Putting The Unified Back Into BOUSD.

BOUSD put Measure K on the ballot and all hell broke loose.

Proponents launched “Yes On Measure K” flooding neighborhoods and public thoroughfares with signs, mailboxes with oversized postcards, inserting themselves into our dinner hours with unsolicited robocalls. They hung out on street corners distracting traffic waving signs and passing out flyers, advocated boycotting downtown businesses with ill conceived letters accusing a local developer of buying elected officials and interfering in local politics and created a Facebook page where anyone with opposing views, contrary to the spirit of the first amendment, was blocked.

Opponents launched “No On Measure K” and prominently hung four giant banners and flooded public thoroughfares with signs, attended back-to-school nights and walked neighborhoods handing out flyers, hung out on street corners distracting traffic waving signs and passing out flyers and created a Facebook page challenging every message coming from the opposition.

A self-righteous bunch reactivated their “Reject Negative Politics In Brea” Facebook page and proceeded to attack every No on K sign, banner, flyer or attempt to get their message out. Their pro-K bias was blatant. They continued this masked propaganda until a couple of unattributed third party signs showed up that were truly negative politics. Only then did they suspend activity.

The BOUSD Board of Directors, especially the incumbents running for reelection, were notably silent though state law allows them to support the bond measure on their own time. Neither the Board or district staff conducted or participated in any public forum debating Measure K.

Both sides took to Nextdoor with posts about Measure K that became inflamed with personal attacks, unfounded allegations and unsupported assertions. Comments were repeatedly tagged for review when, as it turned out, the only offense was often the expression of an opposing opinion. Once friendly cyber-neighborhoods sharing coyote sightings, lost puppy alerts and selling used furniture, became bloody battlegrounds pitting neighbor against neighbor.

The “Yes On Measure K” Facebook page has now become “Take Brea Back” and the “No On K” page is now “Brea Watchdogs” – could they be any more divisive?

fb_savebreaTake Brea back from who? From that nasty ol’ developer hell bent on becoming the King of Brea? Exactly how does that benefit our kids or the BOUSD? (Ed Update: 11/29: The facelift continues, suggesting the group is formed “to provide information about local issues, concerns, elections and government activities that affect quality of life in the City of Brea.” – They have extended their ban prohibiting me from posting on their page.

fb_watchdogWatchdogs? Watching who? Watching what? I thought you promised to become part of the solution should Measure K fail to pass. Exactly how does perpetuating an adversarial stance benefit our kids or the BOUSD? (Ed Update: 11/29: Not to be outdone, the “Watchpuppies” group also claims to be an informational resource about local issues, particularly BOUSD. Like their nemesis Take Brea Back, they have also prohibited me from posting on their page.

Yesterday Joe Rollino resigned from the Board. Why? He already announced he would not be seeking reelection in 2018. Did he finish remodeling that beach house earlier than expected? Is there any chance Bill Hall might take the easy way out too?

Would Rod Todd dare apply to fill the vacancy after failing to get reelected? If Jason Kraft and Joseph Covey both apply to fill the vacancy, who does the Board select… the candidate with the most votes? What if a new name gets tossed into the ring?

On par with unfunded pension liabilities, putting the “unified” back into BOUSD is the top priority. Not how many apartments should Hines be entitled to build. Not how to rein in the loose canon on city Council. Not term limits, tiered water rates, parking citations on trash day, where to put a porkchop on a country road, Brea Envisions struggle for relevance or how to preserve those damned hills everyone is so up in arms about.

Its the preservation of Brea’s most valuable assets. Our kids and the BOUSD.

unified BOUSD

 

Brea First: Unfunded Pension Liability

unfunded liabilityUnfunded pension liability was the topic at last night’s Brea First meeting. A very detailed description and analysis was presented by Pete Constant and Truong Bui from the Reason Foundation. When I say detailed, I’m mean deep into the numbers, tiered water rates, where did you get your PhD. sort of detailed.

To their credit, and thanks to a stream of astute and probing questions from the audience, the details provided a backdrop upon which some very down-to-earth discussion emerged. While understanding how we ended up in this hole isn’t without value, finding a way out is the real issue.

A brief history lesson.

In 1999 Council adopted an enhancement of the city’s defined benefit retirement program providing Public Safety personnel with a guaranteed 90% retirement at 30 years of service (Simonoff, Perry, Moore, Daucher yes; Vargas no). This greatly exacerbated Brea’s unfunded liability. Had Brea chosen a defined contribution plan instead we wouldn’t be having this conversation.

In 2000 Brea was overfunded to the tune of $15 million. I’ll let that sink in for a minute. We were ahead of the game by $15 million bucks! Expressed in 2016 dollars, that would be $17+ million – almost three times what we just deposited into our PARS account (Public Agency Retirement Services).

It was downhill from there.

pension liabilityIn 2001 and 2009, coinciding with the two recessions, funding rate for retirement had dropped from an enviable 133% in 2000 to 60% in 2009. Today’s unfunded pension liability, conservatively, is $85 million dollars and market value assets are only 74.9% of what is required.

The $85 million relies upon an overly generous assumed Rate of Return that CalPERS projects to be 7.5%. The average Rate of Return earned by CalPERS investments over the last 15 years is 5.2%. I’m not sure who they’re trying to fool, participants or themselves or both?

Staff has suggested to Council that maintaining an 80% funded level is sufficient. It is not.

That assumption puts all Brea services in jeopardy, including public safety. Further, the $6 million transferred from year end surplus into the PARS account is barely a drop in the bucket. The road to hell is paved with good intentions.

If you’ve ever tried to pay off a credit card relying on making minimum payments, you know exactly how ludicrous this is.

Where the state comes in.

The decades old dinosaur that is CalPERS operates using a very complex set of calculations to determine Rate of Return and Discount Rate. I’ll save you the rocket science, you can find the full reports here if you’re so inclined.

Suffice it to say that CalPERS is systemically malfunctioning and in dire need of a major overhaul. This is the other half of the problem/solution formula. Literally thousands of agencies state wide share in this multi-billion dollar unfunded liability. Public employee pensions are constitutionally guaranteed.

So, no matter what Brea decides to do to fulfill our local responsibility, funding our pension plan, we also have to bring pressure to bear on Sacramento to adopt the constitutional amendments that govern how public pensions are managed.

Joining forces.

I suppose it isn’t out of the question to think cities might band together to lobby Sacramento. Brea keeps a high priced lobbying firm on retainer, other cities must do the same. There is strength in numbers.

League of California CitiesOh, and as longstanding members of the League of California Cities I would think we could turn to them for assistance too. After all, that’s what they do… right, they advocate on behalf of member cities.

But wait, their employees pension plan is CalPERS. Is it possible there is a conflict of interest here?

Where does Brea start?

pension liabilityWe’re in a hole. A deep hole. We need to stop digging and find a way out.

Finding that way out must start with the Council. They need to create a plan to raise our pension funding level from 74.9% to 100%. Not over some protracted length of time. Now. Anything less than 100% adds to our unfunded liability.

Council must commit to a vigorous debt reduction plan, eliminating our unfunded liability.

It’s not as simple as tacking on another half a percent or so sales tax targeted only to pay off the debt. That’s illegal. And we’re not likely to stumble across some windfall and miraculously escape. It will take sacrifice.

City services will be seriously impacted. Public health and safety services will be effected as well. If you thought coping with the drought has been tough, you ain’t seen nothin’ yet.

pension liabilityOkay Council, the ball is in your court. It looks like Brea First is committed to holding you accountable… so am I.

Download PDFs of the Reason Foundation Brea Unfunded Pension Liability Presentation and Report by clicking on the blue links.

Brea First — of the people, for the people and by the people.

My prime objective, from day one, has been to encourage my friends and neighbors to pay more attention to what goes on at the Civic Center and to make the best use of their vote as possible. I’m pleased to share with you the launch of a new grassroots group, Brea First. Their Director, Chris Gaarder has been kind enough to provide this background.

Brea FirstIntroducing Brea First

By Chris Gaarder, Director

Last Thursday, January 28, Brea First hosted our first public meeting, on “Developing Brea: From Oil to Commercial Success.” We believe it is important to look to the city’s past if we hope to build a better future.

Brea FirstOur speakers, former Mayor Carrey Nelson and Olinda Oil Museum docent Jack Smith, shared valuable insights on how Brea became the city it is today. Brea FirstWe heard fascinating anecdotes from the early oil days to the more recent redevelopment efforts that created much of the city we see today.

That was then, this is now.

While it is tempting to say the past is the past, decisions made 10 or 100 years ago have effects that ripple into the Brea of today and the Brea of our children’s future. Brea First will continue to explore Brea’s history in our upcoming meetings, and we hope to put a special focus on the city’s future.

Our plan is to host a monthly public event providing Breans with information and analyses of our past, present and future, from local and outside experts.

All too often, critical issues of local government do not get the attention they deserve. In the coming months and years, Brea First will work at the grassroots level, putting the welfare of the people of Brea first, by shedding light on the matters having the greatest effect upon our daily lives.

By promoting a better understanding of how Brea’s government works today, the people of Brea can help create a better tomorrow.

Counting our blessings.

Brea contributes a tremendous amount of good to those living in the city and beyond, including strong schools, a vibrant business scene, a high quality of life, and strong bonds among the diverse communities within the city.

There remains, however, longstanding issues poorly addressed and still unresolved. Breans voice continuing concerns over transparency, accountability and the proper role of government.

Our most serious problem: unfunded pension liabilities.

The unfunded public pension liabilities owed to the City of Brea’s past and current employees are particularly troubling. According to Pension Tracker, Brea has the second worst unfunded public pension liability per household ($20,113 in 2013) of any city in Orange County.

That puts Brea among the worst five percent of cities for unfunded pension liabilities per household in all of California. The reality is, left unresolved, Brea could face the crippling of vital services or even bankruptcy. Residents, including city workers and retirees, could be hurt by these looming liabilities.

Bad news, good news.

As bad as the unfunded liability may be, there are a variety of other serious issues facing the city. The good news is, as Brea First brings an array of issues to the fore, we can find workable solutions to the challenges facing Brea.

MTG1_overview

Become part of Brea’s Solution.

Plan to hear our February meeting announced in the coming week. Stay connected by visiting our Facebook Page and Website where you can sign up for our email list.

Brea First is a bright light on the horizon.

Brea’s politics has often been contentious in recent years. We all know it. While important change swept through city hall in 2014, serious issues remain.

I have great expectations for Brea First, confidence in the leadership and am hopeful to see it’s ranks grow at an exponential rate. I hope you feel the same encouragement I feel and make an effort to get involved.