Pension Tension

Last week, the Council emerged out of closed session directing staff to communicate and negotiate with the unions regarding the possibility of a ballot measure and pension reform. The goal is to combine these two topics and create/work within a timeframe if possible.

For savings to occur, it is important to have something fully implemented prior to next year’s budget. The key word is “implemented,” as savings need to be delivered in advance of the city manager’s budget in 2012 so that we can save services from being cut and save additional city employees from being laid off. Otherwise every city department better hope that federal grants come raining down for every city position because our budget will be entering a $70 million dollar deficit year. Who knows, maybe once-plentiful federal money will be pouring out of the sky since there will be a presidential election.

I am concerned that the truth regarding pension reform is not being shared appropriately. I think that the process needs to be public so residents, retirees and city employees can hear the information first hand from both sides. The council chambers should be used each time to allow a public audience to observe first hand about the realities and limitations of the current pension system and hear the proposals directly from the negotiator’s mouth. 

This would eliminate any disconnect from union representatives and the union membership. It would also allow retirees to be fully plugged in as they cannot rely on the current union membership to fully support their interests. Finally, a public process would allow residents to see what each side says as the residents will be the final judge who would approve through a ballot measure. Even changing the the current pension match from 250 percent to 249 percent requires voter approval.

For too long we have wasted time back and forth about what was said or what was not said and even the tone of voice in which words were delivered.  There is nothing to hide, so let’s get it all on the table. If we cannot come to agreement then it is off to the ballot box with an actuarial sound set of pension reforms that include management and the city council. However, if there can be an alternative, through negotiation and education, which delivers true savings to maintain city services then that would be ideal. 

Moreover, it cannot be reducing a 250 percent pension match to 230 percent. The savings needs to verified and substantial since the problem is not small. These changes must go to the ballot box to alter the City Charter whether by fiat or mutual agreement.

Otherwise, we head down the same road of mistrust on both sides with silly games and political posturing with closed-door meetings. Pension systems have dramatically changed as we know in the non-union private sector, however they have also changed in unionized organizations like the construction trades. Local governments are next.

This topic is too important to have behind closed doors. Let’s suspend all boards and commissions not in the city charter and put these meetings as the top priority and on TV. There could be no other topic more important to San Jose so let us focus and get it done.  We need to move past this expeditiously so we can focus on the San Jose of the future, which is not solely about reducing services.

In other news last week the Council voted 10-1 to exempt affordable housing projects that are in the pipeline from paying park fees. I will let you guess who voted no.

53 Comments

  1. PO

    Thought the Mayor set city budget after 1986 Measure J established Mayor as political leader of city and controlling budget but you said city manager budget what is that ?

    Please explain who sets budget, city staffing, what services gets taxes and what get cut since many residents are confused about who is responsible for doing what with budget   Thanks

    • Mayor does have some budget power but Mayor’s budget is released to late and simply tweaks City Manager budget. Savings need to counted by the time of Manager Budget.

      Pierluigi

  2. Hear, hear!  Thank you, Mr. Oliverio, for a wise and thoughtful proposal.  I hope all of the other “powers that be” can get behind this.  It will be interesting (unfortunate?) to see if any group has something they wish to remain hidden, behind closed doors.

  3. As a City employee, I agree that it should all be out in the open, which is how we have ALWAYS wanted it. We want the truth out there. Your suggestion is welcomed. Thank you.

  4. PLO,

    It’s nice that you want to discuss pensions in public view. But the real issue going on is your inability to keep residents safe. I keep reading in the paper about all the murders, shootings and stabbings. I even read about an assault on a police officer. My neighbors have been talking about how they won’t walk their dog after dark around the block, because they are fearful of all the violence occuring near our neighborhood. I would like to go downtown, to the theater, but after Thursdays race riot I think I will avoid downtown in the near future. It seems the Gang task force is a joke now, something the mayor is so proud of as being a national model. I could go on and on. I am very disappointed with the city council and mayor. Your first priority should be keeping the residents safe, something at the present time you and your peers are failing miserably at.

    • With limited tax revenue we must choose the priorities. My budget memos on outsourcing park maintenance at large parks and reducing funding to charities would have saved 42 police positions.

      Pierluigi

  5. “For too long we have wasted time back and forth about what was said or what was not said and even the tone of voice in which words were delivered.  There is nothing to hide, so let’s get it all on the table. ”    “There is nothing to hide, so let’s get it all on the table. “

    Apparently BOTH city and labor unions have a LOTS to hide from public because

    1)  city administration has strongly publicly opposed Open Public Labor Negotiations Meetings and

    2)  labor unions who publicly say that they want Open Public Labor Negotiations Meetings

    had Mayor and majority Council members VOTE against Open Public Labor Negotiations Meetings and believe it is better politically to hide where taxes are spent from public and gain from secret labor negotiations details,  offers and counter offers and who says what at closed door meeting from voters and taxpayers

    “Otherwise, we head down the same road of mistrust on both sides with silly games and political posturing with closed-door meetings. ”  ” This topic is too important to have behind closed doors.” “and put these meetings as the top priority and on TV. There could be no other topic more important to San Jose so let us focus and get it done. 

    – Agreed but you do NOT have Council votes to change COUNCIL POLICY that makes all talk about San Jose’s Open Transparent City Government a PUBLIC JOKE and BIG LIE when Council votes for Secret Closed Door Labor Negotiations and hides where millions city taxes go which is responsible for 10 years budget deficits and reduced city services

    Who on Council other than you voted to have open public labor negotiations meetings so everyone can see what is going on and how city taxes are spent ?

    Voted for open public labor negotiations meetings:  Pierluigi and   ?

  6. Nobody trusts anybody anymore. The City Council doesn’t trust the Union bosses who in turn don’t trust the Council. The taxpayers don’t trust either one and believe that the City has too many unnecessary employees and other money but will not use it! Let’s look at everything! There are a number of City run enterprises that would produce millions of dollars in additional annual revenue if they were privatized and run like a profit seeking business.
    To name a few: the Airport, Off-street parking lots and garages, the Convention Center, golf courses, City and Redevelopment Agency properties plus other money sources of which the general public is not aware.
    Why do we need a Civil Service Commission if we have unions? Let’s have one or the other and let the public decide which one.
    Some Cities have a Department of Public Safety instead of separate fire and police departments. Some Cities have neither and contract for police and fire services.
    Why are some nearby Cities in good financial health while San Jose is going broke? (And do’t give me that crap about too many residential units and not enough commercial/industrial uses. That one comes from our City Planners who caused the imbalance to begin with.)
    Keep trying Pierluigi. Remember the old Latin saying: “Illegitimi Non Carborundum”! In English “Don’t let the Bastards grind you down”.

  7. I watched the city couuncil last week. It was Mr. Rocha who wanted things to be heard in the open, and Mayor Reed and the city attorney insisting updates were heard in private. Amazing how you twist the truth. Anybody can go back and watch it if they want.

  8. Let’s focus on a real issue:

    Not one of the 75+ management executives earning more than $150,000 per year (plus generous benefits, time-off and pensions) are being laid off or demoted with the hundreds of lower paid real workers going out the door or changing jobs. 

    And the chief union buster is even being promoted to yet another deputy city manager.  How many high paid executives do we really need for a dwindling work force?

    HOW ABOUT LAYING OFF EXECUTIVES AND OTHERS IN THE MANAGER’S OFFICE?  Each one could save two other positions that do real work.

    Don’t be duped by the Manager’s analysis showing managers are being cut the same as other groups; that study didn’t focus on executives and included supervisors earning less than $100,000.

  9. SJPOA Propsed this years contract negotiations be open to the public and…… you guessed it, the City said, “NO!”

  10. The pension problem is structured to look worse than it is.  Yes, the funds lost money in the stock market crash.  Yes, there are abuses and seemingly outlandish payouts.  For the most part however, the average payout is far below the $100k plus number that keeps being thrown out.  And the “pot” is funded for many years, it is not in danger of collapse any tiem soon.  Certainly it is funded beyond the 5 year window that the City has decided in order to make it “fully funded.” That 5 year mark is structured in order to make the liability look immense… to justify a fiscal emergency.

    Should a reasonable time frame be used, like the longer term given to pay for the new City Hall then things aren’t quite so dire.  Pension reform should certainly be discussed, but let’s try to keep it in perspective and stop the FUD.

  11. What we have to wonder is what the Mayor and City Council are trying to hide. The unions say the City isn’t negotiating in good faith nor trustworthy, the city says the same about the unions. The Mayor hides behind attorney client privledge, what is it Mr. Mayor, is what your doing illegal? PLO I have to say I haven’t been a supporter of yours in the past..but bravo.. what would a little open honesty hurt. NOTHING.. Keep up the fight, maybe with your option everyone migt get along. NO more we said/they said.

  12. It was mayor Reed who wanted open government and sunshine reform and now he wants union talks in private. You just can’t trust that piece of $&#*!

  13. Provided they are civil and don’t have the usual collection of need to get a life attendees shouting out their opinions during the sessions.  Having said that, sometimes it can be distracting having people who are not completely in command of all the facts demanding to interject their opinions in a process.  When you opt for surgery, the time to do your homework, seek opinions, check credentials, etc. is before you start the operation.  Once you begin, having a peanut gallery trying to direct the surgeon would not be a wise decision.

    I am a taxpaying voter. I like my views to be heard and my wishes to be followed.  I like to know how my elected officials vote and how they arrived at their decision.  However, I don’t see the need to sit in on every meeting and try to shove my probably less than informed opinions in on the process in my one minute speaking allotment.  We elect officials to do our bidding.  We can’t baby sit them every minute of every day.  If they consistently vote against the majority wishes or prove incompetent at handling our collective finances, then we should vote them out. 

    I also wonder how much impact the political winds will have on contract negotiations over substantive facts.  Somebody is peeved at a certain group of workers so they appear at the negotiations to vent.  Somebody is disgruntled that their candidate didn’t win a seat at the council so they appear to voice their opinion against that councilperson an every issue including their contract opinions.  How about special interest groups that line up hours ahead of time to saturate a meeting and make it appear as if the majority believes only in one side?

    People like to say we live in a Democracy but that is not true.  We live in a representative Republic that relies on politicians to do the bidding of the masses without second by second hand holding.  We should trust our elected officials and if they fail to live up to our standards, show them the door.  We shouldn’t have to pack every city meeting to parse every little detail of every financial decision.  If we do, then we have the wrong people at the helm.  This of course presumes that our elected officials are reasonably honest and don’t feed us BS day in and day out about how great they are while they cover up anything negative. Which is happening now…

    • Having the public attend or watch on the TV or internet is away to keep everyone on the same page. Public comment was not taken at the Attorney Union public meetings and it worked.

      Pierluigi

  14. And I am sure by “fiat”, that a measure could easily be put on the ballot and approved drastically reducing council pay and eliminate pensions and other benefits.

    • Actually no. The Charter lays this out in the salary setting commission. They would do this and they did reduce compensation. I supported Constant memo looking at options on council pension going forward. Council pension is approximately $12K at age 60.  However residents could gather signature to change this via the ballot.

      Pierluigi

  15. Pierluigi,
    I agree with you 100%. It is time that the Mayor, Council, and City Manager start working side by side with ALL Unions, and City employees to save our City from financial disaster. It is also time for citizens to be allowed to see how the City is dealing with City employees and Unions. It nips the he said she said in the bud!

    Give Bella a pet and smooches for me, and thank you for rescuing her from the shelter! =^,,^=

    • Again we can save police position by doing things differently in other City Departments which will allow for more to be allocated to police.  The 2nd amendment allows citizens that right.

      Pierluigi

  16. stop posting worthless information to advance your political agenda.  You hate public safety and could care less about saving jobs.

  17. I, for one have consistently and positively acknowledged PLO’s consistency and perspective when it comes to votes on, zoning conversions, new residential construction, and low income housing. We don’t always agree, but our dissent has been civil and we’ve acknowledged civilly when we do agree as well. In fact, I daresay that, as unpopular as PLO may be with many officers for his votes on certain issues, they’d applaud his votes on theses issues if they knew. Frankly, the vast majority of us are dead against adding any new housing and see firsthand on a daily basis what a disaster BMR housing has invariably been for our city.

    Frankly, we do understand these issues and see BMR housing as a boondoggle – creating more work for us in a vastly disproportionate way compared to Market Rate housing. Furthermore, given all the facts, we’d probably all agree, that PLO’s pro-business stance is about the only way to correct all that’s wrong with the city right now.

    Anyway. It’s all pretty irrelevant since the rest of the city council has pretty much stayed bought by their various special interests.

  18. We union members are all also members of the Illluminati.  We hold secret meetings late at night and have access to every detail of every decision facing the city council.  We have won every dispute with the city leaders, achieved every single contract that we ever proposed, and take unholy pleasure in being the puppet masters for our city leaders.

    Oh, I know that it may appear that when you compare city worker pay and benefits compared to other cities we seem on the surface to be just average.  When you look at public safety expenditures it may look like San Jose pays far less than most large cities.  But in the shadows the city is writing checks to union members with false names, false accounts, and otherwise pouring the city coffers into the union pockets. 

    None of this of course is admitted to by Reed, Figone, or any past city leader.  They were masterful actors and actresses all the while putting on an appearance of being tight fisted and holding the line against truly excessive benefits.  In reality though all those contracts that were monitored by the City Attorney and the union attorneys, are really just a prop.  The real contracts of course are hidden away in a safe deep in a building designed by the Freemasons.  You will never see them but they are there providing union members with a lavish lifestyle.

    Of course all of this information cannot ever come to light, well except on abovetopsecret.com, but never in the mainstream media like the union lovers at the Mercury News.  Clearly they are part of this grand cover up too.  Please cease in exposing this cabal that we call city government and public employee unions otherwise we will have to do something drastic like send Michael Moore to do a documentary on your personal life.

  19. Anyone watch Constance talking Cop talk on CH26 today?  He is suddenly worried about the murders and crime spike in the city.  Now THAT the city has it’s 10% wonder if they will suddenly find money to keep the 100+ officers on the Job.  Pete FYI you were never a cops cop.  You were the example of what not to be.  Don’t attempt to fix something you broke.  Read our paper that came out today. “VANGUARD” Even our Pres/V.P. told us as cops it’s time to leave.  You and council took one of the most respected Police Departments in the country and working with the Mercury News ruined it.  SHAME

    • Pete done good today and put forth a number of common sense proposals to minimize police layoffs. 

      Also appreciated that Pete turned the spotlight on the lack of transparency and budget gimmickry when it comes to council slush funds.

      Not one councilmember backed him up.

      • Of course not one Councilmember backed him up. Even this group knows a gasbag when they hear one. His proposal was not well thought out, contained misinformation, and was grandstanding at its finest.
        Now he can run to his rightwing media friends and whine to them about how terrible SJ is. He has become a joke.

  20. These all sound like good common sense suggestions and reflect a desire to work for the public interest rather than catering to one or more special interest. We should ALL be applauding them

    If city employees really knew what was good for them they’d be thanking Pierluigi for his lone dissenting vote on the affordable housing developer park fee waiver issue and raking the other councilmembers over the coals for failing to vote with him.
    But no. By their silence, city employees once again demonstrate that they are not genuinely interested in their employer making smart financial decisions… “We don’t care about any of that. Just give us our benefits” would be the generic, thoughtful stance on this issue.

    Over the years the unions have used their considerable influence to help guarantee we have a solid majority of hucksters and economic illiterates on the council. That’s worked out pretty well for their members’ wallets up until now. But as Mrs. Thatcher famously put it, “the problem with socialism is eventually you run out of other peoples money.”
    Well now that these socialist organizations have just about ‘run out of other peoples money’ the various unions are treating us to a pathetic spectacle that has the look of a bunch of buzzards squabbling over the remains of a carcass that’s almost picked clean.
    It’s hard to watch.

    • On me…on a 1 and a 2 and a 1, 2 , 3…

      Thank you so much.  Thank you, thank you, THANK YOU!

      John was that good enough.  LOL

    • “If city employees really knew what was good for them they’d be thanking Pierluigi for his lone dissenting vote on the affordable housing developer park fee waiver issue and raking the other councilmembers over the coals for failing to vote with him.
      But no. By their silence, city employees once again demonstrate that they are not genuinely interested in their employer making smart financial decisions… “We don’t care about any of that. Just give us our benefits” would be the generic, thoughtful stance on this issue.”

      These posts were doing so nicely. Enter JG. You like flaming, don’t you? You don’t know WHAT employees are or are not interested it. Why don’t you STFU.

    • ~“But no. By their silence, city employees once again demonstrate that they are not genuinely interested in their employer making smart financial decisions… “We don’t care about any of that. Just give us our benefits” would be the generic, thoughtful stance on this issue.”~

      Barf!

    • Each approved affordable housing development takes requires more in city services than it pays in which takes away from services we can provide, i.e. employees.

      Pierluigi

  21. Interesting that Mayor Reed today voted AGAINST reducing the Independent Police Auditor’s salary. Him and Chu were the only ones who voted against reducing her salary. WTF is up with that, Chuckes?

  22. Pier,
    Why does the city council get to take the entire month of July off? That is ridiculous. You should all be working like the rest of us, especially with all the current problems in the city.

    • I will remain plugged in however the City of San Jose is not unique in having a legislative recess. Federal, State, County, School Boards etc…take a recess.

      Consider attending the Rose Garden volunteer day July 9 at 8AM.

      Pierluigi

  23. Pierluigi said

    “Mayor does have some budget power but Mayor’s budget is released to late and simply tweaks City Manager budget. Savings need to counted by the time of Manager Budget.”

    From your comment City Manager ( unelected official responsible to Council but not public or voters ) sets city budget priorities, what gets funded, what gets cut and who gets laid off with Mayor making a few tweaks commenting and Council ( many of which have little latge budget experience or indepth understanding ) approving her budget with a few small changes

    A former city employee said on SJI a few weeks ago that City Manager has little budget authority, does what she is told by Mayor unlike prior City Managers like Les White who exercised budget authority and ran city government after getting broad priorities from Council

    The 2 statements do not match as to who really sets city government budget, layoffs and makes budget decisions

    Who runs city budget or is this another insider secret with decisions make in City Hall back room, taxes spread into hidden tax accounts and funds with little public oversight, and little to no public / voter accountability for where taxes are being spent

    Except we see millions year after year going to outside city government for questionable public benefits:  baseball and soccer stadiums, money losing golf courses and hotels, mismanaged community group bailouts, developers whose new houses make city budget deficit worst and politically connected corporations