Malfeasance: Brea’s Status Quo?

In the weeks ahead, breaking news regarding several cases of fiscal misconduct will be finding their way into public discussion. The egregious nature of several will likely lead to widespread use of the term malfeasance.

Let’s take caution in our choice of words to be certain we characterize people and their actions clearly and fairly. An exact definition of malfeasance (in office) is difficult: there is no single legal consensus definition.

Malfeasance is generally defined as “a wrongful act which the actor has no legal right to do.” Many courts find malfeasance (in office) where there is “ignorance, inattention, or malice”, which implies no intent or knowledge is required.

Much of what we’ll hear, however, will probably trigger accusations of malfeasance.

Truth: the final frontier.

I’ve invested literally hundreds of hours pouring over a vast array of communications, agendas, minutes, resolutions, staff and consultant’s reports, spreadsheets and financial records from both the city and from Orange County.

I’m not alone. Several others, equally curious about Brea’s past fiscal practices and current fiscal policies, have invested similar time and energy… and come to similar conclusions.

What has been common practice in the past has cost Brea the loss of significant assets and revenue sources and has placed an undue burden upon tax payers to meet unconscionably large financial obligations well into the future.

There is clear evidence, going back several decades, of both ignorance and inattention to detail contributing to the failure of Council members to exercise the full due diligence their office and those who’ve elected them demand.

Malfeasance… I believe so. Malice… not so much. Let me explain.

I’ll point the finger…

Repeatedly it has been found that Council member’s information packets come up well short of including a full set of facts. Consistently, the missing information helps lead Council to forgone conclusions staff has predetermined are preferable.

Again and again it appears that staff has usurped the visionary role and authority of Council. While the evidence of malfeasance is frighteningly clear, at least to me and those digging into these matters, a couple of critical questions remain unanswered.

Obviously staff has the means and opportunity to play fast and loose with Brea’s financial future. What’s missing is motive. Why would our city staff, highly educated… the best and the brightest, do what they’ve done and to what end?

What’s next?

We may never find any answer to why and what for but we can cast a bright light upon this nightmare in the hopes that today’s Council will find the courage to challenge history and change the future.

malfeasance

Moore On The Downtown Parking Structure.

Roy MooreYesterday, Roy Moore, weighed in on the downtown parking structure and unfunded pension liabilities… tying them together in a most sensible way. With permission, here is the heart of Roy’s message.

BreaNet, Issue #708

If I may, I would like to comment on the proposed parking structure to be built behind the Tower Building on Super Block A. In January 1999 the City Council approved construction of the buildings on Super Blocks A and B. At that time I argued for a parking structure.

We could have built it for five million dollars with Redevelopment money without disruption to existing businesses. The Tower Building would not have been empty for nine years. I still support such a parking structure. The Council has approved the concept but still is struggling with how to pay for it. It is apparent that tapping city reserves will be necessary.

I would submit that before this decision is made the City Council first formulate how to fund Brea’s unfunded liabilities. This most likely would have to look to these same reserves for a possible solution. This is no small problem. CalPERS currently reports that as of June 30, 2013 Brea’s unfunded liabilities are $108 million.

Although much has been done in recent years requiring city employees to contribute toward their maximum to cover their pensions it does not appear that this will totally solve the problem over the next 25 years.

Here is my recommendation for a possible solution.  Brea’s landfill is an asset that I believe will generate revenues until at least 2040. The determinant on when to close the landfill is the height of the “trash mountain”.

There are two reserve funds as a result of the landfill.

The Capital Mitigation Improvement Fund (560 Fund) currently has a balance of $5.16 million. This fund was created by the $10.5 million payment from the Orange County Waste Management for the eight year extension of the landfill. I believe there will be at least two more extensions.

The original amount has already been reduced by 50% to make improvements to Valencia Avenue (valid use of funds), pay two solar bond payments (supposed to be paid from electricity savings) and the Birch Street medians.

The second landfill fund is the Community and Economic Development Fund (140 Fund) which currently has a balance of $3.48 million and results from revenues received for out-of-county trash deposits in our landfill at $1.50/ton. This amounts to in excess of one million dollars a year.

I recommend placing a large percentage (at least 50%) of these two funds (current balances and future growth) into a special unfunded liabilities account to earn interest and be used to periodically pay down our unfunded liabilities.

So what does this leave to fund a new parking structure?

Assume a structure for parking only, no affordable housing and a not-to-exceed cost of $9.0 million: 560 Fund – $2.5 million, 140 Fund – $1.2 million, 110 Fund (General Fund) – $3.0 million, Redevelopment funds – $3.8 million.

This adds up to a healthy $10.5 million.

Note: the redevelopment funds may not be available and depends upon the State Legislature approval of Governor Brown’s trailer bill. Using long term financing could make up the shortage using the annual growth in the 140 Fund to make the payments.

The bottom line is that it is possible to put in place a plan to cover our unfunded liabilities and also provide a new parking structure in the Downtown. How the financing is structured and whether any of the funds are a loan to the Downtown is up to Council.

For what it is worth that is my two cents on the subject. – Roy Moore

Moore on MadronaAs always, thanks Roy.

A Public Response.

Well, it’s time I offered a public response to the folks wondering if I’d been run out of town by our new bloviating blogger. Hardly. His vacuous attempts to wade in on issues without the benefit of a single provable fact have only served to boost readership of Brea Matters.

wading-inYes, there are numerous topics that are high on my interest list… and most involve spending serious coin, setting precedents that may prove harmful in the future, will create greater traffic hassles than we now endure or barely give lip service to the promises of greater transparency and engagement.

Simply put, I have refrained from wading in for good reason. Having been appointed to the Planning Commission I must weigh each issue based upon whether it, or some aspect of it, might find it’s way onto the Commission’s agenda.

My job as a Commissioner is to review and understand every item with an open mind, my opinions set aside in favor of case-by-case judgments made without bias.

Thankfully, I am working with four other Commissioners and a professional staff having deep histories and broad experience in public planning and an excellent grasp of the laws, regulations, ordinances, guidelines and standards that apply.

What about Citizen Clark?

roy-mooreI am taking a page from Roy Moore’s playbook. For sixteen years he successfully chronicled every issue, large or small, in his bi-monthly newsletter BreaNet.

When issues heated up he solicited opinion from the friends and neighbors he faithfully served. He trusted the public and they trusted him.

When issues were formally discussed, BreaNet filled in the gaps in action minutes giving us the details we needed to better understand what was happening down at city hall.

And when the votes were cast, Roy Moore provided a clear analysis of the final results.

What better mentor than Roy Moore?

Roy MooreI can think of none.

I shared my draft of this post with Roy this afternoon. He was kind enough to put down the Sunday paper and share his thoughts on how I will best serve Brea with this blog.

I’m doubly encouraged that he’s considering guest blogging here as a way of continuing his service to Brea. I’m eager to hear his stand on matters like unfunded pension liabilities, proper use of the 560 Fund and whether Brea ought to be paying some outsiders $180 thousand bucks to tell us how to plan for the next decade or two.

I have no doubt Roy will keep a close eye on me and will be quick to take me to task should I need it. So… that’s it for today.

And make no mistake, “I’ll be back.”