Tuesday, May 11, 2010

Substantially Equal and Substantially Secret?

Written by; Just Wondering
A hearing was held this morning, May 11, 2010, in Department 65 regarding San Diego City Attorney Jan Goldsmith’s new litigation against SDCERS. This new theory, “Substantially Equal”, is designed to attack your pension benefits and relieve the city of its financial responsibility. Goldsmith believes SD Charter Section 143 requires you to pay for a substantially equal portion of SDCERS investment losses even though the City, the plan’s sponsor, has paid for those losses, when they have occurred, since the inception of the system. In addition to the issue of losses, Goldsmith suggest that System profits, ones made six out the last ten years are not yours to share on an equal basis. No those should be negotiated via the meet and confer processes. More on this later.

Why was this hearing held in Chambers

A funny thing happened today, the hearing, which was more about scheduling than anything else was held in chambers, NOT in open court. No one but the City’s three attorneys, Elaine Reagan, SDCERS’ general counsel, Judge Lewis and a court reporter were present. We can only speculate as for the reasons for a private hearing in chambers. I can report Ms. Reagan, was surprised when Brian Marvel told her the hearing would be held in chambers out of the public’s view. Marvel, who was there to observe on behalf of the POA, was, himself surprised when the Judge’s bailiff, informed him the hearing would be in chambers. As to who wanted this hearing held in private we can surmise it was the Plaintiff, Jan Goldsmith, or the City, not SDCERS by Ms. Reagan’s reaction to the news it would not be held in open court.

At the end of the hearing Judge Lewis denied the City’s request for an expedited hearing. The City sought a June 28th hearing date, claiming the City will be irreparably harmed if it is forced to pay its full required contribution, the actuarially required contribution or ARC of $231 million dollars. Goldsmith’s deputies argued they could save $40 million dollars. What they really want permanently shift the responsibility for investment losses onto your back and for you to pay the $40 million under their substantially equal theory. Some say this amount is about $4,000 for each current City employee.

So what does this mean for now?

With Judge Lewis’s denial, the City will be responsible for the payment. But the City is NOT require to pay the full amount, 231 million on July 1st, they can, if they choose, delay it or make installment payments, according the Mark Sullivan, SDCERS Board President, who was also present in the courtroom, but not part of the hearing in chambers. The installment or delayed payment option has always been available to city, but just like your mortgage, or personal credit cards, if you choose to delay or spread the payments over time, interest accrues increasing the overall cost.

The next hearing on this matter is scheduled for July 16, 2010 at 0830. This could change as the parties strategize for tactical advantage or others, such as the POA or MEA decide whether they want to join in on the litigation.

Danger WILL ROBINSON… Danger

Remember I mentioned substantially equal sharing of investment gains. Goldsmith suggests gains are not part of his “substantially equal contribution” argument. He’s said they should be the discussed in the meet and confer. But how would that work, especially in years where labor groups and the City reach multi-year contracts and no meet and confers are scheduled?

Here’s another warning about “gains”. Remember Proposition B? Overwhelmingly passed by the voters it mandates a vote of the electorate to approve any enhancement to pension benefits. In fact the City Attorney’s own in partial analysis says, in part, “The ballot question states that voter approval is required for “any increases.” The text of the measure states that increases in benefits due to cost of living adjustments would not require a vote of the electorate.”

Any number of arguments can be made that sharing investment gains, and lowering your required contribution to the system could be viewed as a pension enhancement. Thus requiring a vote of the people. Do you really think San Diego will pass anything, yes ANYTHING, that even remotely sounds like it improve your pension? If you do, I have a bridge and waterfront property for sale at a good price and I’m looking to unload it.

Sunday, May 9, 2010

Proposition D

In June city voters will be asked to make permanent the change from a City Manager style of government to a "Strong Mayor" form. In 2004 voters approved a trial period of this new form of government. Some will say it has been a success while others (me included) believe it has been a dismal failure. The leading supporter of Proposition D is none other than the little rube. He has been pushing this proposition for almost a year now and his arguments to support are shallow at best. His web site titled: "accountabilityatcityhall" provides his spin for support of making this trial permanent.

Those of us who have watched the mayor perform his role in this new system take a different view of reality. The League of Women Voters of San Diego has put forth the best argument I have seen against Proposition D. I spent an excessive amount of time reading the proposition and all of the arguments in support and opposed. The arguments in support seem to paint a picture of a better way because the old way so to speak is what got us in the trouble we are in. This is simply not true.

The last five plus years of governance under the "Strong Mayor" has proved to be more dictatorial than anything else. The mayor chooses to ignore city council meeting unless he is demanding something. He does not participate in the meetings of the council and gives off the appearance of indifference to their role and if they dare speak out against him or his idea god forbid. The ability of the council to legislate has turned into a battle of will and wit. It is about power and ego. The mayor wielding all the power and projecting all the ego.

The mayor should be the leader of the council. He should be at every meeting of the council and participate in the discussions and held accountable to the public as such.  There is no avenue for open debate with the strong mayor form of government because the mayor in the present form does not have to listen to the public or take their input. The council is required to do so and the mayor can ignore it.

We cannot afford to continue this failed trial of governance. I would urge you all to tell friends and family to VOTE NO on Proposition D. It is time to restore the city to a form of governance that makes sense.

Time Away from Writing

I want to thank "Just Wondering" for taking up the slack and writing a couple of posts for me while I was away. I appreciate the comments from people asking about the blog and when I would post again. Trying to write on a regular basis had taken on a life of its own. In all honesty I felt myself becoming caustic and so negative, the writing was no longer an outlet for frustration or anger but a vise to in some way justify my rants. I have such little time left before I fully retire, I did not want to leave with the label "Disgruntled" and decided to take a break and re-think what I was trying to accomplish.

I have tried to write informative pieces, pointing out differing views of what the mainstream press was feeding the public. I tried in some way to shed light on the actions of elected politicians and their complete disregard for honest, ethical practices. I tried to ensure my pieces were factual and accurate and at the same time provide information allowing others to form their own opinions.

Management and those at city hall were not fans of my writing. But many who worked for the city began to send me ideas for stories and information on the actions of management and the politicians. I said what many would think but feared saying out loud. I said things that I knew to be true and many did not want said. But I began to struggle with saying what I wanted to say at the same time saying it in a manner that would not be offensive. My first couple of rants on this blog were edited after posting to remove inappropriate language and personal attacks on individuals. This was done in an attempt to lend credibility to the content and message as well as not to offend those who may read my blog. I was having trouble doing that more and more.

Sometimes what is important changes as we move through life. What is important in my life has changed and I struggle to make sense of it all. As I do this, I will try and write more often. My next post will deal with Prop D, followed by one about the City Attorney's interpretation of "Substantially Equal" and his ill-advised law suit aimed at SDCERS regarding this issue. I am also planning an election rant about the candidates and other initiatives. My time working for this City and the department is fast coming to an end and I want the end to be in some way a positive memory and not one that might be described as disgruntled. I still very much enjoy what I do and would prefer to finish my career right where I am. This may not happen but if given a choice that would be my wish.

Happy Mother's Day to all of the mothers out there.