Sunday Commentary: Reversing Myself on Sales Tax Measure

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walletBack in February, about a month ago, I came out against the sales tax measure in June.  There were a number of reasons I stated for doing so that I still believe are true.

First, the process was problematic.  Last June, the Davis City Council was told by City Manager Steve Pinkerton of the impending and growing structural deficits.  At that time, there was brief discussion about the need to pursue a tax measure, but for reasons that still do not make a lot of sense, the council really did not start this discussion in earnest until December.

The timeline for placing it on the ballot meant that when the council approved the sales tax on February 11 that was the last possible date to act and still get it on the ballot.  Due to state regulations on taxes, if they missed that timeline, they would have to wait until June of 2016 to proceed.

As we have discussed, the council made after midnight decisions on the “ask” – how much of a sales tax rate we would put on the ballot – as well as the fact that there would not be an advisory measure on the ballot to let the voters express the purpose of the tax increase.

How sloppy was this process?  The ballot language itself was practically unintelligible and after a number of complaints, the council this past week had to spend time to clean up the ballot language.

My bigger concern is not with the sloppiness of the process but the mechanics of it.  The council reduced the tax rate from three-quarters to a half cent.  By going with a revenue measure that only raises about $3.6 million of the needed $5.1 million (which we had all agreed was actually far too low), the council has once again pushed off the discussion and the placement of funds needed for road repair for at least six more months.

This reduces the amount of money going to roads from about $2.5 million to $1 million.  Yet again, maintenance on roads are deferred.

The council believes it will put a parcel tax on the ballot in November to cover those infrastructure needs.  The council has – as Councilmember Lucas Frerichs pointed out – not done any polling.  They somehow believe they can get a revenue measure through with a two-thirds vote requirement after raising the sales tax and after raising water rates.

I have serious concerns as to whether the council is going to be able to get two tax measures passed.  At least had they left the tax rate at 0.75 percent, we would know we will have annually $2.5 million for roads.  That may not really fix the problem, but at least it is sufficient resources to prevent the problem from getting worse.

During the run-up to the tax measure, I made it very clear that my support for the tax measure would heavily depend on the degree to which the council could commit that new revenue generated by the sales tax would go to structural shortfalls and deferred maintenance, rather than to increased employee compensation.

There is a history here, as I have recounted many times – in 2004 the council passed a half-cent sales tax that was supposed to keep parks open and prevent the city from having to lay off city employees.  Somehow, though, the council turned around in 2005 and gave away the store.  The firefighters got a 36% salary increase and other bargaining units got 15 to 18%.

The city has limitations on what they can do with a general use tax.  The city cannot bind itself to spend the money a certain way, because that would require that the vote be two-thirds.

I pushed for the council to reconsider their approach.  They had until March 11 to pull the sales tax measure off the ballot.  I would have preferred their putting it all into a parcel tax where every cent of money could have explicitly been assigned, all the money they needed could have been collected, and they only had to go to the well once.

I got no traction on that and considerable push back.  I can state unequivocally that there is no appetite in City Hall for additional cuts that would be required to postpone the tax from June to November.

In a few weeks, we are going to see the list of cuts if the sales tax measure does not pass.  It will be ugly.  There will be at that point little discussion and no way to avoid huge cuts to services.

As I analyze the situation now, I realize that the perfect solution cannot become the enemy of the lesser of the evils.  I thought we could get a better tax measure if we waited and I still have concerns that two taxes on the ballot will mean that we do not deal with the very troubling problem of roads down the road.

However, as I analyze the situation in an all-cuts scenario, more staff cuts will mean serious reductions in services – especially to parks and city events.  Those may not be core services, but they are part of what make Davis what it is.

I would rather keep the current level of service and take a chance that we can get a second tax passed in November.

My problem was never the sales tax increase per se.  We are still talking a level of tax increase that isn’t going to make much difference to people’s bottom line.  You are talking about an extra half cent on the dollar, an extra five cents on the ten dollars, 50 cents on the $100, $5 on the $1000 and $50 on the $10,000.  Even if you spent $1 million on taxable products in Davis, you are still only talking about $5000 in additional taxes, you’re just not going to notice this.

My worry remains the same, however, in that putting two taxes on the ballot may well mean that we won’t deal with the roads issue down the line.

The roads are a bad issue, but as I noted earlier this week, roads can continue to deteriorate in Davis for another five to seven years before they get to the point where all of the roads look like Olive Drive.

At that point, we just end up like your typical east coast city where only the major arterials get fixed.  We can survive with bad roads.  However, that is not really the ideal scenario.  If we wait too long  to fix them we will never, ever catch up.

We will end up with most of the town looking like Olive Drive.  At the same time, we have plenty of folks driving on Olive Drive.  This isn’t a world-ending scenario, it will just mean that the car repair shops will do quite well.

The bottom line, given what most people in this community want to see, is we need to bite the bullet and put through the sales tax.  As some have suggested to me, the $3.6 million revenue is unlikely to turn into employee compensation increases as it was a decade ago.

Unlike then, we face too large a shortfall of money in the short term and, in the longer term, the sales tax measure is likely to expire.

So, while I still do not like the process – the lack of early discussion and civic engagement with the voters, I plan to hold my nose this June and vote for this emergency tax measure.

—David M. Greenwald reporting

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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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111 thoughts on “Sunday Commentary: Reversing Myself on Sales Tax Measure”

  1. Don Shor

    I suppose this is as good a place as any to note that the city staff has never provided the sales tax data that I requested in 2010, 2012, and again this year. The most recent promises, if I recall, were from Rob White. But I guess they don’t want to provide the data for some reason. I wonder why.

    1. hpierce

      What type of data were you seeking? As I understand it, sales tax data regarding any particular business (or class of business, if someone could reasonably ascertain a particular business, based on its class) is not permitted to be released, and as it was explained to me, for good reason. Let’s say there are two nurseries in town. Owner A could figure out the gross sales of owner B, and use that for business purposes., to the detriment of Owner B. If that’s OK with you, perhaps you are willing to post most, if not all your books on the internet, to share with the public and any actual or potential competitors.

      1. Don Shor

        As noted, I have requested this repeatedly, and been assured that it would be available. I was requesting aggregate data. The Board of Equalization uses retail codes that are general enough that it would not identify specific businesses. More to the point, if they were concerned about what you’re saying here, they shouldn’t have promised repeatedly that the data would be available.

        1. Don Shor

          My most recent concern was that staff (Rob White in the instance I recall) used a single data point of one quarter being lower than the same quarter previous year — in arguing on behalf of the need for broadening our economic base. So my question was: what is the trend in sales tax receipts? I looked through various budget reports, and couldn’t find the information. We need to know, if the voters are being asked to increase the sales tax, what is the current trend in income from taxable sales. Is it tracking with the state as the economy recovers? If it is, then Davis may not be in as dire a fiscal situation short-term as the budget suggests. Pinkerton and staff were using rather conservative sales tax projections (which is good — you want them to be conservative). But without the data, broken down by category, we can’t make an intelligent decision about the sales tax measure. I asked for that information before the council acted on the sales tax measure. If the council didn’t have the data about our current sales tax revenues and reasonable projections, they were making that decision without being fully informed.
          It leads me to the inescapable conclusion that staff does not want you or me or the council to have the actual figures. And I don’t like coming to that conclusion. I have thought they were overworked and gave this little priority. I prefer not to assign ulterior motives to the absence of information. But it’s a glaring trend.
          I don’t know how anyone can say we need the sales tax increase if they don’t know how much money sales tax is generating, in what categories, and what the near-term future is likely to hold in that regard.

        2. hpierce

          Thank you for clarifying what information you seek. I absolutely agree that you should not have been told that the information would be given, if the City had no intent to do so. That is definitely a problem.
          Two suggestions… remember who deceived you, and don’t trust them again. Try to get the info directly from the State Board.

        3. Michelle Millet

          It leads me to the inescapable conclusion that staff does not want you or me or the council to have the actual figures.

          Is there a reason why they would not want us to have these numbers?

          1. David Greenwald Post author

            I get the impression that staff has bitten off more than they can chew. Pinkerton told me in January that he would get that data to me, I think he meant it.

  2. growth issue

    “We are still talking a level of tax increase that isn’t going to make much difference to people’s bottom line. You are talking about an extra half cent on the dollar, an extra five cent on the ten dollars, 50 cent on the $100, $5 on the $1000 and $50 on the $10,000.”

    I always laugh when new taxes or fees are presented this way, that it’s really not going to hurt anyone or
    “it’s only a latte a week”. Well all of these it “isn’t going to make much difference to people’s bottom line” taxes and fees add up to the point where Californians pay the highest taxes in the nation.

    http://portal.kiplinger.com/slideshow/taxes/T054-S001-10-least-tax-friendly-states-in-the-u-s/index.html

      1. growth issue

        I’m sure almost everytime there’s a tax increase it’s presented as a small impact. All those small impacts eventually turn into one big impact on one’s wallet.

    1. Tia Will

      What I have never seen from you GI is what you believe is the “right amount” for us to be taxed.

      If you have not that out, how do you know whether we are being taxed too much, too little, or just the right amount ?
      For example, what do you think California’s ranking for taxation “should be” amongst the states. You don’t seem to like being at the top. What would your goal be ? The bottom ? The half way mark ? What is it worth to live in California vs some other location given the current tax status ?

      1. growth issue

        Ms. Will, I certainly don’t like being the highest taxed, do you? That also tells me that if other states can function with less taxation per citizen what are we doing wrong in California?

        1. Tia Will

          GI

          I honestly don’t know whether I like being at the highest or not. I have never calculated what I consider the “right” amount of tax.

          It may be that we need to pay more to maintain the lifestyle that I have decided is desirable for me. I have lived in four states and in many different communities.

          Davis is by far my favorite and I am willing to pay much more than I currently do to continue living here. Do these other states that you are citing face all the same challenges and have all the same amenities that we enjoy ? I don’t know the answer, but you seem to have decided upon it so I am asking you how you arrived at your decision.

          My point is that I cannot see how we can come to a conclusion about taxation, good, bad, or indifferent without some kind of assessment of what we think is the right amount. That is the question that I am putting to you since you post negatively with regard to taxation on a regular basis.

          1. SouthofDavis

            Tia wrote:

            > It may be that we need to pay more to maintain the
            > lifestyle that I have decided is desirable for me.

            We are actually paying more so the staff can get more in pay and benefits (as Rich has written about).

            How would your “lifestyle” be any different if all the firefighters got paid ~25% less (what the UCD firefighters are paid and more than ~80% of Americans make).

            P.S. And is your “lifestyle” and different now that the city has given ~$1 million to their politically connected friends to “study” public power?

          2. Michelle Millet

            We are actually paying more so the staff can get more in pay and benefits (as Rich has written about

            This statement is ambiguous, Yes we pay more in taxes so that we can pay staff. We could cut their salaries by 50% and still say by not cutting more we are paying them more. Or we could give them a 50% increase in pay and say we are saving money because we did not give them more.

            I’ve asked this question below but I’ll post it again here. Did contracts negotiations result in an increase in staff take home pay?

          3. Rich Rifkin

            MICHELLE: “Did contracts negotiations result in an increase in staff take home pay?”

            Yes. But only by about 6% over 3 years. The thing you need to understand–without making personal attacks against me for stating the facts–is that ‘take home pay’ is only one part of total employee compensation.

            The City of Davis also pays its employees with a very generous medical benefit now worth up to about $23,000 per year per employee. This benefit increased in cost this year by 11.1% over last year. City of Davis revenues are projected to increase by less than 2%. Therein lies the problem.

            The City of Davis also pays its employees with a very generous post-retirement medical benefit. In present value terms, that OPEB can be worth more than one-half million dollars. Note that it not only covers the retiree, it covers the retiree’s spouse and his dependents (with no limit on how many dependents) up to age 26. So imagine a 50 year old retiree who lives to age 93. He will get OPEB for 43 years. His wife, who is 35 when he retires, is also covered as long as her husband lives. And say they have 4 kids, aged 1, 3, 5 and 7. Davis will pay for their medical care for 25, 23, 21 and 19 years respectively. This benefit increased in cost this year by 11.1% over last year for current retirees. It increased even more for future retirees, because actuaries recalculated life expectancy data. City of Davis revenues are projected to increase by less than 2%. Therein lies the problem.

            The City of Davis also pays its employees with a very generous pension benefit. For the $100,000 per year police officer or firefighter, it costs the taxpayers now roughly $25,000 (police) and $28,000 (fire) this year. Those numbers have been going up rapidly. We now expect by 2020 the public safety funding for the City to cost 55% of salary. In other words, our costs will double. It’s not quite as bad for non-safety, but the costs are going up there even more rapidly. City of Davis revenues are projected to increase by less than 2% this year. Therein lies the problem.

            One more thing: I see you are a leader in the Robb Davis for City Council campaign. I know, based on speaking with Robb and many times exchanging emails with him, that your views on labor contracts are not his views, and it is his views which count, in terms of his campaign. That said, since you seem to hate me–or at least you are happy to defame me, without facts, and unwilling to apologize for your vitriolic attacks against me–I suggest you discuss what I have explained to you with Robb. Hopefully, he can screw your head on straight.

          4. Matt Williams

            That said, since you seem to hate me–or at least you are happy to defame me, without facts, and unwilling to apologize for your vitriolic attacks against me.

            Rich, I found your statement above somewhat surprising, since Michelle very clearly and openly has apologized. The link to her apology is https://davisvanguard.org/vanguard-analysis-should-voters-trust-the-council-with-more-money/#comment-219510 and the text of that apology is

            Our city is facing some very serious fiscal challenges. Most people, including myself, do not have the same depth of knowledge regarding these issues as Rich does. My concern with Rich’s article is that a majority of people in this town probably do not possess enough knowledge regarding our fiscal problems to put his assertions into a meaningful context.

            As a relatively uniformed reader what I heard when I read the piece was that city council wants to increase taxes to pay for “fat” salary increases for employees and “cadillac health care plans”.

            From the little I do know, I realized that this was not a completely accurate assessment of the situation.

            I’m concerned that his piece will not lead to meaningful dialogue or solutions. Instead it marginalizes people, pitting tax payer against city employees. I don’t see how this can be beneficially in any way for our community.

            Rich clearly has vast amounts of use knowledge on this subject and is clearly a good resource. Plus I think he has very legitimate and valid concerns.

            What I urge him and others with this type of knowledge to do is express their concerns not in a way that creates divisiveness and distrust but instead in a way that moves our community forward towards solutions.

            I will acknowledge that my statement yesterday did not do this, and I apologize for that. I’m making a concerted effort to keep my dialog on this site productive, and I thank those who help me in this effort by pointing it out to when I don’t.

          5. Rich Rifkin

            Thanks, Matt. I never saw that.

            My partial excuse is that I rode 60 miles on my bike yesterday with a group of old guys who were much faster and better riders than I am. It wore me into the ground. They stopped and waited for me to catch up many times, but they were just too darned fast. I mistakenly thought the average pace was supposed to be 16-18 mph. But they had no problem averaging 21 riding in a crosswind and 25-27 with a tailwind. Uphill (on Cantelow Road), they were awesome. I was the opposite. And compared to most guys, I am not terrible.

          6. SouthofDavis

            Michelle wrote:

            > I’ve asked this question below but I’ll post
            > it again here. Did contracts negotiations
            > result in an increase in staff take home pay?

            And I’ve asked: How many people can retire at 50 with a pension and health care for life?

            I just read that since Vallejo went BK the “average” pension is over $100K (see below) and will probably go BK again. Is it “fair” (can you say “regressive tax”) the many people in Davis trying to make ends meet pay more so many that work in public safety in Davis can retire at 50 and get paid $100K while they relax (or make even more working another job) and the rest of Davis workers can retire when they are a little older making a little less.

            http://money.cnn.com/2014/03/10/pf/vallejo-pensions/

          7. Michelle Millet

            My question is a relative one, after the contract negations are employees bringing home more money, are the paying more into their retirement accounts, has the cafeteria medical insurance buy out amount they receive gone up or down?

          8. Conroy

            Was this one ever answered by anyone? It total compensation more or less now than before the contract negotiations?

          9. Frankly

            How to Become a (Public Pension) Millionaire

            In five states, an average full-career retiree receives a retirement income higher than his final salary.

            Detroit and San Bernardino and Stockton, Calif. are in bankruptcy, and across the country the costs of maintaining pensions for city and state employees more than doubled to nearly $84 billion in 2011 from 2002. Yet the American Federation of State, County and Municipal Employees (Afscme) declares that public pensions are “modest,” noting that its average member “receives a pension of approximately $19,000 per year after a career of public service.”

            The facts don’t agree. Data compiled from all state pensions show that, for employees who spend a career in state government, generous pensions put retired public workers among the highest earners in their state.

            It is true that average public-pension benefits rarely seem extravagant. But these averages are reduced by two groups: older employees who retired many years ago and whose benefits are far less than those of an employee retiring today; and by short-term workers who often receive tiny pensions but almost surely have retirement savings from another job.

            http://online.wsj.com/news/articles/SB10001424052702304360704579415173512940990?KEYWORDS=pensions&mg=reno64-wsj

            Mayor Drops Bid to Put Pensions on California Ballot

            San Jose’s Chuck Reed Retreats After Losing Legal Challenge to the Proposition’s Wording

            The mayor of San Jose, Calif., said on Friday that a group he is leading is ending its effort to place a measure on the California ballot this year that would give jurisdictions the power to renegotiate pension benefits with employees in the public sector.

            The efforts led by Mayor Chuck Reed, a Democrat, were the subject of a Wall Street Journal story on March 11.

            Mr. Reed made the announcement after a state superior court judge in Sacramento on Friday ruled against him and some other local officials in a suit that they filed in February, which challenged the official wording of the proposed initiative used by Attorney General Kamala Harris.

            The suit contends that the Democratic attorney general used “false and misleading words and phrases” in a title and summary for the measure that argue for its defeat.

            Pending the litigation, Mr. Reed’s group had put on hold a drive to gather the 807,000 voter signatures that would be needed by mid-April to qualify the measure for the 2014 ballot. He said Friday that there now wasn’t enough time to gather those signatures.

            http://online.wsj.com/news/articles/SB10001424052702303546204579439710608127186?KEYWORDS=pensions&mg=reno64-wsj

          10. Michelle Millet

            Frankly, our city has important fiscal issues to address. I would like people to have a clear understanding of how their tax dollars are being spent. While this is an interesting article and brings up legitimate concerns, I am seeking answers to questions about how are city has recently made decisions regarding employee compensations packages.

          11. Robin W

            The focus on whether take-home pay changed is misguided. You need to look at the whole package. If take home pay went down $100 a month but employees gained an increase in paid time off with a value of $200 a month, then their compensation package increased. The same is true if, instead of extra paid time off, they now have medical benefits worth an extra $200 a month. Someone actually pays for that, so their compensation package has increased. Employees in the private sector (and in many other public employment jobs) – including many citizens of Davis who are paying for these increased compensation packages for Davis employees – are not seeing these kinds of increases in their own income.

          12. hpierce

            Rich, you also mislead in your example of the retired worker with a spouse and 4 children. The premium paid is the same for a spouse and one, or a spouse and 30. An inconvenient truth?

          13. Rich Rifkin

            HP, I think you are wrong. I believe the City pays for its OPEB based on actual costs. That is why it is twice as expensive to cover the OPEB for someone 65+ than under 65.

            More importantly, I have never once tried to mislead anyone. Your accusing me of doing so is just as wrong as it is when Michelle Millet does so. I may be wrong on something I have said. However, I have never intentionally said anything wrong or ever shaded what I have said in order to mislead. My intentions are honorable. Sadly, the same cannot be said for those who accuse, and even worse for those who accuse while hiding behind a fake name.

          14. hpierce

            Hold on a minute… if the medical insurance rates increased 11 + percent, didn’t half of that come out of the employees’ paychecks? That’s how I recall the most recent contracts provided for. Did that not happen, or are you ignoring some facts to make your point, Mr Rifkin?

          15. Robin W

            Even if that is correct, so what? Those of us who pay for our own health insurance (don’t get it from our employers) pay for 100% of the increases in premiums rates. If city employees have to pay for part of the premium increase that is the same as prices going up in the supermarket.

          16. hpierce

            Ok.. my main point was that Mr Rifkin mislead. If your point is that employees should pay for 100% of medical [or at least 100% of any cost increases], no matter what, fine. I may disagree, but will not argue.

            I have an adult child, whose private sector employer pays for employee only, but thus far picks up premium increases. Is that too generous?

          17. Rich Rifkin

            You are correct. The increase in medical after the first 3% is shared 50-50 (though I am not sure if that applies to DCEA and fire). Still, at 5.5%, that is more than double the new revenues coming into the city on a percentage basis.

          18. DavisBurns

            HP, I think you are wrong. I believe the City pays for its OPEB based on actual costs. That is why it is twice as expensive to cover the OPEB for someone 65+ than under 65.

            I simply so not believe it cost the city more to pay the full cost of a 65 year old’s Medicare supplement which is 20% than it does to pay 100% of a 64 year old’s medical insurance. Our cost at age 65 should go down at least 80% and given the cost of Medicare supplemental insurance, it should be more than 80%.

          19. Matt Williams

            MICHELLE: “Did contracts negotiations result in an increase in staff take home pay?”

            RICH: Yes. But only by about 6% over 3 years. The thing you need to understand–without making personal attacks against me for stating the facts–is that ‘take home pay’ is only one part of total employee compensation.

            The City of Davis also pays its employees with a very generous medical benefit now worth up to about $23,000 per year per employee. This benefit increased in cost this year by 11.1% over last year.

            Rich, I’m going to play a bit of devil’s advocate with your dialogue with Michelle. Just as you criticize her “take-home pay” assessment as too simplistic, it can be reasonably argued that your sliding scale valuation of the medical benefit is too simplistic as well. Public sector and private sector employees (and where applicable their bargaining units) have always valued healthcare in terms of what they receive, not what their employer has to pay. It is very much like an outsourcing agreement, where a “level of service” was long ago defined, and employers simply provided that level of service.

            The DBO contract between CH2MHill and the JPA is the same kind of contract. If the costs for CH2MHill go up, that is a business risk that the “level of service” contract places squarely on their fiscal shoulders.

            With that said, if the JPA decides that it desires a higher level of service than is defined in the DBO contract, then CH2MHill will set a price for that incremental addition, and the JPA will then have to decide if it really wants/needs that increased level of service at the price quoted.

            Unless I have missed something, the City employees have not requested any incremental level of service in the healthcare they receive. On that basis, how is it that you can argue that the level of their healthcare benefits have increased?

            The City of Davis also pays its employees with a very generous post-retirement medical benefit. In present value terms, that OPEB can be worth more than one-half million dollars. Note that it not only covers the retiree, it covers the retiree’s spouse and his dependents (with no limit on how many dependents) up to age 26. So imagine a 50 year old retiree who lives to age 93. He will get OPEB for 43 years. His wife, who is 35 when he retires, is also covered as long as her husband lives. And say they have 4 kids, aged 1, 3, 5 and 7. Davis will pay for their medical care for 25, 23, 21 and 19 years respectively. This benefit increased in cost this year by 11.1% over last year for current retirees. It increased even more for future retirees, because actuaries recalculated life expectancy data. City of Davis revenues are projected to increase by less than 2%. Therein lies the problem.

            Here too you are confusing the benefit, which for the employees is continuing at the same “level of service” and the cost of providing the contractually defined “level of service.”

            That contractual reality doesn’t change the impact of the increased costs on the fiscal health of the City, but increased cost for the City does not mean increased value for the employees.

            The City of Davis also pays its employees with a very generous pension benefit. For the $100,000 per year police officer or firefighter, it costs the taxpayers now roughly $25,000 (police) and $28,000 (fire) this year. Those numbers have been going up rapidly. We now expect by 2020 the public safety funding for the City to cost 55% of salary. In other words, our costs will double. It’s not quite as bad for non-safety, but the costs are going up there even more rapidly. City of Davis revenues are projected to increase by less than 2% this year. Therein lies the problem.

            Indeed, therein lies the problem for the City, but again you are confusing costs with value. The value of the pension benefit has not gone up. it has stayed level.

          20. Michelle Millet

            Matt-I’m not making claims, I don’t know enough about the situation to do so, I’m questioning claims to gain a better understanding of the situation. As I’ve repeated many times, I want the public to make decisions based on an accurate assessment of the city financial situation, I hope others share this goal, regardless of their own positions.

          21. Tia Will

            SouthofDavis

            My life style would probably not be any different based on this study. But one of my children has expressed an interest in coming back to Davis to live and I can foresee how moving to different model of energy might translate into improvements in his and his children’s lifestyles.

  3. Michelle Millet

    The roads are bad issue, but as I noted earlier this week, roads can continue to deteriorate in Davis for another five to seven years before they get to the point where all of the roads look like Olive Drive.

    If it were not for the fact they the roads are going to get a lot more expensive to fix the longer we wait to do so, I’d say, besides main ones, put fixing them on the bottom of our to do list. Given the increases cost associates with waiting I’m not sure this a fiscally wise decision.

      1. Michelle Millet

        Just reiterating it. If the cost weren’t going grow exponentially higher so quickly I’d say let all the roads get as bad as Olive Drive, or worse, before we spend money to fix them.

          1. DavisBurns

            Can someone explain why Olive Drive is a special case? I know PGE replaced gas lines for what seemed like most of last year but I don’t recall the road being in great condition prior to that.

          2. Michelle Millet

            I’m not really familiar with the road conditions on Olive Drive. I can say that Cowell between Drummond and Pole Line have some pretty big pot hole that I regularly avoid. Not sure how it compares to Olive conditions.

          3. hpierce

            Olive Drive is the old “Lincoln Highway” (Route 40) built about a century ago. Modern attempts to ‘maintain’ it were AC overlays of PCC pavement. Not effective due to shifts in the PCC (Portland Cement Concrete) slabs.

            The only true way to improve Olive Drive is to completely tear it out and start over. VERY expensive, particularly for a low volume road.

          4. DavisBurns

            Russell blvd is also the old Lincoln highway but it isn’t in the sorry state of Olive Drive.

          5. hpierce

            Major arterial… many portions of Russell, B & First, have been rebuilt. Olive is basically a local collector (maybe) street. Different.

          6. hpierce

            Besides, the old Lincoln Hwy was two lanes, and mot of Russell was built anew. Don’t think you understand. That’s OK, most people see a line on the map and make assumptions. You are not alone, but your point is kinda an apples/oranges thing.

          7. DavisBurns

            I use both Olive drive and Russell west of town so I know the difference. There are bits of the Old Lincoln highway to be found in many places and where it’s been subsumed by newer roads it has been replaced and/or maintained. Is like to see a traffic counter measure traffic on Olive drive. I’m not sure it should be characterized as low volume. There are lots of high density apartments along there. While reconstruction might be expensive, I think it’s less than a mile long. Traffic would be mitigated by a freeway entrance to westbound lanes at the east end of Olive.

    1. Mark West

      “put fixing them on the bottom of our to do list.”

      This is exactly what the City has done, preferring to increase compensation rather than maintaining the infrastructure. That is why we are facing hundreds of millions in unfunded obligations both for the unsustainable compensation commitments, and for our now failing infrastructure. The idea that anyone still believes this is (or was) a good idea is completely astounding to me.

      Obviously, some still believe that we don’t need to be fiscally responsible today since our children (and great grandchildren) will be here to pay the bills long after we are gone.

      1. Michelle Millet

        This is exactly what the City has done, preferring to increase compensation rather than maintaining the infrastructure.

        I’m not sure if you are referring to the latest rounds of contract negotiations or past ones. I think this statement is an over simplification of what occurred during the most recent rounds.

        Statements have been made that city employees have received increase in compensation. So does that mean that their take home pay checks are bigger?

        1. Mark West

          I don’t see how it matters frankly. The question for the City, and for the tax payers as well, is what can the City afford, not how many widgets can an employee buy this month over last. That is why the conversation is around total compensation (the cost to the City to have employees) not take home pay. It is up to each individual employee to decide if the changes to their individual compensation package allows them to continue with their current job, or if they need to look for another. That is no different from any other employee at any other job and is really none of our business.

          The City cannot afford to have total compensation continue to increase at a rate that is faster than the rate of increase in City revenues, but unfortunately that is exactly what is happening now, and has been happening for the past several years. The best long term option is for us to increase economic development so that the City revenues increase substantially, which incidentally makes the current employee compensation level more affordable. The reality however is that we are not doing any significant economic development, so the entirety of the increase in compensation will need to come from increased taxes.

          1. Michelle Millet

            I think it matters because who is running the city changes. The decisions our current council has made regarding labor negotiaons is very different from the ones made by previous councils. I think people should be made aware of the distinction.

          2. Mark West

            Not really. They slowed the rate of total compensation growth, but they still failed to get us to a sustainable, let alone an affordable, level. You may be correct that this group is slightly less fiscally irresponsible than past CCs, but I’m really not sure that is much of a distinction.

          3. Matt Williams

            Not really. They slowed the rate of total compensation growth, but they still failed to get us to a sustainable, let alone an affordable, level.

            Mark, like Rich you are using the term “compensation growth” as a synonym for “growth in the cost of employee compensation.”

            The City’s cost of providing employee compensation has skyroceted under past Councils and slowed under the current Council, but the actual compensation levels for the employees during “slowing” period of the current Council and City Manager (bringing to an end the “give away” period of prior Councils) has seen virtually no change.

            The level of service provided by the employees’ healthcare benefits is essentially unchanged. The coverage by Kaiser (the default plan for employees I believe) is essentially the same. It is the cost to the City of that unchanged level of service that has grown.

            Actual hourly pay rates (as Rich has pointed out elsewhere in this thread) have only increased an aggregate 6% over 3 years, which is barely higher than the inflation rate.

          4. Tia Will

            “It is up to each individual employee to decide if the changes to their individual compensation package allows them to continue with their current job, or if they need to look for another. That is no different from any other employee at any other job and is really none of our business.”

            I fundamentally disagree that this is none of our business. If it did not matter to “us” as individuals or as a city then it would not be an imperative for us to generate “good paying jobs” or to “grow economically”. These goals are surely based on the idea that enterprises that produce those good paying jobs whether in the private or public sector are what allow people to live in our expensive community and pay for the amenities that many of us want, and make those purchases that allow our local businesses to thrive.

          5. Mark West

            New, high paying private sector jobs bring new wealth into a community. City jobs simply take wealth from the community and redistribute it to the employees. There is no net increase in the communities wealth from high paying City jobs, they just make living in Davis more expensive for everyone else.

            The important discussion on compensation is what can the City afford and given our current fiscal crisis it is clear that we are paying too much to the employees as a group, and will need to reduce total compensation, or at the very least, tie increases to the rate of revenue growth. The incessant hand-wringing over the ‘hit’ that City workers have already taken or what the impact has been on their take home pay is not relevant to the conversation.

    2. Rich Rifkin

      “If it were not for the fact they the roads are going to get a lot more expensive to fix the longer we wait to do so … “

      According to the engineering reports, as the roads deteriorate more and more, the work it will take to repair them will go up appreciably. To my ear, it sounds like the idea that a small fix is cheap, but if we wait, it becomes a large fix, and a large fix takes far more work and materials to repair.

      However, there is no reason or objective data to think that the cost of materials (petrol-based asphalt, concrete, steel, gravel, cement, etc.) or the cost of labor will increase faster than inflation in the years ahead. They might, of course. But they might come down in real dollars. A factor in their prices, beside global demands, is the state of the construction/housing industry in California. If it is soft, the base road-building costs will likely be soft. If, however, we get into another building boom, all construction costs (including road repair costs) will go up in real terms.

      Since we are looking at 25 or so years of repairs, I don’t think it makes sense to hurry up our road repair timetable based on the state of the construction industry. We should, however, move up our timetable if the engineers are correct that waiting will cause the repairs themselves to shift from not-so-big to very big in short order.

  4. Michael Harrington

    Don: need a PRA attorney ? David Greenwald has a good one.

    On the sales tax increase: no changes will be made to employee costs until the tax payers say no to new revenue.

    The water project is bleeding the city dry.

    1. Rich Rifkin

      “The water project is bleeding the city dry.”

      By ‘the city,’ I think Michael means the entire resident population. However, the costs to the City of Davis, while significant, are nowhere close to the problems caused by increasing labor expenses. Over a 5-year period, the City expects its water costs to increase by $2 million. Compared with the increases for OPEB funding, that is small potatoes.

  5. growth issue

    Anyone read the article in the Enterprise about the city’s plan to install the new over $1000 per bin garbage receptacles downtown? Is this a good outlay of money when the city is crying poor and asking us for more taxes?

    1. Robin W

      Lol. I sent a letter to the editor in to the Enterprise about this earlier today. Also the Chamber if Commerce and Downtown Davis pushes for more beautification downtown while we are told that we need a sales tax increase because the fiscal sky is falling. I do not trust the Council or our labor contract negotiators not to waste any increased money that is not earmarked. I will support the parcel tax (which will specify how the funds will be used) but not the increase and extension of the sales tax –not until employee benefits packages are reined in.

  6. Frankly

    If the sales tax measure does not pass, I think the best response should be to close a fire station and force a collaboration with UCD. In terms of service-levels we would end up with the same or similar once all the dust settles and those two agencies merge. I am in favor of this move in any case, but with the sales tax increase failure if I am going to have to select this or other services to cut, closing a fire station and having Davis fire merge with UCD would be the easy pick. The parks, the roads, kids programs, programs for seniors… all of these are higher priorities in my mind. We are fortunate to have the UCD option, most communities do not. We should take full advantage of it if needed.

    And the secondary benefit will be to cut out much of the corrupting political influence from the firefighters union that, ironically, is the primary reason we have severe budget problems.

    1. Tia Will

      Frankly

      I am so happy. We have yet another point of agreement.

      I am very much in favor of an incrementally implanted merger of the UCD and Davis fire departments for the reasons you cited and also as a means to move forward with a more forward looking, proactive role for the “fire department” as a fully integrated “public safety” department such as other communities have developed.

        1. Tia Will

          Franks,

          You know it’s me. If nothing else, you could tell by the nature of my posting error above.

          “I am very much in favor of an incrementally implanted merger of the UCD and Davis fire departments”

          “Implanted” should have read “implemented”. But you know, once a surgeon….always a surgeon.

          Meds

  7. Nancy Price

    “Kick-the-can” and “head in the sand” politics in Davis over road maintenance and repair just mirrors the failure to repair basic infrastructure at the national level. So what’s new?

  8. Homegrown

    I don’t know what this round of contracts did to public safety workers but the lower workers that work on the streets,sewers and water on average take home about $1100.00 less.Next year in July it will be around $1800.00 to 1900.00 cut in take home.

    1. Robin W

      A drop in take-home pay does not necessarily mean a cut in compensation. Did certain tax rates go up? Did the costs of certain things that are paid for through salary deductions increase? I am relatively certain that every employee group in Davis received a salary increase in the most recent set of contracts.

      1. hpierce

        Right… and can an employee spend an increase of medical benefits to pay rent/mortgage/groceries? So if medical costs go up $200/mo, paid by the employee, and their salary goes up $200/mo. that’s a “push”, except the $200 increase is taxed at say 20% (state & Fed). So you’re good with that? But it gets better… if, out of that $200 salary increase, the employee pays an additional 8% for their share of the retirement benefit, AND 3% (or more, if PERS increases the rates) of the employer share, (we have to ensure that City costs are level), where does that leave the employee? I know, that’s the employee’s problem.

        1. Mark West

          How is that different for any other employee at any other job? Why should we be more concerned about the impact on a City employee? What makes their situation special? The City needs to control total compensation. How the control of total compensation impacts an individual employee is something that each employee will have to consider for themselves. Some may find that the job is no longer attractive enough and will move on. Others may need to cut their own expenses to live within their new level of means. Neither situation however is anything that the taxpayers need to be worried about.

      2. Michelle Millet

        A drop in take-home pay does not necessarily mean a cut in compensation.

        Then is it safe to say that a pay raise does not mean a rise in compensation?

        1. SouthofDavis

          Michelle wrote:

          > Then is it safe to say that a pay raise does not mean a rise in compensation?

          I don’t know if you are messing with people or really don’t get it…

          If you get an extra $100 in pay each month, and extra day off every month, a company car, health care for your parents or an extra $1,000 a month when you retire they are all increases in compensation but only one of the four gives you more money in your paycheck every two weeks.

          As a taxpayer I don’t care “what” each employee gets, only “what each employee costs”. The public sector is great at “hiding” what people get paid. When Janet Napolitano was hired to run UC (after happily working for $199K as the director of Homeland Security) the headlines said she will “only” make $570K (that is $170K more than the POTUS), but she also got a $140K for “moving expenses” and $120K for housing allowance EVERY YEAR (it must be tough to find a rental when you “only” make $570K) get an annual “car allowance” of almost $10K and get another $28,500 annually in “special management benefits”. I’m assuming “special management benefits” is where they are hiding that Claremont Country Club membership that Cal has included as perk for top management and coaches for a long time (all the kids I know that grew up in Piedmont learned from their Dads that you need to be nice to UC employees at the club since they will always pick up the tab for dinner and drinks since they never see the bills that go to the UC accounting department)….

        2. Rich Rifkin

          “Then is it safe to say that a pay raise does not (NECESSARILY) mean a rise in compensation?”

          That is correct.

          Take someone who makes $200,000. Say that is composed of the following compensation elements:

          SALARY: $110,000
          OVERTIME: $10,000
          PENSION: $31,000
          MEDICAL: $24,000
          OPEB: $20,000
          OTHER*: $5,000
          TOTAL COMP: $200,000

          Now, let’s say that person got a $5,000 pay raise. Here is how that might not be an increase in compensation:

          SALARY: $115,000
          OVERTIME: $10,000
          PENSION: $35,000
          MEDICAL: $12,000
          OPEB: $15,000
          OTHER*: $5,000
          TOTAL COMP: $192,000

          How is it possible that his medical and OPEB compensation went down? That can happen in a few different ways. For example: The City could cap the benefit at $12,000. So any amount over that would be the responsibility of the employee. And for OPEB, the City could change the contracts, so that it no longer covered dependents. Or it could stop paying the monthly OPEB for future retirees until they reach age 65 (when Medicare kicks in and hence the city’s costs are far lower).
          ————————-
          *Other comp includes life insurance, Medicare costs paid by employer, survivor benefits, etc. It does not include paid vacations, paid holidays or other forms of paid time off. Of course, if Davis reduced the vast amount it pays its employees to not come to work, productivity would rise tremendously. But still, since those do not directly represent cash out, they do not county as compensation for comparison purposes.

          1. hpierce

            yeah, actually all of those components did “count” in the old days when there were ‘comparison’ agencies. No more. Another inconvenient truth?

        3. DavisBurns

          “I believe the City pays for its OPEB based on actual costs. That is why it is twice as expensive to cover the OPEB for someone 65+ than under 65.”

          Medical expenses paid by the city should decrease significantly when the employee reaches 65 and is eligible for Medicare. It that point the city is responsible for the 20% that isn’t covered by Medicare. That is normally done by purchasing a Medicare supplemental insurance policy which is actually much cheaper at age 65 than it is when you’re younger. Please correct me if I’m wrong here but we aren’t paying for full medical insurance for our 65 year old retired employees, are we? We are paying for an insurance policy that covers 20% of their medical costs.

          Also, isn’t there a reduction of the cost of medical insurance as a result of the affordable care act?

    2. SouthofDavis

      Homegrown wrote:

      > on average take home about $1100.00 less

      So about $21/week (I always like when people add zeros to make a number look bigger)…

      P.S. Since unless you see the tax returns of every employee how can you calculate the “take home pay” within $20/week (there is a big difference between the guy that gets a $5K tax return and the guy who owes the IRS $5K because he under withheld and “took home” more than he should have) ?

      1. Michelle Millet

        Regardless of the number of zeros it does not sound like city employees are getting large raises? I claim that has been made many times.

        1. Rich Rifkin

          Employee compensation is going up dramatically. That is why we are in a fiscal crisis.

          The first serious part of the problem began in the mid-1990s, when salaries began to rise year over year at unsustainable rates. These increases, from 1995-2009 were about triple the rate of inflation for our region (though double that for fire and 1.5 times that for police). They were paid for by various tax increases and by one-time revenues from our construction boom.

          The second part of our crisis began shortly thereafter, when medical inflation really took off and has never slowed down. Unlike most private businesses, which regulated its cash costs for medical by either cutting back on the plans it offered, cutting off some benefits going to family members or requiring employees to share in the cost increases, Davis did none of that. Only very recently has the medical cash-out started to be pared back and employees are now paying a share of the increase in medical costs. In recent years, most of this has been paid for by reducing services and not replacing employees who retire.

          The next part of our problem began in 2000 and 2001, when the City began the process of doubling the take home value of its pensions for fire and police, and then a few years later it vastly increased its pensions for other employees. This has been paid for by more tax increases, the loss of jobs and by stopping all regular repairs on our streets and sidewalks and bike paths.

          The OPEB crisis is tied into the medical inflation crisis. It has only shown itself to be a massive problem for us in the last 5 years, as the number of retirees on OPEB has gone up a lot–the exact number of increase I do not know. Also, since 2009, we have been pre funding OPEB (although I do not believe it is even enough to cover our growing OPEB debt, which stands around $60 million, though actuarial reports suggest it may now be much higher). We have been paying for the big increases in OPEB also by cutting back on services.

          1. Matt Williams

            Employee compensation is going up dramatically. That is why we are in a fiscal crisis.

            Rich, your statement above isn’t wholly accurate. The City’s cost of providing employee compensation is indeed going up dramatically, but at the same time the actual compensation levels for the employees is close to level. The level of service provided by their healthcare benefits is essentially unchanged. The coverage by Kaiser (the default plan for employees I believe) is essentially the same, and actual hourly pay rates (as you have pointed out elsewhere in this thread) have only increased an aggregate 6% over 3 years, which is barely higher than the inflation rate.

  9. Michelle Millet

    Robin W The focus on whether take-home pay changed is misguided. You need to look at the whole package.

    I am in 100% agreement with you. We need to look at the entire package. But when I bring up salary I’m told I need to look at total compensation, and when I bring up total compensation I’m told I need or consider retirement etc.

    What I’m trying to figure out is if employees took cuts that will have negative fiscal impacts on them which resulted in the city saving money. I’m not sure how I can ask this question more clearly, but I’ll continue to keep trying.

    1. hpierce

      Both questions are important… what is compensation ‘in real time’ to cover rent/mortgage/medical/food, and what might be a future benefit, unless the promise of that may well be taken away. Your questions are good, but I don’t have definitive answers. For an individual employee at the beginning of their career, seems like the ‘here and now’ is critical. Not so with an employee of 35+ years who ‘sees the finish line’. No simple answers.

      1. Michelle Millet

        I’m beginning to see that there is no simple answer, what I wish is that the information on this topic wasn’t presented in a black/white, good guys vs. bad guy manner. I don’t think it is a simple as some are arguing it to be. Presenting it in such a way leads to divisiveness and misplaced distrust, neither of which are useful when trying to address and education people regrinding the fiscal situation of the city.

        1. DavisBurns

          This doesn’t seem that complicated to me. We had a small business and funded 401Ks and provided medical insurance. Salary is what the employee sees in their paycheck and we can call that base salary. There is a gross, deductions and the net amount and i think we all understand that. Total compensation is the salary AND benefits the employee gets. This includes gross paycheck, medical and dental benefits, retirement plans, vacation, sick leave and holidays. This is what the employee gets but it cost me a lot more to have. As an employer I have to add a multiplier that includes all my expenses. We used 30%. I have to pay FICA, unemployment insurance, retirement workers compensation and probably some other things that have happily been forgotten. These employers costs are not the employees total compensation rather they are what the bureau of labor calls the ECEC or the employer cost of employee compensation. The Department of Labor figures 29.9% for the west. They break the expense into three categories. Legally mandated like FICA, insurance and paid leave and each is about one third of the total.

          1. Jim Frame

            This doesn’t seem that complicated to me. We had a small business and funded 401Ks and provided medical insurance.

            Two big differences supply a healthy dose of complication:

            1. A 401(k) is a defined-contribution plan. You were able to control the amount you contributed to the employee’s account. PERS is a defined-benefit plan, and the city has no certainty about the future pension cost for a given employee. PERS provides actuarial projections, but they can change dramatically over time, which makes budgeting difficult.

            2. You provided medical, but probably not retiree medical, which is part the city benefit package. Projecting these costs is also problematic due to the rapid increase in medical costs that shows no sign of slowing.

          2. DavisBurns

            I understand the difference between a. 401K and a defined benefit plan. I understand the real problem is CalPers was allowed to gamble pension funds in the stock market. When they won big, everyone was happy and increased benefits and lowered retirement ages. CalPers was financially sound when benefits were reasonable and it was illegal to gamble on stocks. Now the toothpaste is out of the tube it’s hard to put it back in the tube.

            You’re correct , we did not pay for retirement healthcare. Why don’t we lobby hard for universal single payer healthcare for all and put this mess behind us?

    2. hpierce

      BTW, to “save the City money”, i.e. a decrease of City costs, employees would need to fully absorb increases in medical, dental, employer contributions to PERS, and have no salary increases, and actually, take a pay cut to boot. Also, no filling of vacant City positions (more duties). Yet it would seem that even with increases in material costs, there are those who want no service reductions, service improvements in some areas. Want fries with that? Employees should be asked to sacrifice further to provide those?

      1. Doby Fleeman

        hpierce,

        I think we all get your points about the impacts of further cuts. What I continue to wonder is why the lack of focus on alternatives and strategies to increase community earnings power, i.e. economic development, as a means to redefine “affordable”. It’s a conversation that contonues to elude our leadership. Hopefully they will see the wisdom of pursuing a larger vision more geared to supporting our true costs of operations.

  10. Homegrown

    The field workers tryed to pay for their own medical four or five years ago but the city wouldn’t go for it.I would think a $1000.00 cut in take home pay is a good cut for a field worker.Its probably 10% to 20% of their pay.

    1. Michelle Millet

      I would think a $1000.00 cut in take home pay is a good cut for a field worker.Its probably 10% to 20% of their pay.

      I am having hard time reconciling statements like this with ones that claim, with no other context, that employees are getting raises.

      1. SouthofDavis

        Michelle wrote:

        > I am having hard time reconciling statements like this with ones that
        > claim, with no other context, that employees are getting raises.

        What I have been trying to find (without any luck) is the “total full time employee costs per year” and the “total full time employees per year” for the city.

        With those numbers we can divide the total paid by the city by the number of total full time employees to see if the average is going up or down.

        If the number was going down I’m sure the city workers would want us to all see this, but since I have tried to find it and can’t I can only guess that the city workers don’t want us to see the number.

        1. Michelle Millet

          What I have been trying to find (without any luck) is the “total full time employee costs per year” and the “total full time employees per year” for the city. If the number was going down I’m sure the city workers would want us to all see this, but since I have tried to find it and can’t I can only guess that the city workers don’t want us to see the number.

          Are you sure employees have access to this information?

  11. DavisBurns

    Here is a link to sacramento road maintenance info http://www.sacog.org/mtp/pdf/MTP2035/Issue%20Papers/Road%20Maintenance.pdf
    Basically, they say it costs 4 times more to rehabilitate a mile of road than to maintain it and 10 times more for major reconstruction. Preventative maintenance is key to controlling costs but the only funds available for that are the cities share of the gas sales tax, other sales tax or the general fund. At a meeting where Pinkerton explained some of the challenges to the city budget, I heard him say the state was no longer sharing any portion of the gas sales tax with the cities which I think is 6 cents out of the total of 18 cents. This seems crazy, maybe I misheard but I wasn’t able to follow up for clarification. He also said Davis collects about 61% from sales tax than comparable cities our size.

    ” Deferred maintenance drives up long term cost; it shortens the cycle for rehabilitation, which is four times as costly. Deferred rehabilitation compounds the problem, often leading to pavement failure and the need to reconstruct the whole roadbed, at ten times the cost.
    Routine preventive maintenance, particularly to seal cracks, patch potholes, and keep drains open, on a continuing basis takes on average of $20,000 per mile of road per year to do right.”
    “Regular heavy maintenance, meaning a slurry or chip seal coat, adds costs in the range of $50,000-$80,000 per mile for residential streets, on about a seven year cycle.
    For well-maintained roads, the pavement rehabilitation cycle, meaning an asphalt overlay, comes due in 15 years for arterials and 30 years for local streets, costing $300,000-$400,000 per mile; rubberized asphalt can last longer and cuts road noise but costs about 25% more up front.
    Reconstruction of poorly-maintained roads, which entails removing the pavement and repairing the gravel base underneath, costs as much as $2 million per mile.”

    The bottom line is cities are up a creek since 1979 and Prop 13 but we all know that. I keep asking myself why someone doesn’t propose we repeal Prop 13 since it has beggered local governments or failing that, repeal the portion that applies to business property tax and keep the homeowners portion.

    1. SouthofDavis

      Homegrown wrote:

      > The field workers numbers went down but people keep talking
      > about the fire fighters and the upper people at city hall.

      I think that most taxpayers would like to see the low paid people actually doing the work get paid more and the high paid people “managing” things get paid less…

      As Michelle says this is not “black/white, good guys vs. bad guys” it is what do we need to do now to keep things going.

      As DavisBurns points out putting off road maintenance results in problems down the road and putting off pension maintenance (aka the continual underfunding) will results in big problems down the road.

      The retired workers are the ones that will take the biggest hit in a BK (everyone should look to Detroit to see the future) when the court says you get half of what you thought you were going to get.

  12. DavisBurns

    As I understand it, our biggest problem right now is the OPEB funding and that is a crisis because the rules for funding it have changed. In the past cities were allowed to pay as you go. Now we are required to prefund part of the liability or pay it down. Can we stop beating up previous councils and city employees? The rules changed, the economy tanked and we have to figure out how to make difficult choices. Some of the most obvious options may not be legal like raising the retirement age to 65 and not paying medical before retirement to people we don’t employ but if we went bankrupt they’d lose their medical benefits just the same.

    We need to rethink everything about public safety workers. It’s not as dangerous as they’d like us to believe. Here are mortality rates per 100,000

    Policemen: 16.8
    Firefighters: 16.6
    Men: 6.9
    Women: 0.7
    Farmers and Ranchers: 37.2
    Grounds Maintenance Workers: 13.5
    Fishers and related Fishing Workers: 147.2
    Construction Laborers: 21.4
    Roofers: 33.5
    Structural Iron and Steel Workers: 61
    Operating Engineers and other Equipment Operators: 18.2
    Aircraft Pilots and Flight Engineers: 90.4
    Refuse and Recyclable Material Collectors: 40.7
    Logging: 87.4
    Mining: 28.1
    Taxi and limousine drivers: 22.1
    Truck Transportation: 27.2

    Retiring at 50 should not be possible. I like to start with the basics.

    1. hpierce

      Well, you make a good point… if ALL retirement benefits, PERS, STRS, SS were designed so that no one could take benefits until they were, say 85, we’d be able to cut all sorts of costs. Sounds like a plan. Of course, we’d have to make sure that spouses could neither claim benefits until they were 85… if they make it.

    2. Frankly

      And related to this… firefighting has gotten less and less dangerous, and the risk of structure fires have dropped precipitously.

      And the reason is due to improvements in construction materials, and enhanced building codes in consideration of fire risk.

      For example, I have had home inspections for remodel work and in each one the inspector wanted to confirm that all the smoke detectors were installed and working.

      Also, firefighter equipment has improved. And there are Cal OSHA and other rules that have advanced to help prevent injury to firefighters.

      Another consideration… all of the increased fire prevention benefit has come at higher costs. It is more expensive to build a home today for a number of reasons including all the code requirements for fire prevention.

      So, we are taxed to make it safer for us and for firefighters with respect to fire risk, and at the same time we have been increasing the pay and benefits for firefighters to astronomical levels and many keep justifying it by saying that the job is dangerous. As DavisBurns points out, it is not really a dangerous job compared to many, many others. And when we look at Davis compared to all other firefighter jurisdictions it must be on the very low side of risk for injury or death.

      So, if we are really going to justify compensation of firefighters based on the danger inherent in their work, Davis firefighters should be paid significantly less.

  13. Tia Will

    “We need to rethink everything about public safety workers. It’s not as dangerous as they’d like us to believe. Here are mortality rates per 100,000”

    I agree that we need to rethink retirement age for public safety workers. However, “mortality rate” actually has very little to do with this consideration. Rather than how likely one is to die on the job, a more valid consideration is what is their suitability for remaining on the job. A couple of examples to make my point.

    First let’s look at logging or lumberjacks as we called them in the Pacific Northwest when I was growing up.
    This is a job that has both a high mortality rate, but also has extreme physical demands in terms of mental alertness, physical strength, stamina, and agility. Since these tend to decline with age, an earlier retirement age is probably warranted not only for the safety of the individual but also his coworkers.

    Now let’s take OB/GYN. Here the mortality rate is virtually zero. However, there is a very high need for mental alertness, rapid decision making, ability to reassess priorities at a moments notice, mental and physical stamina, and manual dexterity. These are also subject to decline with aging as I can attest and warrant either the ability for early retirement or the ability to “wind down” one’s career in terms of duties to office practice and/or administration only not to benefit the individual physician but rather for patient safety.

    Although I do not have the ability to do such a breakdown for public safety workers, my point is to demonstrate that mortality rate alone is too simplistic a measure to use to decide on the most appropriate retirement ago.

    1. Jim Frame

      Since these tend to decline with age, an earlier retirement age is probably warranted not only for the safety of the individual but also his coworkers.

      By this logic, professional football players should be eligible for full retirement benefits around age 35.

      In my opinion, any early retirement scenario for a given class of workers should take into consideration the ability to retrain for another occupation. It’s not reasonable to ask the taxpayers to support relatively young people for half their lives in retirement.

  14. Tia Will

    Jim Frame

    There are actually two separate issues here. One is the issue of retirement age. The other is the issue of whether or not it is reasonable to anticipate that someone will be able to do the same job as well in their older years as they did in their youth.
    I agree that retraining should be a possible consideration. My point was not that this should be the only consideration, but rather to emphasize that retirement considerations should of course be multifactorial and not based solely on mortality, or any other single factor.

    I personally am deeply grateful for and appreciative of the Kaiser policy that allows doctors in very demanding specialties to opt out of hospital medicine and assume other less physically taxing activities after a given age and number of years of service. Nurses also will often “age out” of more demanding roles such as Intensive Care units,
    Labor and Delivery, and the ER and move into clinic or administrative positions. I feel that not only for the sake of the individual worker, but often for those dependent upon his/her performance, retraining, or some other form of societal contribution would be appropriate. For instance, while I no longer train medical students and residents in the hospital, I have taken on additional clinic teaching. I am sure that many jobs have related services that could be provided by those who no longer are at the top of their physical game .

    1. Frankly

      When social security was enacted the retirement age was set to 65. That was the current life expectancy of males at the time.

      What a nation of entitled, whining, wimps we have become. Our life expectancy is now nearing 90 years, and we say we can’t work as many years as when the expectation was that we would work until we died at age 65.

      We should all work until we are 65 at least unless we have serious and debilitating health problems. Some of us might be able to work until 70 or 75. We have had US senators work until they were 90.

      This demand that we retire early and that our retirement be paid for by taxpayers is absurd. It is the main problem and fixing it is the main solution.

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