“Government, in its best state, is but a necessary evil, in its worst state an intolerable one” —THOMAS PAINE
SUMMARY UPDATE
In previous editions we treated issues that are important to our community. We now provide updates on those issues as they have evolved and as information has become available from our city government:
(A) The 911 Fee
The Howard Jarvis Taxpayers Association (HJTA) has undertaken the task of prosecuting this action on behalf of several citizens that have volunteered to be named as plaintiffs. So, what is the status?
Their lawyers are preparing claims for refunds, which must then be rejected by the City before a lawsuit can be filed. It is clear that a suit is soon to be filed. When it is over attorney’s fees and costs will be requested. California Code of Civil Procedure § 1021.5 provides that a court may award attorneys’ fees to a successful party against one or more opposing parties in any action which has resulted in a significant benefit to the general public. A finding that the 911 fee is in fact a tax invalidates the 911 ordinance enacted by the Ventura City Council because a 2/3 vote of the voters is required. Sadly the citizens of this community will pay again for this misadventure
(B) CITY GOVERNMENT IMPOSES MORE INCREASED FEES
[Economics 101]
Economic stress brings legislators and government employees out of their offices looking for more revenue. The State is broke and the Feds are oiling the money presses. All a result of colossal malfeasance and incompetence at all levels of government. We can also add a good measure of greed for our fine friends on Wall Street. Will our governments stop, take a breath and get back to basic economic reality? Every family and every business know that given such circumstances you have two choices – seek more income or decrease costs. The narrow paradigm for politicians is that they always see new taxes and fees on the citizens as the principal, if not the only solution. Can’t blame them entirely for this because voters insist on more government for less, and voters continue to approve massive bond measures that draw on the treasury we don’t have. The problem with this approach is that the only ones who have money to tax are those that did not spend and live foolishly in the first instance and who in the final analysis are those that create the jobs for society.
In our last three monthlies we reported to you that the City Council is seeking to increase fees to raise another $2.6 million dollars, and that at the early June Council meeting the issue was tabled when Councilmen Fulton and Summers commented that there had not been sufficient time for the community to address this issue. Another important factor was the inability of anyone to obtain and read the MAXIMUS REPORT(s) (the experts hired by the City), which was designed to be the “legal basis” for the fee increases in the first place. This was perplexing because the Council, adopting an attitude of “don’t confuse me with facts”, increased fees in 2006 and 2007. So good reader you ask yourself how an elected official can vote to increase fees based on a report that they don’t have?
In July, VREG received the MAXIMUS 2004 AND 2007 reports. These reports provide conclusions and some basic financial data that led to those conclusions, but not the “Cost Plan”. That plan is not available.
Officials at the City have been most cooperative and helpful. They too want accurate data so that a logical decision can be made. If increased fees are justified then increase them, but let’s not play games and pretend we are out 2.6 million dollars that City government was never entitled to in the first place. Councilman Fulton wants to hurry into this and make a decision. Now that we finally have all eleven (11) appendices to the MAXIMUS Report he may want to so some reading, deliberate and wait to make sure that when a decision is made it is truly “legally defensible”.
Another 911 fiasco in the making?
(c) THE FIREFIGHTER PENSION
[CITY GOVERNMENT NEGOTIATIONS GONE AWRY]
In a vote of 4 to 3 the council approved the Memorandum of Agreement and the new pension contract with the firefighters of this city giving them a pension equal to 3% of their highest salary times the number of years in service plus all medical, dental. The yeas were Councilmen Fulton, Brennan, Summers and Monahan. The neighs were Mayor Weir, Councilmen Andrews and Morehouse. It should be of grave concern to all when one councilman says, before he cast his “NO” vote – “I HAVE GRAVE CONCERNS TO COMMIT WHEN WE DON’T KNOW WHERE THE FUNDS WILL COME FROM”.
In our August letter we posed a hypothetical retirement scenario – a fireman goes to work for the department at age 20, works 35 years and retires at the age of 55 earning a salary of $100,000 per year. The proposal is that he will receive 3% of his salary in his last year of employment multiplied by the number of years of service. So he will retire earning $105,000. [$100,000 x 3% = $3,000 x. 35 = $105,000].
Since that publication one Councilman has been very kind to point out that we need to make some “minor corrections”.
We quote:
In the example it indicates that an employee has the ability to retire and receive 105% of their annual salary. Regardless of the time of service and age at retirement, the program is capped at 90% of the eligible salary. The example also includes add-back for accrued sick leave and vacation. The City’s formula does not include any add backs, the formula uses only the base salary. It is the County’s formula that includes add backs…(in addition)…unfortunately the assumption of a 30-year future obligation per employee is incorrect, the average life expectancy of a public safety employee is 7 years from retirement”. We don’t know what source Councilman Summers is using for this surprising statistical justification for his supportive vote.
We thank Councilman Ed Summers for his thoughtful letter and correction, but when he and others argued that “the increase was only 1%, it in fact was an increase from 2% to 3%, which is a 33 1/3% increase in the retirement plan.
Our hypothetical 55 year old fireman will now only get $105,000 with no add backs to the base salary calculations. As for his 7-year life expectancy, we await the data from the Councilman and pray that our fireman lives longer than that.
Counter point– the judiciary and life insurance companies use annuity tables that tell us that our hypothetical firefighter at age 55 will live 23.7 more years so will still be kicking at age 78.7. That calculates to $8,263,500 over the life span of this firefighter.
The question to our citizenry remains. How much do we as citizens want to pay for police and fire?
The reason given for not being able to fill open vacancies is that Ventura requires all firefighter to be trained paramedics. By raising the bar, is it too expensive and causing Ventura to have a “garage full of Cadillac’s when a Ford will do? Do we want all of our firemen to be trained paramedics? Please send your answers to us.
[Consider: you are now paying 51 cents for police and fire. That leaves 49 cents for general government purposes. However, it is estimated that 70% of that (34 cents) is spent on people. That leaves us with 15 cents for all other purposes]
(D) RATE INCREASE FOR WATER AND SEWER
Enclosed with your last bill was a notice that you will be paying more unless you object by SEPTEMBER 22, 2008. We reported the proposal in the last letter. As an ordinance the City Council approved the first reading. The final reading and the final step for approval was set for October 6, 2008.
The City Clerk only received 353 letters ostensibly objecting to the increase.
Critics of this process protest the reverse approval process that is used in the City. Good arguments can be made that no fees should be imposed unless a majority of the water users agree to a 14% increase for water rates. Is it good public policy to increase fees and taxes based upon sending out a notice and requiring a written reply to avoid a new increase ? As it stands the fee is increased unless a large percentage protest. Can silence be construed as acceptance of this 14% increase of water rate? Is it good public policy to increase fees and taxes based upon sending out a notice that requires a written reply to avoid the increase? You be the judge.
(E) THE “CRIME FREE RENTAL HOUSING PROGRAM”
The City Council has asked its staff to appear at the council meeting on October 20, 2008, to consider implementation of a new program called the ”Crime Free Rental Housing Program”. That hearing has been postponed to November 3, 2008.
The original ordinance that was requested by the Ventura City Council, and which was reported to you in the last news letter, may be abandoned but apparently will morph into something we know not what.
The individual charged with developing this ordinance, at the request of the Council, Andrew Stuffler, has compiled data on this proposal, and is reaching out to interest groups to determine the viability of this program. The data he developed reveals that 93% of the rental property owners are doing it right and that 7% are the problem, but 7 % of what problem? Further analysis indicates that of this 7% all but 10% of those complaints relate to issues unrelated to code enforcement issues, such as dog barking, parking, loud party etc. So a major program is being developed with major fees to deal with a problem that involve less than 0.7% of the rental property owners.
Draw your own conclusions. If you want to contact the working group here are their addresses:
RENTAL HOUSING PRESERVATION PROGRAM WORKING GROUP MEETING
THE STATE OF THE CITY TREASURY
Early in 2008, a task force was created concerning the City budget for the 2007-2008 fiscal year. This was a good effort. As a result $4 million dollars were saved through cost cutting. The process involved income projections that required a reduction of $4 million in expenses to avoid going into red ink territory. This worked well but the real unknown was what the income would really total on June 30, 2008 [fiscal year is July 1 to June 30]
In the Budget Summary Overview published by the City Manger the following comment was made concerning the reliability of the income stream that could be expected for 200708. Property taxes were forecasted to increase by 5%, sales tax to increase by 5% [from sale of autos, dept. stores and restaurants] and “all other taxes … by 4% due to a healthier economy”. What actually happened was that property taxes were up by 4.3%, sales taxes down by 5% and other taxes up by 1.6%. Well so much for projections and the predictions of the experts hired by the City – MuniServices !
Notwithstanding the failure of the “healthier economy” projection our City money mangers have done well under difficult circumstances. Unlike Sacramento or Washington costs have been adjusted by the Council to stay within our income stream (what a refreshing concept). A few facts for you to consider:
- Total revenue for 2007-08 was $88,728,000. Total expenses $88,392,735. This left $335,730 in the bank.
- City portfolio of investments totals $160 million in the bank and earning interest. Included in this number is $35 million in corporate paper. Unfortunately $5 million was invested in WAMU and $5 million in Lehman Bros. This may prove to be a loss but in this economy a loss of 6% is an accomplishment.
- For FY 2008-09 income projections are on track. Expenses are below projected expenses and the income projection is accurate for the period of July 1 through September 30th. A copy of the income/expense graph is attached.
- The $5 million set aside by the Council to invest for the purpose of attracting new start up businesses is pretty much intact. Called “growth funding” $3 million was segregated for Southern California businesses (Santa Barbara south to Camarillo). $600,000 has been requested from this fund. The other $2 million was allocated for Ventura business development. $400,000 was spent to create a business incubator (I think they mean offices and tenant improvements) in the building behind City Hall. We have $4 million left in the bank.
EDITORS’ COMMENTS
This is our community and we should have a voice in what happens in our community, but there is great mistrust between the citizenry, those elected to office and the office of the City Manager. The citizens demand that government do its job based on the revenues from existing taxes, that they manage costs and stay within a budget. The City Council on the other hand makes decisions seeking more money for more programs regardless of the taxpayers’ wishes.
How often we have heard one Councilman say “the citizens of this community do not understand the cost of government”. Au contraire Councilman. The citizens do understand what it costs to run government. What they do not understand, or share, is the Council’s desire for more and greater government which in turn requires more and more and greater taxes and fees. So when our citizens’ vote against tax increases what they are really saying is we do not want more government – just stop. The City Council goes around the voters, do what they want to do, create more programs, hire more consultants and then impose more fees (taxes).
A deep seated mistrust now exists. This widening gap of distrust between the government and the governed, at all levels, is very dangerous if history teaches us anything.
Editors:
B. Alviani S. Doll J. Tingstrom
K. Corse B. McCord T. Cook
For more information like this, subscribe to our newsletter, Res Publica. Click here to enter your name and email address.
