-
San Jose College Leader
Worked Another Job While on Sick Leave.
The San Jose Mercury News reports: "A top executive at the financially
troubled San Jose/Evergreen Community College District earned a full salary
while on sick leave this spring yet, during that same period, she earned a
separate salary teaching at another nearby district."
Bayinaah Jones, whose title
at the San Jose district is executive director of institutional effectiveness,
earned $30,672 on sick leave there, but apparently was healthy enough to hold
down a $5,775 teaching position in the Foothill-DeAnza Community College
District.
The revelation follows a
searing state audit of the San Jose district's books. Auditors were critical of
spending by former Chancellor Rosa Perez, who is Ms. Jones' live-in partner, and
who also took paid sick leave for eight months, earning $25,000 each month
until retiring this month due to health reasons.
Records show that Ms. Jones
took sick leave from her $123,000 position "per my physician's order," she
wrote in an e-mail message in April, May and June of this year. She said she
remains sick "until further notice."
During those same months, the
Mercury News reported, she commuted to a job teaching Introduction to
Sociology classes at DeAnza College, for three hours a night every Monday and
Wednesday during the spring quarter. In e-mails to the newspaper, both DeAnza
and San Jose/Evergreen confirmed Ms. Jones' employment. However, Ms. Jones told
the newspaper in an e-mail: "I do not have concurrent employment. Your
information is incorrect." She declined to explain further, and referred
questions to school officials who said they would not comment because the
situation involves confidential medical information.
The state Department of
Finance said the district's board is fiscally responsible for Ms. Jones'
behavior.
The Mercury News noted
that budget cuts have resulted in the cancellation of classes and lay-offs of 19
workers last year. "They sacked several employees whose only crime was to remain
at their posts," said San Jose City College photography professor Ciaran
MacGowan.
The situation involving Ms.
Jones "shows a complete lack of respect for taxpayers, students, faculties and
administrations of both districts," said Randi Kinman, a former San Jose
planning commissioner who now helps lead the nearby Sherman Oaks Neighborhood
Association. (Source: San Jose Mercury News, July 5.)
Cal-Tax recommendation:
School officials should examine how their existing policies allowed this
situation to occur, and should make sure it doesn't happen again. They also
should thoroughly assess Ms. Jones' claims and take disciplinary steps if
warranted.
-
Small Cities Offer City
Managers Big Bucks.
A June 30 report by the
Placer County Grand Jury found that the cities of Auburn, Colfax, Lincoln,
Rocklin, Roseville and Loomis are paying their city managers excessive salaries
and other benefits. The grand jury said the city managers are receiving pay
comparable to city managers in the San Francisco Bay Area, where the cost of
living is 30 percent higher.
|
Compensation of City Managers in Placer County, 2009-10 |
|
City |
Pop. |
2009-10 City Budget |
Total Compensation |
Other Benefits |
|
Auburn |
12,500 |
$28.25 million |
$165,154 |
Car allowance, $4,800. |
|
Colfax |
1,750 |
$8.52 million |
$75,000 |
Mileage reimbursement of
55 cents per mile. Bonus of up to 10 percent of base salary. |
|
Lincoln |
37,410 |
$46.16 million |
$279,781 |
Car allowance, $8,400.
Relocation pay, $18,000. |
|
Rocklin |
54,754 |
$61.20 million |
$300,398 |
None. |
|
Roseville |
112,343 |
$447.20 million |
$393,675 |
Car allowance, $9,000. |
|
Loomis |
6,300 |
$3.22 million |
$132,671 |
Car allowance, $3,600.
Relocation pay, $3,000. |
While the grand jury noted
that the pay for city managers is very generous, the report indicates a welcome
trend in Placer County with declining tax revenues during the recession, a
number of cities are beginning to scale back pay and retirement benefits. For
example, Auburn, Colfax and Lincoln each cut compensation packages for their
city managers. The Auburn City Council and manager recently agreed to scale down
the city manager's pay by $15,160, bringing the salary to $132,371.
In Rocklin, Carlos Urrutia
retired from his post as city manager in 2009, after 25 years. Mr. Urrutia will
stay on the city's payroll working for a fixed annual stipend of $139,000 with
no benefits until the city finds a replacement. In addition to paying the
stipend and Mr. Urrutia's retirement benefits, Rocklin taxpayers will shell out
$300,000 in 2010 for Mr. Urrutia.
Roseville California's
fastest-growing city, according to data from the Department of Finance
recently parted ways with City Manager Craig Robinson and agreed to a severance
contract offering Mr. Robinson one year of pay and benefits, amounting to a
package of $393,675. Roseville's assistant city manager took over with a much
smaller salary of $185,226. (Source: Placer County 2009-2010 Grand Jury Final
Report: "City Managers' Salaries, The Delicate Art of Setting Salaries,"
June 30.)
Cal-Tax recommendation:
Cities throughout the state should examine their pay structures for all city
jobs and look for ways to reduce payroll, pension and fringe benefit spending so
they can provide needed services at the lowest possible cost.
-
Placer County Approves
More Than $1 Million in Raises for County Employees.
The Placer County Board of
Supervisors met June 22 and approved new employee contracts that will likely
cost taxpayers more than $1.3 million a year.
The county approved new pay
and compensation packages for adult services chief psychiatrist Dr. Olga
Ignatowicz ($371,372 annually); health and human services employee Dr. Richard
Malek ($303,193 annually); county forensic pathologist Dr. Donald Henrikson
($297,797 annually); and also approved salaries of $181,680 and $150,115 for two
county psychiatrists.
Law enforcement and public
health officials lobbied the Board of Supervisors for the pay raises, claiming
they were needed to keep government jobs competitive with private-sector jobs.
Also, public employees noted that they hadn't received a pay raise in four
years.
Supervisor Kirk Uhler, who
represents the communities of Roseville and Granite Bay, justified his decision
to support the pay increase, saying: "Market forces are at work. It's what the
market bears." (Source: Roseville Press Tribune, June 30.)
Cal-Tax recommendation:
Placer County has been using reserves, furloughing employees and taking other
steps to deal with major declines in revenue. The county shouldn't negate this
work by granting salary and benefit increases that will be very costly in the
long term.
-
San Diego School District
Spends $2.3 Million to Rehire Retirees After Giving Severance Deals.
The San Diego Unified School
District, after offering early retirement to more than 1,000 of the district's
highest paid employees, has begun rehiring these same employees.
The district chose to offer
early retirement to a number of employees as a cost-saving measure that was
projected to save the district more than $41 million. The early retirement
incentive was that if an employee chose to retire, the district would offer the
employee one year of pay without working. Now, the district claims that it is
suffering from a "brain drain," and has rehired district workers.
For example, the district
rehired Karen Bachofer, an employee who oversaw school research and evaluations.
When she left, Ms. Bachofer had an unfinished project to determine if students
met certain college admission requirements. She was quickly rehired by the
district and paid $10,000 to complete her project while earning her normal
salary of $134,000, which the district paid out as an early retirement
agreement.
The district originally
intended to rehire three dozen employees after offering them early retirement.
Instead, more than 10 times that number were rehired. Since offering early
retirement last year, the district has spent $2.3 million to rehire employees
and paid $24 million to employees for taking early retirement. (Source: Voice
of San Diego, July 2.)
Cal-Tax recommendation: The
school district should rethink its management strategies, and residents of the
district should get involved to force the district to be more prudent with the
tax dollars it receives.
-
Bell City Council Members
Paid Nearly $100,000 for Part-Time Service.
The Los Angeles County District Attorney's Office is investigating why members
of the Bell City Council are being paid $8,083 a month for their part-time
service on the council. A letter from the district attorney notes that under
state law and based on population, part-time city councils should be paid $400 a
month.
The district attorney's
representative said it appears that members of the City Council are receiving a
base salary of $150 per month, and then are inflating their pay by nearly $8,000
a month by receiving salaries for serving on various bodies including the
Community Redevelopment Agency, Public Finance Authority and Surplus Property
Authority. The population of Bell is approximately 40,000.
Bell's vice mayor said the
$8,083-a-month figure is misleading, because it includes the cost of medical
insurance, retirement and other benefits. (Source: Los Angeles Times,
June 24.)
Cal-Tax recommendation:
District attorneys throughout the state should examine whether other city
councils are engaging in similar shenanigans.
-
San Diego Official
Promised to Take Pay Cut, but Says Oversight Kept Full Salary in Place.
The San Diego Union-Tribune reports: "The San Diego city auditor, in
charge of holding officials accountable for how they spend taxpayer money,
neglected to sign documentation that would have led to his overall compensation
being reduced by $5,000 during the past year. Eduardo Luna, who was hired in
2007 but became the city's first independent auditor last year, had promised to
take a 6 percent pay cut along with nearly 10,000 other employees to help solve
a budget crisis. But Luna took only about half the proposed cut after he failed
to sign paperwork to change the city's matching contributions to a retirement
account."
The issue became part of a
larger City Council discussion June 14 after an internal document showed that
the promised benefit changes had never been applied. Councilman Todd Gloria then
questioned whether Mr. Luna had indeed taken the full 6 percent reduction in
compensation as required by his contract.
Mr. Luna took responsibility
for the mistake and said he is working to reimburse the city for the roughly
$5,000 he received. He said he overlooked signing the form and didn't realize
his error until he was notified in April.
Under his contract, Luna
makes $168,000 annually. He intended to give up two separate city matches to his
retirement account, which would have saved the city $10,080. Half of that total
didn't require any action on his part. Because the money involved was a city
match, there was no change in his take-home pay, and Mr. Luna said he had no
reason to believe he wasn't complying with his promise to take the cut. (Source:
San Diego Union-Tribune, June 15.)
Cal-Tax recommendation: We
applaud Mr. Luna for owning up to the mistake and promising to reimburse the
city, and we hope that this situation prompts all city officials to keep a
closer eye on employee pay issues.
-
During Budget Crisis,
University of California Adds to Ranks of Highly Paid Senior Officials.
The San Francisco Chronicle reports: "It has been a period of austerity
at the University of California, with layoffs, across-the-board pay cuts and fee
hikes. Yet some UC employees earned significantly more money in 2009 than in
2008, with two more million-dollar earners added to the payroll, new salary data
show. The number of UC employees classified as 'senior officials' earning more
than $214,000 in total compensation rose 6.3 percent, to 3,184 from 2,996
people. Lucrative overtime pay also rose sharply. Employees earning more than
$10,000 in OT climbed 79 percent, to 2,733 from 1,531 employees."
The paper noted that UC's top
overtime earner, an operating room nurse at UC San Francisco Medical Center,
took in nearly $97,000, boosting her total compensation to more than $320,000.
The figures come from payroll data for 250,249 people paid by UC in calendar
year 2009, and from UC's new report on executive compensation. (Source: San
Francisco Chronicle, June 3.)
Cal-Tax recommendation:
Clearly, operating room nurses are crucial employees who deserve fair
compensation, but massive overtime spending raises red flags about possible
management problems. State lawmakers should review the UC's pay and management
policies as they craft the new state budget.
-
Bay Area Public Employees
Help Push Local Governments Into Bankruptcy.
While many Bay Area local
governments are nearly bankrupt, a Santa Clara County Grand Jury reported May 26
that public employee compensation has far outpaced cost-of-living expenses, pay
granted to similar private-sector positions, and revenues generated by local
governments. The 33-page report charged city councils with bending to local
unions to favor public employees, rather than the funding needs of their cities.
The report notes that public
employee salaries have continued to rise "even when the economy struggles."
Since 2000, most public employees' wages and pensions have increased 37 percent,
while fire and police officer compensation has increased 41 percent.
San Jose Mayor Chuck Reed and
City Councilmen Pierluigi Oliverio and Pete Constant have recently called for
city employees to accept a 10 percent cut in pay and benefits. They said the
report backs up their position.
The report said that the
primary compensation problems are that many employees are not required to
contribute much to their employer health plan, employees are given large
"cash-out" bonuses for unused sick leave and vacation time, and that retirement
pension benefits have been increased 25 percent to 50 percent. Menlo Park voters
will have the option of scaling back public employee retirement benefits this
November, since the City Council decided to place a pension reform measure on
the ballot.
Public employee unions
criticized the report's methodology and claimed that the conclusions are
ill-informed. (Source: San Jose Mercury News, May 27.)
In related news, the
Contra Costa Times reported that a new database has been developed by the
Bay Area News Group to let people view and search public employee salaries. The
database shows that taxpayers paid $12.2 billion to fund the salaries of
government workers in 109 government agencies in the Bay Area last year.
The database points out
several examples of employees making several hundred thousand dollars per year.
For example, Nancy Farber, chief administrator of a hospital in Fremont,
received $847,811 (her pay dropped $30,000 from 2008); Charles Keohane, a San
Francisco policeman, received $516,118; and Jana Dolnikova, a doctor at a Santa
Clara hospital, was paid $507,748. (Source: Contra Costa Times, May 24.)
Cal-Tax recommendation:
Massive salaries for government workers are not sustainable, and they make it
difficult for local governments to provide quality services for residents who
need them. Every local government should take a hard look at its salaries and
benefits, and should correct problems that have been allowed to grow.
-
Local Government Employees
Doing Well One City Manager Makes $460,000 a Year.
The Orange County Register's OC Watchdog blog reported May 17 that a
compensation study by graduate students from Brandman/Chapman and Pepperdine
universities found that city managers are doing quite well in that area.
In addition to
determining the standard salary, benefits, deferred compensation and pension
contributions, the students asked the county's 34 cities how much was spent on
the city manager's vehicle purchase/payments, car insurance, car repair, car
maintenance, gasoline, cell phone equipment and usage, toll road fees, in-home
computer/office equipment, dues and subscriptions, travel and meetings, payouts
for unused vacation and sick leave.
The most highly
compensated city manager in Orange County is not from Anaheim or Santa Ana --
its largest cities -- but from one of its smallest cities: Bruce Channing of
Laguna Hills, at $460,809, the
report says.
In the two largest
cities, Anaheim's David M. Morgan received $317,923, while Santa Ana's David N.
Ream received $327,074.
Earning the least
is the executive of Villa Park. The city manager there works 32 hours a week and
receives $170,920.
"This study may
well serve as a wake-up call to citizens to question the adequacy of municipal
financial data," Barbara Kogerman writes in a forward to the report that her
students prepared. "'Transparency,' a popular buzz-word among politicians, is
easy to claim but difficult to find; obscurity is the more common practice."
Meanwhile, the
Daily Post of Palo Alto reported May 17 that top officials in the Burlingame
Police Department will receive 2 percent salary hikes for three years, despite
the city's budget problems.
The current average
salary for a sergeant is $139,532 plus benefits, while a police captain receives
$180,852 plus fringe benefits. (Sources: OC Watchdog blog and Daily
Post, both May 17.)
-
San Luis Obispo County
Paid Half a Million to Workers on Leave.
The Tribune of San Luis Obispo reports that over a three-year period, the
county paid $519,460 to 60 employees who were on leave while their work
performance was being investigated. The figure comes from a civil grand jury
report on the county's disciplinary procedures.
The grand jury found that the
average administrative leave lasted 31 work days. Because of personnel
confidentiality rules, the grand jury did not identify those who were placed on
leave.
The discipline system was
found to be "appropriate," but the grand jury recommended that the county
increase its training of managers. Supervisors "occasionally fail either to
notice or to document employee behavior that falls short," the grand jury wrote.
It cited three cases in which employees were marked satisfactory, "when
subsequent investigation revealed that the behavior had been unacceptable."
Grand jurors said they did
not know whether this was due to an oversight by the supervisor, a failure to
document inadequacies, "the supervisor did not have the courage or the skill to
provide the employee with honest feedback," or some other reason. (Source:
The Tribune, May 12.)
Cal-Tax recommendation:
Despite the lack of names in the report, the media reported that some of the
leave was paid to people who made headlines for inappropriate behavior,
including a woman who was let go for failing to disclose that she was in a
relationship with a union official with whom she was negotiating a county
contract. This raises the question of whether all employees should be placed on
paid leave during investigations, or whether some wrongdoing is so obvious that
there is no need to take the precaution of paying the employee during the
investigation. To the extent that it is possible to do so, the county should
keep its options open.
-
More Than 33 Percent of
San Francisco City Employees Paid Over $100,000.
When San Francisco's
taxpayers ponder where their tax dollars are going, they need to consider the
following: according to the San Francisco Chronicle, one in three city
workers was paid more than $100,000 last year. That figure includes overtime,
but excludes benefits such as health care and pensions.
The paper reported that out
of 27,000 people who work for the city of San Francisco, 9,487 reached the
six-figure club. The average city worker salary was $93,000, according to Deputy
City Controller Monique Zmuda.
Steve Falk, president and
chief executive officer of the San Francisco Chamber of Commerce, said state
Employment Development Department data shows that city workers earn 20 percent
more than those in the private sector. In addition, they have significantly
better health and pension benefits.
Bob Muscat, head of the
Professional and Technical Engineers Local 21, said, "City government is
becoming increasingly technical and more sophisticated, and you have to pay for
the talent."
San Francisco is facing a
$483 million deficit in 2010-11. (Source: San Francisco Chronicle, April
26.)
Cal-Tax recommendation:
Salaries and benefits should be brought in line with job responsibilities and
private-sector standards, so more tax dollars can be freed up to help those
truly in need.
-
Ventura Reaffirms Increase
in Firefighters' Pensions.
The Ventura City Council
voted 4-3 on April 26 to reaffirm an increase in firefighters' pension benefits,
despite a city budget shortfall of approximately $7 million.
The deal, originally approved
in August 2008, increases retirement benefits from "2 percent at 50" to "3
percent at 55" (allowing a rank-and-file firefighter to retire at age 55 with a
pension equal to 3 percent of his or her last year's pay, multiplied by years of
service). This will cost the city $548,271 in additional pension contributions
in 2010-11, and will increase the city's unfunded liability for public safety
pensions from $46 million to more than $50 million.
After the change was passed
in 2008, firefighters agreed to postpone the effective date until July of this
year. Members of the Ventura County Taxpayers Association lobbied the City
Council to ask firefighters for another postponement, but the council rejected
that plan.
Council members who voted to
keep the deal in place said they had no choice, because the previous vote was
legally binding and changing the deal now would lead to litigation. The
firefighters' current contract expires December 31, so negotiations for the next
contract will begin soon. (Source: Ventura County Star, April 26.)
Cal-Tax recommendation: The
next contract should not be so generous with taxpayers' money. While
firefighters should be fairly compensated for the difficult and dangerous work
they do, their benefits should not be so high that they jeopardize the city's
ability to stay solvent.
-
San Francisco "Premium
Pay" Rewards Cost $86 Million.
In addition to their regular
salary, San Francisco city employees get $86 million in "premium pay." This
extra amount can be amassed by employees who obtain extra education or serve for
a number of years. (It is not for overtime worked, which is another big ticket
item in the city's budget.)
For example, the $20 million
of premium pay that goes to members of the Fire Department raises their average
annual salary, before overtime, to $111,699 per year. Many engineers get an
extra 7.5 percent pay boost for knowing how to repair heating and air
conditioning systems. Bus drivers get an extra 8 percent for working after 6
p.m. and before 6 a.m. (this is not overtime, but extra pay for working
unpopular hours), and 50 cents per hour extra for working in the same division
for more than five years, plus free fitness club enrollment. (Source: Phillip
Matier and Andrew Ross in the San Francisco Chronicle, April 19.)
Cal-Tax recommendation: The
city should take a close look at whether this added cost for taxpayers is
providing any real benefit to the people of San Francisco.
-
Orange County Retirement
System Makes $228 Million Mistake.
The computer system responsible for determining the cost of future pension
benefits to Orange County employees suffered from an "anomaly" and
underestimated the county's total pension liability by $228 million, county
officials acknowledged. The "anomaly" occurred when the system was being
programmed in 2003. When staff installed the computer program, they had the
Orange County Employees Retirement System compute data based on faulty
assumptions.
In regard to how the problem
will be corrected, OCERS Chief Executive Officer Steve Delaney said: "There are
a number of accounting process options available for dealing with the gains and
losses as they occur each and every year. We are currently exploring appropriate
funding methods with the assistance of our actuary and will discuss those in
more detail at our May Board meeting." (Source: Orange County Watchdog,
April 21.)
Cal-Tax recommendation: The
county should tighten up its financial oversight, and should determine why it
took seven years to discover a computer glitch that threw the books off by $228
million.
-
Public Employees Get Big
Bucks in Palo Alto.
It is good to be a public
employee in Palo Alto. Not only is it a wonderful place to live, but
financially, it is very rewarding.
Overtime pay is up 17 percent
in 2009 (from $4.7 million to $5.5 million) a major increase during a tight
budget year. Ryan Stoddard, a fire apparatus operator, earned $77,000 in
overtime, giving him a total of $172,000 in take-home pay. Fire Chief Nick
Marinaro blamed the situation on the fact that more firefighters than usual were
out on disability leave.
For employees hired before
1983, there is a generous policy allowing them to cash out unused sick leave and
vacation time. A janitor for the city, Ted Schroder, got $106,000 added to his
2009 salary of $50,000. He also gets a full pension and lifelong health
coverage.
Despite efforts by City
Manager James Keene to rein in expenses in 2009, the city's total payroll grew
by approximately $1 million, due largely to raises and payouts negotiated in
prior years. (Source: Palo Alto Times, March 24.)
Cal-Tax recommendation: The
city should learn its lesson, and should put tighter restrictions on overtime,
coupled with more fiscally responsible salaries and fringe benefits.
-
School Superintendent Gets
Huge Payment to Leave One District, Then Gets Hired by Another District and
Leads it to Failure.
The State Board of Education recently made history by taking over two school
districts for academic and leadership failures. The story of how one of the
districts arrived at this embarrassing juncture is a textbook example of
mismanagement in the public education system.
The district is the Alisal
Union School District in Salinas. The superintendent of the district is
Esperanza Zendejas, who formerly was superintendent of the East Side Union High
School District in San Jose.
Ms. Zendejas was forced out
of the San Jose district in 2005, after two years on the job, and was given a
$337,000 severance deal. Her hand-picked personnel director succeeded her, until
he recently was forced out over allegations of what the San Jose Mercury News
described as "financial shenanigans."
After getting the massive
severance deal, Ms. Zendejas joined the Salinas area district, where her job
performance again led district officials to seek her ouster. The Alisal board
asked her to resign, but she refused. The board got her to leave, but only by
rehiring her as a $14,000-a-month "consultant." While paying this generous sum,
the district also hired an interim superintendent for $168,000 a year.
Now, the State Board of
Education has sent a trustee to take over the district, with the agency citing
the school district's failure to progress toward educational standards. The
state board also said the district's leaders have problems "managing adult
relationships." (Source: San Jose Mercury News, April 4.)
Cal-Tax recommendation:
School boards should do a better job of hiring superintendents, and should not
offer severance deals that waste taxpayers' money.
-
Rocklin Gives Early
Retirement Deals to City Managers, Then Rehires Them.
The city of Rocklin recently
gave generous early retirement packages to nine managers in an action described
as a salary savings maneuver. However, The Sacramento Bee reports that
"rather than sending the retirees off with some cake, the city rehired them for
their old roles as part-time employees."
Under this arrangement, City
Manager Carlos Urrutia will receive $170,000 a year from his California Public
Employees' Retirement System pension, even while earning $139,000 from the city
as a part-time employee. His total take-home pay will be $309,000, up from his
former base pay of $230,000.
When the managers "retired,"
Rocklin gave them two years of service credits to boost their pensions, making
the double-dipping even more costly.
City officials say that
because the city no longer will be paying medical benefits for the managers, and
will not have to contribute any more to their retirement, the city will save
more than $700,000 addressing an immediate cash-flow problem. But Wally
Reemelin, president of the League of Placer County Taxpayers, said it is
"utterly ridiculous" that "the city is in financial hardship and they give these
gold-plated deals to them." (Source: The Sacramento Bee, March 15.)
(Cal-Tax recommendation: How
about just eliminating some unneeded management positions, filling others will
lower-paid employees, and cutting back on overly generous benefits? Shuffling
employees around does not address the long-term problems, and simply adds to the
public perception that government cares more about padding government workers'
wallets than about protecting taxpayers.)
-
Sacramento School District
Hires Six-Figure Spokesman While Teachers Get Pink Slips.
The Sacramento City Unified
School District recently handed out 738 pink slips to teachers, notifying them
of the possibility of being laid off later this year, but that didn't stop the
district from hiring a new spokesman for $114,178 per year.
Former Sacramento River Cats
spokesman Gabe Ross will fill the newly created "chief communication officer"
position. Former school spokeswoman Maria Lopez left the district last week to
take a job as a communication associate for the California Department of
Education, which is having budget problems of its own.
In an unintentionally ironic
statement, Mr. Ross said, "It's a time of great need in the district, and I am
looking forward to bringing my experience and expertise to schools when we
desperately need all the resources possible." (Source: The Sacramento Bee,
March 14 and March 17.)
(Cal-Tax recommendation:
Schools should examine their priorities and focus on their primary duty
educating students. In a time of budget shortfalls, keeping dollars in the
classroom should be a higher priority than hiring a six-figure public relations
expert to put out press releases saying more money is needed.)
-
Defeated City Councilman
Gets Unemployment Benefits.
Further evidence that some
local officials consider elective government posts as "jobs" rather than public
service, John Nunez, a Rosemead city councilman ousted by voters in March 2009,
was paid $11,250 in state unemployment insurance compensation. The city
protested, but the generous bureaucrats in the Employment Development Department
said the city needed to pay the claim.
The EDD's action, which came
despite a clear provision of state law that prohibits unemployment payments to
"elected officials" (Section 634.5 of the Unemployment Insurance Code), has
caught the attention of two state senators.
Legislation to spell out to
the EDD that "elected officials" include local elected officials (SB
1211, Romero and Dutton) is pending in the Senate Labor
and Industrial Relations Committee. (Source: Text of SB 1211; California
Unemployment Insurance Code; Los Angeles Times, March 10.)
(Cal-Tax recommendation: The
governor should determine who at the Employment Development Department decided
not to follow the law, and should take action to make sure it doesn't happen
again.)
-
Teachers Union Sues to
Get School District to Pay Teacher for Five Days at Family Reunion.
The Folsom-Cordova Teachers
Union wants taxpayers to pay for the five days that teacher Edith Hiatt took off
work to attend a family reunion. Claiming the union's bargained contract with
the school district requires Ms. Hiatt to be paid, the union filed suit in
Sacramento Superior Court in January.
Mark Schultz, president of
the teachers' union, said, "We have a contract and we feel it should be
honored."
Steven Nichols, a district
spokesman, said: "We don't want teachers to go on vacation in the school year,
during instructional time. It's an additional cost we cannot afford to spend,
especially right now."
(Cal-Tax: However, the
issue is not that clear-cut. Most school boards have caved in to teachers
unions, and now give time off with pay for "personal necessity," usually
amounting to five to 10 days a year. Considering that teachers get ample
vacations over summer, two weeks off at Christmas, a week at spring break and
Easter, as well as sick leave, allowing additional time off for "personal
necessity" is a big boondoggle. The issue in this case is whether attendance at
a family reunion is a "personal necessity.") (Source: The Sacramento Bee,
March 5.)
(Cal-Tax recommendation:
School boards should not expand the opportunities for teachers to get full pay
for not teaching. This is the hidden underbelly of school finance when schools
are promoting additional taxes and students are demonstrating around the state,
this benefit and many others like it should be mentioned as areas where savings
are possible.)
-
State Employees Getting
Millions for Cashing Out Unused Vacation Time.
A number of state employees
are getting millions of dollars for unused vacation time above limits set by the
state to prevent abuse of the system.
A study by Chase Davis of
California Watch, published in The Sacramento Bee and San
Francisco Chronicle, said, "State personnel officials acknowledge that at
least $100 million, and perhaps tens of millions more, was paid between 2006 and
mid-2007 to retiring state employees who went over the state cap."
The state has a set limit of
80 days' worth of unused vacation days that can be converted to cash on
retirement a very generous benefit in itself. State workers get between 10
days and 30 days a year of vacation, depending on the type of leave, bargaining
unit and length of service.
As of December 2008, more
than 14,000 employees on the payroll have banked vacation days in excess of the
cap.
One worker got more than
$800,000 in compensatory and vacation time.
According to the report, "In
one case, James C. Tudor Jr., the former president of the State Compensation
Insurance Fund, cashed out six times more vacation time than regulators allow,
taking home more than $550,000 after he was fired in 2007 in the wake of an
internal probe that 'uncovered serious abuses at the highest levels,' according
to state Senate documents." (Sources: San Francisco Chronicle and
Sacramento Bee, February 28.)
(Cal-Tax recommendation: The
limit should be adhered to, in every case. The over-the-limit payouts and
accompanying pension spikes are costing the taxpayers dearly, and this abuse of
the system must stop.)
-
Despite Budget Problems, San
Diego Assessor and Treasurer Accept Raises.
The San Diego Union-Tribune reports: "Budget problems led to layoffs in
San Diego County government last year, but pay is still rising for two elected
officials. Assessor-Recorder-Clerk David Butler accepted a 4.5 percent raise in
his annual salary this month, to $199,139. Treasurer-Tax Collector Dan
McAllister received a 3 percent increase, to an annual salary of $155,480."
Mr. McAllister told the
newspaper, "I realize these are difficult economic times and it's awkward out
there, but I really hadn't considered (waiving the raise)."
Two of the county's elected
officials did waive raises at least for the time being. District Attorney
Bonnie Dumanis waived an $11,000 increase and Sheriff William Gore waived a
$10,000 increase, with both saying they reserved the right to begin accepting
the salary increase beginning in July. Both are up for re-election in June.
The pay hikes were part of a
series of scheduled increases approved by the Board of Supervisors in 2007.
(Source: San Diego Union-Tribune, January 11.)
(Cal-Tax recommendation:
Elected officials should act as if every year is an election year, and should
remember that they are public servants, and their top priority should be making
the government work efficiently for the taxpayers. Accepting a pay raise while
services are being cut is a sign of misplaced priorities. Also, times are not
"awkward," they are downright tough, with California's unemployment rate at 12.3
percent even as a variety of taxes and fees are taking more money out of
Californians' family budgets.)
-
Government Workers in San
Jose Get Huge Pension Boosts Due to Errors.
The San Jose Mercury News reports: "San Jose's employee pension
fund, already bleeding money, may be handing out millions of dollars in
overpayments, according to a recent audit that calls for a massive review."
The audit reviewed pensions
for 133 of the 486 employees who retired in 2007 and 2008. In 10 percent of the
cases, retirees were receiving pensions higher than they were entitled to. The
overpayments stemmed from errors in calculating the pay that can be credited
toward retirement.
The audit also found a single
retiree who was being shortchanged by the city.
Major errors involved pay
beyond the base salary that should not have been counted toward retirement, but
was, and retroactive raises that artificially boosted pensions. One retiree's
pension was overstated by $630 a month, the audit found.
The Mercury News noted
that this problem is not unique. In Contra Costa County, former public workers
were overpaid for more than a decade because unused vacation time had been
counted toward their retirement. San Jose and the local firefighters' union are
currently in litigation over a software glitch that incorrectly credited some
unscheduled overtime toward firefighters' pensions. (Source: San Jose Mercury
News, December 27.)
(Cal-Tax recommendation: All
government pension officials should learn from these cases, and should
investigate their own systems to ensure that proper payments are being made.
Government pension systems already are creating major financial problems due to
the generous benefits that taxpayers provide to retirees, and overpayments just
compound the problem and make it more difficult for government to pay its
current workforce to provide services.)
-
Pension Spiking Is Rampant
in Contra Costa Sanitary District.
Columnist Daniel Borenstein of the Contra Costa Times reports that former
employees of the Central Contra Costa Sanitary District are getting filthy rich
thanks to rampant pension spiking.
For example, the departing
general manager boosted his pension by 37 percent, to $217,216 per year, by
cashing out nearly 17 weeks of unused vacation and sick leave time. In
retirement, he will receive nearly as much as the $234,163 per year that he took
home while working.
Mr. Borenstein analyzed the
records of 32 sanitary district employees who retired in the past five years,
and found that more than two-thirds had increased their retirement pay by 25
percent to 41 percent by taking advantage of spiking provisions.
Methods used:
-
Selling back vacation time
and adding the money to the final year's salary;
-
Selling back vacation time at
strategic times to increase the pay (vacation time can be sold back once per
calendar year, but the pension is based on the final 12 months of pay, so it is
possible to use a "straddling" technique to, for example, sell back four weeks
in December, four more weeks in January, and then retire in February with all
eight weeks added to the final salary);
-
Cashing out sick leave upon
termination (up to three weeks' worth);
-
Cashing out holiday pay (up
to 13 days of pay for holidays they worked);
-
Adding time to the number of
years of service by counting unused sick leave, with no limit on the amount that
can be accrued some workers had more than a year's worth of sick leave when
they retired, and they could apply this to their years of service, including the
three weeks that they sold back to boost their final pay!
Mr. Borenstein writes:
"Vacation time should be for workers to take time off and refresh themselves.
Sick leave should be available for illness.
The way the system works now,
employees in retirement collect the value of the unused vacation and sick leave
over and over again, approximately every year and a half, for the rest of their
lives." (Source: Contra Costa Times, December 27.)
(Cal-Tax recommendation: All
government pension plans should be corrected to eliminate pension spiking.
Government pension systems already are unsustainable, and workers who use
loopholes to spike their pensions are only adding to the problem.)
-
Indio Employees Live High
on the Hog. The
city of Indio (Riverside County) is facing a multimillion-dollar deficit. Yet,
since 2008, city employees have used city credit cards to charge $805,000 for
pricy meals, out-of-state trips, tickets to sporting events and even a trip to
Quebec for the city manager's wife.
The Palm Springs Desert
Sun reviewed 1,000 pages of credit card statements, for cards held by 20
percent of the city's employees, and found that spending increased substantially
this year over last.
Indio Mayor Gene Gilbert said
he was "blindsided" by the news, and he acted to pull all the credit cards
except those issued to department heads.
The Desert Sun
revealed that $9,200 was charged to the card issued to Mark Wasserman, the
assistant to the city manager, for two trips to see the Los Angeles Angels play
baseball and one trip to see the Minnesota Vikings play football.
Mr. Wasserman said the
$805,000 is less than 1 percent of total city expenditures. (Source: Palm
Springs Desert Sun, January 4 and January 5.)
(Cal-Tax recommendation: Cut
up the credit cards! For employees who absolutely need them, put tighter
controls on their use, and require quick repayment of any questionable spending,
like international travel expenses for spouses.)
