
2020/2021                   54.6%

BANKRUPTCY DEVELOPMENTS

Ventura’s Financial Health Threatened By Pension Liabiliteis

The cities of Stockton and Vallejo were forced to file chapter 9 bankruptcy proceedings. The cities asked their creditors to take haircuts, but not CALPERS. The cities insisted that the public employee unions were exempt and entitled by law to100% on the dollar. The Federal Bankruptcy Court ruled otherwise in January, 2015.

CALPERS argued that the California Constitution guaranteed the union contracts and thereby pension benefits from cuts and/or that they enjoyed sovereign immunity and police powers as an arm of the state and/or that they have a lien on municipal assets. In January 2015, the Federal Bankruptcy Court effectively threw them out of court saying: It is doubtful that CALPERS even has standing. He writes “It does not bear financial risk from reductions by the City in its funding payments because state law requires CALPERS to pass along the reductions to pensioners in the form of reduced pensions”.

Judge Klein further stated: “CALPERS has bullied its way about in this case with an iron fist” and “that their arguments are constitutionally infirm in the face of the exclusive power of Congress to enact uniform laws on the subject of bankruptcy…”.

The impact of this decision is that CALPERS cannot stop cities from modifying pensions.

EDITORS COMMENT:

The direction that Ventura is heading is insolvency and the idea that employee pensions are guaranteed and protected is wrong. Unless the City Council take steps to force public employees to pay a greater portion of their retirement and stop increasing the annual percentage of the general budget toward retirement and benefits, Ventura will collapse.

R. Alviani K. Corse T. Cook B. Berry
J. Tingstrom R. McCord S. Doll

For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.