Monday, March 8, 2010

Pigs Flying in San Diego

Just to clarify the title of today's post; the pig was wearing lipstick and I saw it fly by my window at Headquarters around 1415 hours headed south west. I know some of you are thinking that maybe it's the oxycodone talking and right now it could be, but around two o'clock today my phone went off and I started reading a string of tweets from Twitter. The first in the string came from Lani Lutar of the San Diego County Taxpayers Association who said she was "at City Hall listening to pension presentation by actuary together with April Boling and Bill Sheffler." The next message posted by Ms. Lutar said, "This is huge. RT @dillonliam: goldsmith: employees could be on the hook for investment losses ." I quickly followed the link that Ms. Lutar provided in her tweet and it led me to the Voice of San Diego and an article written by Dillon Liam, that had city attorney, Jan Goldsmith, wondering if city employees should share some of the investment risk with taxpayers in the employees pension system.

After quickly reading Liam's article, I responded to Ms. Lutar's tweet by saying, "I saw a pig fly by my window this afternoon and thought I was seeing things. It had lipstick on too. Get real." My tweet went to Ms. Lutar and Dillon Liam to which Liam responded, "talk to Mr. Goldsmith and watch the meeting going on now." The meeting Liam was referring to was a City Council meeting where the city attorney was again providing one of his famous or infamous legal opinions, regarding  the charter's requirement that the city and its employees contribute a "substantially equal" amount of certain pension costs. I quickly replied to Liam's tweet, "no need to Liam... the law does not support his Alice in Wonderland ideas. Do your own research for heaven's sake."

One of the major difficulties facing the City of San Diego besides incompetence, ignorance, lack of institutional knowledge, the inability or refusal to investigate and understand the history behind past actions, is the fact voters in this town seem to elect complete dolts. I wonder how many of the elected officials in this town have aluminum foil covering their windows. I find it absolutely pathetic that a person in the position Jan Goldsmith holds, would sit on the dais at a city Council meeting, in the eighth largest city in America, and make such statements. (The attorney representing SDCERS disagrees with this analisis and opinion)

If this was not such a serious issue, it would be comical from the perspective that you have two, purportedly intelligent, college-educated, legal professionals, reviewing the same language from a section in the charter and yet their "legal opinions" are so diametrically opposed it is hard to believe they are offering an opinion on the same topic. Why? Politics or ignorance? Incompetence? I did try to get a better look at that pig this afternoon, I wanted to know if it was male or female, but it turned and flew away so fast I missed it.

I'm sure there's going to be more on this issue in the very near future and I can't wait to see how many jump on the bandwagon before the wheels fall off. So far we've got Liam at the Voice of San Diego; Ms. Lutar and the San Diego County Taxpayers Association; the little rube no doubt has his dancing shoes on and party favors bouncing off the ceiling at home; and don't dismiss the mayor, who is no doubt sitting in his office with his feet on the desk, and that supercilious look he always wears, thrusting his fist in the air saying "You go Jan."

Time to apply ice to my hand and take another mind altering drug and drift off to sleep. Oh what will San Diego and our elected band of fools bring us tomorrow?


Anonymous said...

Hey Sparkles, in good years will the City share the additional profits with the employees? If the City hadn't essentially stole money by underfunding the pension system, they wouldn't be so far behind.

Just Wondering said...

Why is the City moving documents?

Yesterday's revelation by City Attorney Jan Goldsmith was covered by Voice of San Diego. In their article they posted a link to SDCERS' General Counsel, Attorney Elaine Reagan response. I posted that link in my comments yesterday.

This morning the link was broken and the document unavailable. So why is the City attempting to hide responses to Mr. Goldsmith's NEW ATTACK on your pension benefits?

I searched high and low, the link in the VOSD article was also broken. There was nothing on SDCERS' website. But with a little diligence I found it at the City Clerk's website. So once again, Here is the new link! It is a PDF document and 30 pages long.

So here's a brief summary. The first item of note is Mr. Goldsmith's omission of the phrase "...but shall not be required to contribute in excess of that amount...".
Ms. Reagan uses this as her first slide in her presentation to Council as she puts forth Charter section 143. This of course raises the question, why would Goldsmith chose to exclude that important phrase from his statement to Council? Is this good lawyering or just political spin? Didn't Goldsmith tell us that Aguirre type spin had no place in the City Attorney's Office?

Ms. Reagan continues through the next 27 pages laying out the institutional history of SDCERS and the statutory and administrative regulation that control it. On one page she highlights information about the infamous underfunding by the City.

UAL [or unfunded actuarial liability] (Experience and investment losses and past service
liabilities) [are] excluded from equal contribution requirement

[The] City [is] obligated to pay 100% of the UAL

She goes on to define what "Substantially Equal" means as defined by the courts, citing published case law to support the SDCERS position. She says,

"Substantially equal does not mean exactly the same, identical, equal or 50-50.
It does mean “nearly” or “essentially”, “sufficient”, “adequate”, “enough”, “as much as may be necessary”, “a quantity or scope that meets the demands of a specific situation” or “adequate to the end proposed”

Who sets the contribution rates?
According to Ms. Reagan's presentation: Funding obligations of the City are determined by the Board, with the advice of its actuary [per] City Charter section 143 [and under] San Diego Municipal Code section 24.0801.

The [SDCERS] Board sets the contribution rates for Members which, if arrived at in good faith,
are conclusive and become part of the plan document.

There is quite a bit more historical documentation presented to support SDCERS' position.

As always, Sparky has hit the nail on the head, and not his injured finger, when he points out the lack of institutional knowledge has become an anchor around the neck of this City Attorney. If he had taken the time to do some basic research before coming forth with this ill conceived postulation he could have saved himself the future embarrassment of having to back away from this position.

There will be an April SDCERS Board Meeting where more input will be taken on this matter. There is no better time that NOW to become involved in the fight to protect the pension benefits you have rightfully earned.

Just Wondering said...

Fair and Balanced?

Yesterday, Mr. Goldsmith answered some questions regarding his opinion about the Pension System's debt. He says he came up with this idea after Elaine Regan's presentation to the Council. The underlying message is he believes SDCERS wields too much power. He says it’s his job to determine what the Charter means. Here's part of his statement:

The system was interpreting the charter "very narrowly" and could be shutting off the city's ability to negotiate higher employee contributions to the pension fund.
"That's not [SDCERS] role. That's destructive and they ought not do that."
The charter, he added, does not prohibit city employees from paying investment losses.
"There is nothing specifically that says investment losses are the risk -- or the underlying assumptions -- are the risk of the city," he said..

So what do the employees of the City of San Diego end up with; two attorneys with opinions at opposite poles, one positive for us, the other negative!

To be fair, here's the link to Goldsmith's presentation to read for yourself. Goldsmith's Presentation to the Council!
There were interesting reactions from Council members as reported in the VoSD article:

"Council reaction to Goldsmith's opinion ranged from giddy in the form of pension hawk Councilman Carl DeMaio to those that were more wary.

Councilmen Kevin Faulconer and Todd Gloria warned of legal bills should the city have another courtroom dispute with the retirement system because the city ultimately pays all those costs.

Councilman Tony Young was concerned about the city attracting qualified employees should city officials decimate the retirement package."

So what happens next? Well Goldsmith already said the following:

Goldsmith said, he plans to take as much as "several months" before determining his opinion on the issue. That opinion might not be public because there could be a lawsuit. "There's a potential of litigation," at some point, we have to consider that and if we consider the litigation route [the opinion] will probably not be made public. At this point, I can't say. At this point, I want to hear them out."

A meeting is planned between Goldsmith and Regan to discuss the issue.

But here's something very interesting...

Former SDCERS Board Member William Sheffler, an actuary by profession, offered this comment.
"Unlike his predecessor Jan [Goldsmith] has a reasoned argument. [...]SDCERS has a history of making key decisions on cost allocation without the plan sponsors input. However, the city abdicated those responsibilities by not acting. The city is now acting, and their past neglect doesn't prevent them from setting the record straight. The council may have to pass ordinances tho to perfect their positions, and that could raise 'meet-and-confer' issues. The current problem is just another housekeeping matter that has been neglected for years."
For reasons that are not clear Mayor Sanders did not reappoint Mr. Sheffler to the Board when his term expired. Sparky wrote about this in a previous blog on Friday, May 1, 2009!

So what does this all mean? More uncertainty about your future, more legal bills for the City and Taxpayers. (Remember the City is responsible for both side's legal cost on issues like this.) and more of Mr. Toad's Wild Pension ride.