Saturday, April 25, 2015

[Marin County] Dick Spotswood: The long-term cost of keeping taxpayers in the dark


Marin County’s civil grand jury has again proved itself to be a proactive agent for reform and good government. The publication of its latest report, “Pension Enhancement: A Case of Government Code Violations and A Lack of Transparency,” is an exposure from a Marin perspective how the Golden State’s public employee pension systems zoomed out of control.
The grand jurors explain that in just one six-year period, between 2001 and 2006, there were 36 pension enhancements by just four Marin agencies, “each of which appears to have violated disclosure requirements and fiscal responsibility requirements” of California law.
The report looks at Marin’s county government, the city of San Rafael and two fire districts, Novato and Southern Marin. Those four were selected because unlike other Marin cities and special districts that belong to the state retirement system, CalPERS, they are members of the Marin County Employees Retirement Association.
The jury reports that during the critical periods and upon advice from their attorneys, the four agencies broke the law by not holding public hearings when “enhancing” their employees’ retirement benefits. More critically, they failed to conduct accurate or timely actuarial evaluations of the future cost of those enhancements.
This is a big deal.
The jury is saying that the public was kept in the dark while “the unfunded pension liability of MCERA ... increased from a surplus of $26.5 million in 2000 to a deficit of $538.8 million in 2013.”
Since the granting of these benefits was in violation of California law, arguably they’re not properly vested and subject to cancellation.
As Marin’s Citizens for Sustainable Pensions has long pointed out, public pension deficits have broad implications.
While senior bureaucrats benefit, lower-income residents dependent on the frayed public safety net are most harmed by these excesses. Money diverted to fund rich pensions necessitates cuts to essential social services and infrastructure maintenance.
The reality is that the bulk of pension cash funds retirements and lifetime health insurance for those civil servants at the top of the government food chain. As a percentage, relatively little goes to those employees earning under $100,000.
The poster boy for this propensity may be Marin County Counsel Steven Woodside. A competent attorney who has served as the top lawyer for Marin, Santa Clara and Sonoma counties, Woodside is a triple dipper enjoying the fruits of pension enhancements.
It’s chronicled in California Policy Institute’s “Transparent California” database, assembled from information obtained via the Public Records Act.
On top of his $256,636 total compensation package from Marin, Woodside now receives two pensions from his past employers. He annually reaps $94,779 from the Santa Clara retirement system and gets another $82,606 a year from Sonoma.
The county’s senior civil lawyer has an annual gross income from all governmental agencies of $434,020.
Perhaps the violation exposed by the grand jury with the greatest negative impact was the failure to publicly document “the fiscal impact that the proposed benefit changes or salary increases will have on the funding status of the county’s employee retirement system.”
Without accurate and timely actuarial studies, it’s impossible for decision makers or the public to know the impact of actions often shrugged off as inconsequential and buried on council and supervisorial “consent calendars.” Certainly the public was unaware that these “enhancements” would cause the county to face a half-billion-dollar pension deficit.
Imagine the brouhaha if that fact had been known before any decision was made. That would be a mere kerfuffle compared to the explosive that will occur if the public pension house of cards ultimately collapses and taxpayers find out that they’re holding an empty bag.
April 25, 2015
Marin Independent Journal
By Dick Spotswood, Columnist

Civil grand jury urges Marin supervisors to lead fight against homelessness

A new Marin County Civil Grand Jury report says a leadership void exists when it comes to addressing homelessness in Marin, and the grand jury is calling on the Board of Supervisors to fill it.

“The county must assume the leadership role to eliminate homelessness,” the report states. “It is the only political entity that represents all of the residents of Marin. It is the only entity with the political power to coordinate all efforts on behalf of the homeless in Marin. It is the only entity that manages the delivery of social services to the homeless through its contracts with nonprofit providers.”

The grand jury recommends that the supervisors develop a systemic plan to end homelessness in Marin and direct county Chief Administrative Officer Matthew Hymel to recruit a high-ranking official to implement the plan.

“We will review the grand jury report and work with our new director of Health and Human Services to make sure that we are appropriately responding to this important community issue,” Hymel said. “Although the county has taken a leadership role in the past, we acknowledge that there is much more that needs to be done.”

Christine Paquette, St. Vincent de Paul executive director, said it would be helpful if the county were to show more leadership in the effort to battle homelessness in Marin. She said Jason Satterfield, the county’s homelessness analyst, does a good job, but she said, “his power at the county level is limited.”

St. Vincent de Paul manages the county’s “rotating emergency shelter” or REST program, which operates from Nov. 15 to April 15.

HOUSING ISSUE

But regarding the grand jury’s recommendation that the county develop a plan to end homelessness in Marin, Paquette said achieving such ambitious goals would probably require large-scale changes in the nation’s economic system.

“To end homelessness, you’d have to end unemployment, you’d have to end mental illness, you’d have to end addiction, you’d have to end divorce, domestic violence, and rental increases,” Paquette said.

Meredith Parnell, a spokeswoman for Congregation Rodef Sholom, said the grand jury report fails to address the connection between homelessness and Marin’s shortage of affordable housing.

“There are plenty of people who are homeless in the county who nobody sees because they’re not on the street. They have jobs to go to during the day, but they actually don’t have a place to live,” Parnell said. “The fact of the matter is we don’t have adequate housing for the people who actually live in this county.”

Rodef Sholom is a member of the Marin Organizing Committee, which helped create REST and is seeking to create a new multiservice homeless facility that will operate 24 hours a day, seven days a week.

SAN RAFAEL BURDENED

The grand jury said that the city of San Rafael bears the brunt of homelessness in Marin, chiefly because most of the nonprofits serving the homeless are located there. According to the report, “Several of the public safety officials interviewed from other towns stated that they are directing homeless people to the services in San Rafael, in some cases dropping them off there.”

The grand jury notes that San Rafael reports spending approximately $1 million per year on homelessness including funding for a Downtown Streets Team and a mental health officer. Forty-eight percent of the 933 individuals identified in the 2013 one-day count of the homeless were in San Rafael.

San Rafael Mayor Gary Phillips said, “We’re optimistic that we’re going to be able to work closely with Damon Connolly and the other supervisors to address this on a broader base than just San Rafael.”

As part of its campaign to create a new homeless shelter, the Marin Organizing Committee has been seeking financial contributions from all of Marin’s cities and towns. Phillips said San Rafael Councilwoman Kate Collins is asking all of the municipalities for contributions to continue the REST program so the financial burden on the county can be lightened.

“Because we do think homelessness is a countywide issue,” Phillips said.

But the grand jury report states, “The local municipalities in Marin County are not in a position to assume the leadership role.”

HOMELESS BUDGET

The grand jury notes that the majority of homeless support services available in Marin are provided by various nonprofits through contracts with the county and that the county reports spending $15 million per year on homelessness. Hymel estimates about $14 million comes from the county’s general fund. That includes portions of various county programs such as mental health, substance abuse, aid to military veterans, child welfare programs and homeless shelter contracts.

The grand jury says it is impossible, however, to discern exactly how much the county is spending on homelessness, because contracts with nonprofits are not limited to services for the homeless. It recommends that supervisors develop a “comprehensive county budget for homelessness that is clear to the public and includes revenues and expenditures from all departments and sources.”

The grand jury wrote, “Effective leadership will require a tightly managed coordination of the subcontractors to prevent duplication of services and unproductive competition. These multiple independently funded programs in Marin must operate consistent with the systemic plan.”

COST SAVINGS

The grand jury also suggests that the costs of addressing homelessness more effectively in Marin be weighed against the current cost of homelessness. A February 2013 report prepared by Home Base, a San Francisco public policy law firm, estimated that just 34 chronic inebriates, 32 of whom were homeless, cost Marin County more than $2 million, or $59,984 per person, in one year. This included interactions with police, fire, and hospitals.

The grand jury wrote, “If 34 chronic inebriates cost more than $2 million in public safety services in one year, the total cost of all of the public safety services used by all the homeless is far in excess of that number.”

And the grand jury cited an August 2012 report prepared by the Marin Economic Forum that estimated the downtown areas of Novato, Sausalito and San Rafael might be losing as much as $30 million per year in revenue not generated due to homelessness. According to that report, regaining that revenue would support more than 216 jobs annually and generate $3.3 million in local and state tax revenue for city and county governments in Marin.

ABOUT THE AUTHOR
 Richard Halstead
Reach the author at rhalstead@marinij.com or follow Richard on Twitter: @HalsteadRichard.

Friday, April 24, 2015

[Orange County] Ethics needed in public office


Earlier this month, a coalition of Orange County residents did what politicians have refused to do – they took steps toward establishing an ethics commission in Orange County.
For the next several months families in our community will spend much of their free time collecting signatures to place an ethics commission on the ballot for a vote of the people.
Two recent grand jury reports have clearly established the need for an ethics commission, providing clear evidence of a culture of corruption that has spanned decades and has led not only to massive waste and graft, but has also enabled lives to be destroyed with virtually nonexistent consequences.
Some recent examples continue to raise concerns.
Two years ago, the FBI confirmed the establishment of a Government Corruption Task Force in O.C. to investigate reports of political corruption. When no criminal charges are discovered, there exists no county mechanism to sort out ethical issues that arise.
Former Santa Ana City Councilman and rising Republican Party star Carlos Bustamante was working as an executive in O.C. when he allegedly sexually assaulted several female employees. When someone had the courage to complain, the county assigned his subordinate to investigate. Not surprisingly, the “investigation” was botched, and Bustamante allegedly continued his predatory behavior. It was only after charges were filed by the district attorney and the Orange County grand jury investigated that the county took the allegations seriously.
Money regularly changes hands between corporations, lobbyists and politicians responsible for awarding contracts with little to no oversight. For example, an Orange County Employees Association analysis found the previous Board of Supervisors took more than $180,000 in campaign contributions from Xerox Corporation, its lobbyists and affiliated groups, and then awarded the company more than $132 million in information technology contracts. Now, the contracts are behind schedule, in danger of being over budget, and Xerox has routinely failed to deliver the services they promised.
Just last week, news emerged about Newport Beach City Councilman Scott Peotter receiving campaign contributions from a local business and its owners in an amount allegedly over legal limits. According to reports, when the City Clerk advised Peotter of the violation, he said he disagreed but would return the contributions anyway. Yet according to the Daily Pilot, there has been no record of contributions being returned on Peotter’s campaign finance reports.
The grand jury outlined a better way than blind trust alone to restore our community’s faith in government. They called for the establishment of a county-wide ethics commission.
Unfortunately, our county’s leaders have refused. Instead, they have responded by trying to distract us with a scheme to bring in the State’s Fair Political Practices Commission (which would only spot-check campaign contribution documents) instead of a far more effective local commission. They’ve also contrived a pseudo-transparency measure called COIN aimed at avoiding state law in their contract negotiations with workers.
None of these “solutions” address the real issues outlined by the grand jury, but an ethics commission could.
So how about we join together and do what the politicians won’t – establish an ethics commission in Orange County.
April 24, 2015
The Orange County Register
Opinion
By Jennifer Muir, Assistant General Manager, Orange County Employees Association

[Marin County] Top Marin lawyer targeted in pension probe


The Marin Civic Center’s top lawyer is under fire from critics who say he’s a $434,000 “triple dipper” packing two pensions and conflicts of interest that rule him out as an impartial analyst of a grand jury investigation disclosing pension wrongdoing by county supervisors, San Rafael officials and others.
The civil grand jury reported that officials years ago repeatedly broke the government code by approving retroactive pension benefits without advance public notice or required fiscal analysis, ballooning liability for taxpayers and raising questions about the legal standing of the benefits involved.
Of 107 violations unearthed by the jury, 92 were attributed to county supervisors. The California Employees Retirement Law of 1937 governing the Marin system says that before approving benefit increases, officials — in this case, the Board of Supervisors, San Rafael City Council and Novato and Southern Marin fire boards — “shall secure the services” of an actuary who “shall provide a statement of the actuarial impact upon future annual costs” which “shall be made public at a public meeting.” None of this was done.
Jury reports require a response, and Marin County Counsel Steven Woodside promptly announced he would direct a legal analysis of the report. He told the Independent Journal a legal challenge would be futile because benefits promised more than a decade ago by labor contracts trump procedural issues.
Critics rip top lawyer
Critics said Woodside’s statement prejudged the issue, and asserted that he had a conflict of interest because he collects two public pensions totaling $177,000, and served as Sonoma County’s top legal adviser when supervisors there made similar mistakes hiking pensions without proper notice, actuarial reports or disclosure of the fiscal tab.
The 66-year-old Woodside, who has served three counties as chief lawyer, said he does not believe he has a conflict but will “diligently review” the question before embarking on an analysis of grand jury criticism of wrongdoing involving his key client, the Board of Supervisors.
“I seriously doubt there is any viable cause of action or ability to unwind these contractual pension obligations” due to mistakes made a decade or more ago, Woodside said Thursday.
Woodside, who earns $256,600 a year in total compensation for serving as top lawyer at the Civic Center, accepted extra salary instead of a Marin pension, but collects a $94,800 state CalPERS pension for serving as county counsel in Santa Clara for 24 years, and a $82,600 pension for serving as county counsel in Sonoma for 12 years after that. He joined Marin as top counsel about three years ago.
Pension critics in Marin and Sonoma counties turned up the heat, calling Woodside’s payout an outrage, the result of an extravagant pension system the public cannot afford. They asserted that conflicts of interest prevent him from directing the Civic Center’s analysis of the grand jury’s disclosures about Marin’s pension improprieties.
Conflict of interest
David Brown of Mill Valley, reading a statement from Citizens for Sustainable Pension Plans, recited a shopping list of conflict contentions Tuesday, telling county supervisors that Woodside’s Sonoma County pension “benefits from the same kind of improperly authorized enhancements as have been found here in Marin.” The rest of Woodside’s staff, which benefits from the Marin pension system, has conflicts as well, Brown said, urging that an “independent legal counsel” be assigned to analyze and reply to the jury’s report.
 “This investigation must be done fairly and impartially,” the letter from the pension group said. “That means it must not be done by the County Counsel’s Office.” The county board made no comment.
Jody Morales, head of the Marin pension group, called for further investigation “by neutral third parties in a position to impose sanctions or reversals” to determine whether pension increases approved in violation of the code are vested or not. Woodside’s participation in addressing the jury report “is completely inappropriate on every level,” she said.
Sonoma critic chimes in
Ken Churchill, a founding member of New Sonoma, another pension reform group, alerted the 2012 Sonoma grand jury about transgressions by Sonoma supervisors in approving pension benefits years earlier without public notice and fiscal analysis. Churchill was called to appear before the Marin County Civil Grand Jury as well.
Woodside “was the one who did not follow the law in Sonoma County,” and as the top legal adviser was supposed to “make sure the county followed all the rules” when Sonoma supervisors violated the government code, Churchill noted. He said the “illegal increases” approved in Sonoma substantially boosted Woodside’s Sonoma pension.
Churchill, noting a state Supreme Court pension case Woodside was involved in as legal counsel cited the need to complete “all prescribed statutory steps,” said that while the Sonoma grand jury’s findings were swept under the rug by Sonoma officials, the new Marin jury report could have “huge” implications for similar systems across the state, where unfunded liabilities total $75 billion.
Woodside’s retort
Woodside begs to differ, saying errors occurring more than a decade ago cannot be used to roll back benefits. “If they are not timely challenged, they become vested,” he said. As for his work as top lawyer in Sonoma when supervisors there were violating the government code’s public notice and fiscal analysis rules, “I personally did not do the hands-on legal work,” Woodside said. “That’s no excuse. It was on my watch,” he noted.
At the same time, “a lot of water has passed under the bridge” since then, making the matter all but moot — aside from the need to make sure rules are followed in the future, he said.
Woodside, stung by the attack on his integrity after a long legal career that included big utility case triumphs in which he helped save ratepayers “many, many” millions of dollars, intends to pursue legal issues involved in the grand jury disclosures. The probe will begin with a decision on “whether there is a disabling conflict affecting me or members of my office,” he said.
“Whether there should be an independent third party, I haven’t made that decision yet,” the veteran county counsel said. “This should be about the law, and not the lawyers.”
April 23, 2015
Marin Independent Journal
By Nels Johnson

[Solano County] Grand jury finds emergency services need better radios, new building


The Solano County Office of Emergency Services (OES) needs better radio communication equipment and a new building if it is to respond to emergencies and disasters with the highest possibility of success, according to a report published by the Solano County grand jury.
The jury began its inquiry on Sept. 10, 2014.
The members toured the OES offices and communications center, where they “found the OES to be very efficient, very well managed and poised to handle emergencies in Solano County,” according to the report. The group noted that, during the time of their tour, Solano County OES was still assisting Napa County following the August earthquake.
The jurors interviewed various members of OES management, as well as staff from the OES command center and the dispatch center to find what concerns the agency had. They also reviewed the OES website.
One concern listed in the report is “dead radio reception,” due to radio signal interference caused by terrain, particularly in canyons and ravines and on waterways.
“The remedy for this problem requires repeater stations and suitable appropriate frequencies,” the report concluded.
However, lack of funding has slowed this project. The grand jury recommended that the county and the agencies affected by communication dead zones treat this as a “high-priority item” and secure adequate funding for repeater towers, frequencies and associated equipment.
Both the stability and the location of current OES offices are also of concern to the agency.
The command center and communications center at those offices are located in a severe flood zone, according to OES staff, the grand jury cited in the report.
In addition to its location, the building, which houses both equipment and staff, is considered unstable.
“Recent seismic activities have resulted in damages demonstrating the lack of stability in the building,” according to the report.
A county-owned site near the Clay Bank and Stanton detention facilities off Clay Bank Road is one potential location for new housing of both the OES and the Sheriff’s Office communications center.
The grand jury recommended that the Solano County Board of Supervisors approve and secure funding for the construction of a new facility.
“The recent Napa County earthquake disaster is evidence of the possibility of extensive damages locally and the need for rapid emergency services,” the report read.
OES personnel are “well-trained and capable of accomplishing their assigned duties,” the report concluded. “They need safe facilities and reliable communications equipment to accomplish their mission successfully.”
April 22, 2015
Vallejo Times-Herald
By Jessica Rogness