Brea Matters has been purposefully silent since the new Council was seated. Operation Clean Sweep left many exhausted and in need of a little peace and quiet for a change. Now that Council is settling in… I’ve turned my attention to money matters, our largest and most threatening issues.
Unfunded Pension Liabilities was a widely used campaign buzzword. Though some attempts have been made to rein in it’s almost exponential rate of growth, Brea remains strangled by debt.
I made a list of financial topics to investigate and my initial inquires uncovered a maze of interrelated issues.
Revenue Over Expense, a smoking gun?
Forever I guess, Brea’s P&L (Profit and Loss) statement has concluded with Revenue Over Expense… which has been treated like free money. Honestly, I’d never noticed it before. I am familiar with the myth of free money however.
Every year, Council and staff announce, with much back patting and fanfare, that a balanced budget has been reached. However, try as I might, I can’t remember ever hearing mention of these leftovers.
Typically, I’m told, this money has been put into FARP (Fixed Asset RePlacement Fund). How much has gone into the fund, how FARP spent the money and how big this Revenue Over Expenses might be is still a mystery. I’ll keep digging, we deserve to better understand how our money is being managed.
Do not pass GO, do not collect $200 dollars.
At an upcoming Council meeting (I’ll give you a heads-up) staff will, for the first time, suggest splitting the reallocation of Revenue Over Expenses. The plan, I’m told, would reduce the FARP allocation to 90% and 10% would go to Fund 150.
Also known as the OPEB (Other Post Employment Benefits) Fund, OPEB pays for retired employee medical coverage (previously unfunded) plus current employee premiums. The unfunded debt is $16 million. This is the mystery component not generally mentioned in discussions on Unfunded Pension Liability which is now an additional $70 million. Don’t look for a calculator, that’s $86 million and growing.
Roy Moore, in his independent analysis and public presentation on our Unfunded Pension problem a couple of years ago, did include OPEB in his audit and projections. Sadly, neither Council or staff at the time allowed Roy’s efforts to gain any traction.
Bank error in your favor, collect $200 dollars.
Well, if we can fold OPEB into the mix, what about Unfunded Pension Debt? What about repaying the 560 Fund the $1.4 million borrowed to make solar payments? Could we tap Revenue Over Expense for a little money to put drought tolerant landscaping at the Civic Center?
Opening this can of worms opens a lot of questions. I’m confident Council, especially if they seek answers publicly, where we can wade in with our comments and suggestions, will make the sort of policy changes needed.
Doubling up payments to CalPERS makes perfect sense, why hasn’t this been done already? The 560 Fund should never have been tapped to pay for a solar project that was sold, in part, on the basis that it would pay for itself. Why has there never been an audit of this project, framed in terms that all could easily understand?
Defining, once and for all, the proper use of the 560 Fund, conducting audits of O’Donnell’s Fire Department reorganizations and accurately calculating the ROI on the solar energy project have been systematically kept off calendar and away from public input. Why? What are they trying to hide?
Drought garden planted the seeds of public distrust.
The original drought garden, jammed through at the last minute and without considering public input, was a poorly designed masquerade to avoid spending proper funds on a public works project. The story leaked to the public, objections and outrage could be heard from all sides, the Mayor was counseled to postpone discussion and refused.
Today’s Council has a win-win opportunity to bring the “Rock” Garden back for further discussion. Here’s a chance to reverse a major blunder of it’s predecessors, to be honest with the public and clear the air, once and for all.
First, admit that repairing the leak in the Civic Center parking structure and avoiding spending Building Maintenance funds on it was the real objective. Put a standalone item on the agenda for a Public Works project to fix the leak. Pay for it with the Building Maintenance fund.
Put a second item on the agenda to put drought tolerant landscape on the effected area once repairs have been completed. Tap MWDOC for their sod removal subsidy and Cal Domestic for the promised grant. That’s $17,500 in the bank. Allocate another $17,500 from Revenue Over Expenses. Boom! The budget is now only $35 thousand dollars, not the quarter million as originally stated. Invite CSUF grad students to do the design.
Please, it’s a business, not a board game.
The City Manager has often characterized himself as the CEO of a large corporation as justification for his salary package — twice that of California’s Governor.
Okay, it’s time to start running this city like a real business instead of a board game.
Start trapping all expenses against all projects and programs. No More soft costs. No more robbing Peter to pay Paul. No more hiding special interest projects by calling them something they’re not.
Every time accounting principles are pushed to their limits the door is opened to slip the difference into Revenue Over Expense.
The ball’s in your court now.
Thanks to Operation Clean Sweep and a voting population interested in rebooting City Council, we now have five Council members with open door policies, offering greater transparency and accountability in government and dedicated to fostering meaningful community engagement. Let’s not waste it.
The time to stand up and be counted is now.
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Of course you can always come share your thoughts at Council meetings during Matters From The Audience. Check the Council’s agenda on the city’s website so you know what’s coming up. You’re not limited to commenting only on agenda items. Something bugging you? Speak up. Don’t be afraid to ask Council to pull an item from the Consent Calendar for discussion or to move a discussion item from the Study Session to the formal meeting in Council Chambers.
I’d be remiss if I didn’t encourage you to send positive vibes their way too. Council is a big commitment. It’s hard work. It shouldn’t be a thankless job. We have a winning team now, there’s nothing wrong with showing a little team spirit and cheering them on.
Oh, and in the unlikely event you’re one of those who didn’t vote… never mind.