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Task Force Recommends Jacking Up Fees & Taxes

BY LIONEL EMDE, PACIFICA RIPTIDE CORRESPONDENT
 
Pacifica City Council heard a report April 12 that recommends raising taxes and fees on Pacifica residents to deal with an out-of-control city payroll problem threatening Pacifica's long-term fiscal future.
 
The "Financing City Services Task Force" report proposes three revenue-raising measures:
•Increasing Transient Occupancy Tax (TOT or hotel tax) from 10 percent to 12 percent. A vote on this increase would be on the November 2010 ballot and projected money raised over five years is $72,000.
•"Public Safety Assessment" would require a two-thirds majority vote of property owners, projected to be in "Spring 2011," raising $4 million over four years.
•"Revised Utility User’s Tax" would hit the ballot in November 2012, raising an estimated $2 million within three years.
 
The report concludes that if all these measures pass: "The total savings + revenue would equal approximately $14 million in five years, solving our budget deficit, giving us a reserve of over $600,000, and putting us on a surplus-building path."
 
The 800-Pound Gorilla in the Room
That the city has at least $17 million in unfunded pension liability to city employees and that eight of ten labor bargaining units could not reach agreement with management in last year’s budget negotiations goes unmentioned. In Pacifica’s most recent (2009) Comprehensive Annual Financial Report (CAFR), the management analysis says: "Due to a combination of enhanced (higher) retirement benefits and significant investment losses by (Cal)PERS ... the City will be absorbing a significant ongoing annual unfunded liability contribution for the foreseeable future."
 
We Pay More and More
The proposed fee and tax increases couldn’t come at a worse time, as water rates recently jumped between 13 and 24 percent, and the city sewer charge is rising more than 5 percent. On top of that, the recently signed garbage contract locks in the highest rates in San Mateo County and proposes rate increases in August 2010 and March 2011.
 
The task force report’s rationale for huge increases in taxes and fees on the public is a projected shortfall of $14 million in the city budget over the next five years. In stating the problem, the report reads: "Since the largest and fastest-growing component of the City’s budget is salary and benefit costs, we recommend that the city ask all employee labor groups, ... to make adjustments which will lower these anticipated costs over the next five years. These adjustments ... may include a freeze on wages and a freeze in the city’s contribution to retirement benefits."
 
Although Pacifica Chief of Police Jim Saunders stated in the 2009 budget negotiations that Pacifica ranks near or at the bottom of the pay scale for police personnel in San Mateo County, the total yearly value of wages, benefits, and pensions for some positions in Pacifica city government tells the story:
 
Police Records Sup(ervisor) $115,000
Police Evidence Supervisor $130,000
Police Captain $260,000
Firefighter $160,000
Planning Management Analyst $130,780
Recreation Supervisor $140,235
 
These employee positions are among those identified by the city manager that may be cut if new tax hikes are not approved by voters. Saved for the last attachment in the report are the really difficult items. Hiring freezes, merging of operations with other public agencies, layoffs, salary and benefit reductions, and a second tier of retirement benefits are some of the recommendations.
 
One of the wild cards here is the public, of whom much is asked in footing the bill for the as-yet-unmodified wage and benefit packages of city employees. The pace and breadth of the tax and fee hikes are unprecedented, and threats of service cuts loom even if all three measures pass. The report’s asserted $600,000 city reserve at the end of the process is very small, almost within the margin of error.

The other wild card is public-employee unions, which have not publicly acknowledged the unsustainability of the present budget situation. Last year’s lame attempt to extract concessions from them to obtain $800,000 in budget reductions largely failed. From the public’s perspective: What is the point of paying more and more for less and less?

Lionel's story also is posted on PENSION TSUNAMI

Comments

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How much is the fire chief paid in salary, overtime, and benefits? At what age can he retire and what will be his lifetime pension?

Please tell me so that I can decide whether to reach into my pocket to give more money to the City of Pacifica to continue to overpay its already grossly overpaid employees.

When the fire chief and police chief agree to take substantial pay cuts, then you can ask me to pay more taxes. Meanwhile, no way.

And why is it so difficult to find out what these guys get paid? Why does the city want to keep this information secret? What is the city hiding?

Looks like Pacifica is Bell by the Sea.

Would that we got numbers of positions instead of incomplete information.
How is the public supposed to react when we're expected to read between the lines?

$160,000 is for 3 firefighter positions as listed in the report.

Lionel:

The City of Pacifica anticipates an $8.5 million savings over five years through negotiations with labor groups, according to Option A of the report.

"Lionel, it's not possible that a regular firefighter costs the city $160K before overtime."

Matt,
You'll have to ask the task force members--it's their figure. If it does include overtime, then they should say so. I assume it's City of Pacifica data, because they were looking at all city departments.

I don't like the San Carlos proposal or the idea of a volunteer force. But where's the money?

There's another anomaly I just thought about that isn't explained in the task force report:
If the parcel tax raises $4 million over four years, and the utility user's tax increase raises $2 million over three years, that's $6 million by my reckoning.
If we have a $14 million shortfall over the same overall period of five years, where is the other $8 million coming from?

Bruce, thanks for the clarification on Social Security, and for the base salary information.

Lionel, it's not possible that a regular firefighter costs the city $160K before overtime.

I found this article from somebody who's upset about firefighter salaries on the coastside, and you can see that the "total cost" of the firefighters includes overtime.

http://coastsider.com/index.php/site/news/coastside_firefighters_pay_averaged_155000_per_year_in_2007/

If we go to a volunteer fire department, I propose that we not stop at half measures, and use volunteer police and paramedics, too.

I found this on the Internet. I know that for the state, when we figure our total wage and benefit, we add 32% to our salary to figure out the total.


Wildland Firefighter Range in Pacifica, CA
$36,000

Firefighter Hazardous Materials Technician in Pacifica, CA
$58,000

Hotshot Wildland Firefighter in Pacifica, CA
$31,000

Lead Hotshot Wildland Firefighter in Pacifica, CA
$41,000

Lead Wildland Firefighter in Pacifica, CA
$43,000

Wildland Firefighter in Pacifica, CA
$26,000

Firefighter Hazmat Technician in Pacifica, CA
$57,000

Firefighter EMT in Pacifica, CA
$48,000

Paramedic Firefighter in Pacifica, CA
$56,000

Lead Firefighter in Pacifica, CA
$61,000

Supervisory Firefighter in Pacifica, CA
$73,000

Firefighter Paramedic in Pacifica, CA
$59,000

Firefighter Senior Officer in Pacifica, CA
$155,000

Firefighter Basic Life Support in Pacifica, CA
$54,000

Supervisor Firefighter in Pacifica, CA
$72,000


Firing the entire FD & PD is a bad idea, as is a volunteer FD. Going to county police protection and CAL-Fire protection will mean increased insurance rates for every single structure in Pacifica. That is a fact.

As for Mr. Restivo, I guess you lived in Utopia. I grew up in a small town in Connecticut with two all-volunteer fire departments. Many, many homes were lost. The increased response time was responsible for some of the loss. Think about it. In our town, the firefighters simply have to don their gear and climb aboard their vehicles. In a volunteer town, the volunteers must be alerted, and drive to the fire department, all before they can get ready to head to the emergency.

Mr. Levie, for your edification, "safety" employees do not pay into Social Security, which is one reason their pensions are so "lucrative." I am a public safety employee and when I became one, my SS contributions stopped. Of course, it also means I will not receive as much SS when I retire -- between the reduced contributions (I did contribute at one time) and the "windfall" deduction from SS, I will collect only the minimum SS.

The town I grew up in had a volunteer fire department. I dunno if they still do, but at the time I was living there, there'd been volunteers putting out fires since before the time that George Washington marched through.

It worked pretty well. I don't remember anyone losing their house to fire, even when hurricanes and lightning and thunderstorms hit.

Whenever there was a fire, there were foghorn-like towers all over the town, and the horns would fire off a signal of bursts in a code to tell the volunteers which station to report to or which section of town. I guess in the age of cell phones and iPods, there might be an even more efficient way to dispatch volunteers.

"I believe their (firefighters) first-year salary is around $65K, although it's hard to confirm this."

Matt, It shouldn't be hard to confirm this, it's public information. The figure $160,000 per year is the city's figure for the total cost of the position. Salary, benefits, pension, BUT...

"Do you think firefighters should work overtime for free?"

The figure is a base and DOESN'T include overtime, that's extra.

I have never said that city employees don't do their jobs well. I am questioning where we are going with a transparently unsustainable salary model.

Here's a current example of what we may face soon: The City of San Carlos is considering a proposal as a budgetary possibility to fire the entire police and firefighter force and replace them with San Mateo County Sheriff's Dept. and Cal-Fire personnel. I don't like that idea for our town, but if it comes to it, people should be aware that our leaders already are considering that. They would be irresponsible if they didn't.

I understand why citizens might be upset about public payrolls in lean times.

But these are the people who teach our children and keep us safe. They're not baristas or sales reps, no disrespect to them either.

And speaking of firefighters, the average base salary of a firefighter is far below $100K. I believe their first-year salary is around $65K, although it's hard to confirm this. I think that's not unreasonable for a job that requires a lot of physical strength, usually paramedic training, and oh yeah, risking your life.

You're including overtime and benefits in the numbers you throw out, which I think is not fair. I ask all of you if you know what your "total cost to your employer" is. I'll bet you don't, and I'll wager it's way more than you think it is.

Do you think firefighters should work overtime for free? FYI, that's illegal.

And of the benefits part of the equation, not all of it is pension. Isn't a chunk of it Social Security, Medicare, disability, and unemployment, which all employers pay, public or private?

Then there's vacation time, sick time, health and dental benefits, all of which professional private-sector employees almost always receive as well.

So I'm not denying that pension liabilities are an issue. But I think even if you eliminated municipal pensions altogether, it wouldn't be a budget panacea.

"Disasters not taking place are sometimes a harder sell for a council's accomplishments."

Bankrupt city, multiple personnel lawsuits, massive sewer spills, pervasive deferred maintenance, service cuts, business flight, redevelopment zones gone fallow, no tax base, no credibility. How much disaster do you need?

Thanks for all comments.

If all were well and if the unemployment rate were 4 percent, I don't think there would be much concern about the city's budget. But the fact that there IS deflation in the housing market, thereby reducing the major portion of revenue by which cities get funded, presents an additional problem.

The private sector has been taking it on the chin for a while now. It's inevitable that the public sector will follow to some degree. One suggestion I would make is that the city change who negotiates with the city's bargaining groups. Someone from outside the city could be brought in to sit down and drive the hard bargain that reality demands. But before that happens, we have to see our elected officials wake up and realize they have to do something other than say yes to staff's wishes every time a contract comes up for negotiation.

"If they run again, I can't wait to see how Digre, Vreeland, and Lancelle try to convince voters they deserve to be re-elected."

Disasters not taking place are sometimes a harder sell for a council's accomplishments, but depending on the times and circumstances, that is exactly what is needed.

I am open to new blood. Who you got? I haven't seen any better choices yet.

Ye blind guides, which strain at a gnat, and swallow a camel (Matthew 23:24).

You're right, Todd. I mean, why should council feel the pain?

Bruce, a simple 10% reduction of department heads and senior staff salaries would be equal to well over the cost of 5 city councils.

Right, I want cops and firefighters who earn like maybe $50,000 per year. We should get some top-notch candidates. And for sure, let's cut their pensions; they can make it up in other ways.

Todd asks, "Who makes that kind of money anymore?" Anyone who tries to buy a house, Todd. I earn (on paper, thanks to furloughs, the reality is much less) about $70,000 per year and I do not qualify to buy my own, drastically deflated-price house.

I do question why a Recreation Supervisor makes more than some police/fire positions.

Before I vote to increase taxes on myself, I want to see drastic cuts in the cost of our council. I ask you, who is more important, police and fire or City Council?

DOA. This is what happens when you have a clueless city council that's more concerned with building trails than economic development.

If they run again, I can't wait to see how Digre, Vreeland, and Lancelle try to convince voters they deserve to be re-elected.

For a city our size, the pay/benefit packages are rather high. $100,000 plus salaries for so many is a lot. God bless them all, but who makes that kind of money anymore?

I'd like to see job descriptions of each of the positions (to be potentially cut). I'm sure we Pacificans can assist in determining which positions are absolutely necessary and which can be incorporated into one or two new job descriptions.

Mayor Gavin Newsom sent layoff notices to a huge number of San Francisco employees, then started labor negotiations. Novel idea. Public employment seemed to be more about job security in the old days. Now it seems that many of the government jobs nationwide, statewide, and citywide are fat paychecks with a promise of lifetime employment, then plum retirement benefits. Sounds like France. It would appear that many of the 10 million Americans laid off and unemployed would love the opportunity to take a pay reduction rather than an unemployment check.

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