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By BRETT WILKISON
THE PRESS DEMOCRAT
The bare-bones outline of a report on Sonoma County government’s rising pension costs got its first airing Tuesday before the Board of Supervisors.
The report by a committee overseen by supervisors Shirlee Zane and David Rabbitt had few details. Most of those are to come in October when county staff present the full report.
The study is one of two efforts aimed at curbing county retirement spending, which rose more than 250 percent over the last decade. Including additional payments on county pension debt, that 10-year rise is almost 340 percent.
“I think everyone agrees that this board needs to take action to make these benefits sustainable,” Zane said in her introduction.
The presentation by county staff included an initial series of findings on county pension costs and other information gathered during the committee’s work, which began early this year.
Most of those findings were not new. For example, the board presentation showed the escalating cost of pensions as a percent of the county’s payroll. From 2000 to 2010, that rate tripled, to 30 percent of payroll or about $92 million. That means for every dollar the county pays toward salaries, it now pays about 30 cents into its retirement system and toward pension debt to support the current level of benefits.
“The one word that comes to mind is ‘alarming,’” board Chairman Efren Carrillo said of those numbers.
Other counties in the state are worse off. Among 19 counties recently ranked highest to lowest on the percentage of payroll going to pensions, Sonoma County ranked 13th — higher than Los Angeles and Tulare, with rates below 20 percent, but well below Fresno, which has a rate over 50 percent, according to a study by the Mendocino County Employees’ Retirement Association.
Still, the county’s skyrocketing costs are a well-known trend and show no sign of leveling off soon, officials acknowledged Tuesday. By 2014, those costs are set to rise an additional 20 percent, to about $110 million annually.
The full report will offer the county’s first comprehensive answer for why that rise has occurred and present some suggestions on how it might be curbed, said Rabbitt, who also serves as a board member of the county’s retirement system.
The switch to a higher level of retirement benefits early last decade, the pension fund’s $670 million in stock market losses in 2008, and the county borrowing used to pay off those and other losses — now totaling more than $820 million in principal and interest — are some of the largest factors, Rabbitt noted.
“It’s important to make decisions that will, if not save money, at least stop the ballooning of expenses and debt,” he said.
A labor leader on hand Tuesday said he would wait to see what policy or pension overhaul options the full report puts forward.
“I don’t think we heard enough to know where we’re going,” said Ed Clites, president of the Sonoma County Law Enforcement Association.
Clites and other labor representatives are involved in a parallel process, overseen by the county administrator and personnel offices, looking at options for a lower level of pension benefits for new county hires.
County Administrator Veronica Ferguson said she’ll take any eventual recommendation from the group as well as any from the board committee’s final report into contract negotiations, which are set to begin in the first quarter of next year.
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Robert,
I couldn’t afford to do it, but some people actually do get themselves elected despite a financial loss to their lifestyles.
Its about ego, political favors, and power, you see.
Not to throw gas on the fire, but haven’t people here been saying all the politicians are in the pockets of the unions? Who else is going to get elected to make the changes? Some independently wealthy person with extra time on their hands? How will it change? McGuire was the only one who took a pay cut. $30k a year I think. Who you gonna call?
The numbers are clear and the taxpayer’s are pissed!
Our County supervisors have only two choises.
1) make drastic cuts by re-negotiation of pensions and install a new pension plan that excludes the defined benifit program.
or-
2)loose their jobs as represenitives of the taxpayers.
I refuse to support an elitist class of government employees while our basic needs are ignored.
@Juvenal.
So 30% “employer” contributions don’t alarm you.
Do you realize that the IRS has very specific maximums that, in the private sector, an employer can contribute?
In a Safe Harbor 401k, (smaller companies), the maximum allowable contribution by the employer is 4% of an employee’s pay, and then only if the employee contributes 5%.
To a Simple 401k plan the maximum is 3% if the employee also contributes 3%.
Do you see the problem here?
http://www.irs.gov/retirement/article/0,,id=119625,00.html
Statements regarding increases since the year 2000 are just plain misleading, since the level of employer contribution at that time was extremely low.
Why? Because the tech bubble made it appear that SCERA and all of the other funds were sitting better than pretty and employer contributions were reduced.
Because that calculation proved to be in error–because the tech bubble burst–contributions then were increased.
Other reasons for present increases are a change in the assumed discount rate, which this newspaper pounded the drum for despite ample evidence of long term returns in the 10% range, and the fact that a large portion of employee health benefits were made pensionable under the Dies regime. This is unheard of elsewhere.
City Watcher:
You want to allow law enforcement to shoot simply because they feel fearful ? Thats crazy. That is one whacked out opinion.
In today’s news, two Sonoma County deputies admitted that they couldn’t even find a simple street address and ended up making arrests of pot growers which then was declared illegal by the appeals court.
Clearly, those two deputies don’t deserve the public safety pension that is bankrupting our communities. That they were unable to find a simple street address is astounding enough and then they made an illegal arrest. Unbelievable.
I must disagree. I think ANYTIME they fell they are being threatened, they should shoot them. Take away the night sticks, take away pepper spray and the killer tasers. One choice, comply or die. Too many have been killed or beat half to death trying to be sensative. Forget that. If your not a criminal, and you don’t resist, no problem. I truly feel we need to move backwards on the force issue. There would be a lot less violent criminals walking the street. I am not a criminal…. I am all for this. If you don’t like something, complain later, until then, be nice.
Edgar Perez,
With regard to the Board of Supervisors claiming that they were caught by surprise regarding escalating pension and budgetary costs, I could only suggest that they are about as DIS-honest at the two deputies in today’s news to claimed to have lawfully found a pot growing operation despite not being able to read simple street addresses.
DIS-honesty in government. I’m sick of their lies.
City Watcher:
I think by reading your post that you are referring to today’s news in which a Sonoma County deputy sheriff shot an unarmed man. The fact that the deputy was fearful does not give that deputy the right to shoot an unarmed man.
If you are a deputy sheriff and cannot perform your function without shooting an unarmed man, its time to turn in your badge and resign.
Oh, but the public safety pension beckons you? But, of course, we understand your greed.
Some scum bag tried to take the retirement from a Deputy today. I was glad to hear the Deputy was ok and the criminal was shot. Hopefully that deputy will reach his retirement. Some are hoping it won’t be there when he gets to it.
@TruthInNews.
Of course there isn’t a problem, how could this be a problem?
From the article:
“For example, the board presentation showed the escalating cost of pensions as a percent of the county’s payroll. From 2000 to 2010, that rate tripled, to 30 percent of payroll or about $92 million. That means for every dollar the county pays toward salaries, it now pays about 30 cents into its retirement system and toward pension debt to support the current level of benefits.”
Pointing at another problem does not make the problem discussed in the quote above magically disappear.
THE PROBLEM ISN’T PEPOLE WORKING, ITS PEOPLE ON SOCIAL WELFARE PROGRAMS!
Bear-glad you’re still posting. I figured you wouldn’t be able to stay away. We need more “libral” and “socialist” voices on these posts.
Pearl-Medicare and Social Security are not in the dire straits that the Right want you to believe. The Rightwing wants to do away with both along with any other safety net programs designed for the middleclass and poor. When it’s gone the elderly will starve and die-what used to happen before either program came into existance. The right is quite happy to keep welfare for the rich (subsidies, tax breaks, tax loopholes, tax shelters and so on).
The fix for Social Security is easy. Raise the limit on the upper income that FICA taxes FICA taxes are levied on. Right now it’s (I believe) $106,000-something like that. Double it and we’re in the clear for a hundred years.
As for Medicare, get rid of Medicare Advantage Plans which are SUBSIDIZED by our government and cost more to boot. Medicare is STILL A BARGAIN. The overhead on Medicare is about 2% which, compared to private insurance and the advantage plans, is next to nothing. It’s a bargain. Insurance shouldn’t be a commodity traded on Wallstreet where CEOs are rewarded richly for denying services. In fact, other countries do not have “for profit” insurance companies because they believe it is a right for their citizens to receive healthcare. The citizens pay with their taxes.
There is plenty to be fearful of. I’d worry more about the decimation of the planet because that will negatively affect the whole human race. Put your worry energies there. We all should.
Civility, then accuracy when using quotation marks.
The Board was caught unaware by the $340 MILLION dollar increase over the past 10 years in pension costs. Were they caught in the magical poppy field and put to sleep on their way to the Emerald City that is the Board of Supervisors chambers?
The US dollar looks good having lost 20% of its value in the past 10 years.
Who will be held responsible for this financial debacle? Certainly not the Board members past and present and the unions who directed the Board to implement these pensions?
If not these jesters than who? Well, it will be paid by those who pay in silence, the forgotten taxpayers of Sonoma County who always end up with the tab at closing time.
Correction bear: “Fiscal conservatives love this”
NO! Fiscal conservatives have been warning everyone this would happen but the spend, spend, spend crowd were too delirious from all the “free money” to hear the warnings.
Plus we’re just “ignorant conservatives” so why listen??!
Sure, the “economic downturn” has shined a bright light on the situation but this was as inevitable as the pending collapse of Medicare & Social Security.
You’re NOT listening to THOSE warnings either.
No, you would rather add MORE TAXES to reward your thieving former colleagues for their incompetence.
Go ahead, drive another stake into the heart of the goose that lays the golden eggs.
Once you’ve taxed all the businesses & workers out of the state you can fill your own pot holes & pay the Firemen out of your own pocket. Oh, wait… that wonderful plan didn’t fly!
Anymore great ideas there bear?
OK I’ll say this one more time.
County employees pay big bucks for pensions and healthcare with every paycheck. More every year.
For healthcare under the “County Plan,” try 70% increases per year for the last two years, with more to come. My health insurance is now substantially more than my mortgage.
Yeah, I know I’m lucky to have it, but if I didn’t I’d be in the ER and that would still raise your costs.
We have tax revenue, salary and rate of return issues. Everyone is measuring the future based on the worst economic downturn in 80 years. Of course things will look bad. Fiscal conservatives love this. Public pension investments have suffered just as much as your private sector 401Ks. Do you panic and stop investing?
Or break promises made, like the TV ads encourage for taxes and credit card debt? What is realistic? What is ethical? How would these forecasts have come out 5 years ago, when the economy was closer to 80 years of “normal?”
Elected officials, especially in County government, are at the top of the food chain. They determine what benefits THEY would like, then have to adjust the benefits of their management and the workers. Want names?
Unions do NOT, NOT have the power or money to dictate wages and benefits to elected officials. I was there.
The whole thing could be fixed with a dime-a-drink tax on wine and alcohol. Just like they do for cigarettes.
The wine industry wouldn’t like this. so elected officials will never do it.
Who really has the power?
Don’t panic. Don’t base future policy on the two worst economic years in recent history. Don’t be misled by people who would profit off your misery.
Remain calm and follow the money.
Your Social Security and Medicare are also on the table. If you’re younger, then worry about your parents. And then yourselves. Panic helps no one.
Message to John / re: building permits.
John, I have a friend who requested a permit on a job he did himself. They granted the permit, but when it came time to inspect, the public employee building inspector told him “we don’t climb into attics to inspect.”
Thats right. The county gladly accepts the payment for the permit and issues paperwork but the public employee is not required by his job duty to actually perform a final inspection.
Its that kind of shoddy government performance that we now see in the public pension scandal overwhelming Sonoma County. They pretend like it took them by surprise even though the rest of us were watching it play out all around us in different California counties and cities.
I actually see no reason any more to even pay taxes. All they do is take our money and mock us with pathetic job performance.
Not that this really has anything to do with the Pension Fund. But are we talking about Sonoma County, the same county that has how many law suits going on now? I lost count.
Also it seems on every Agenda the Board of Supervisors is granting fee waivers for some group or another. After awhile, this is got to add up.
Well maybe this does have to do with the Pension Fund, after all it’s Sonoma County and the Supervisors and Money. Do we see something in common here?
Hey John-the reason the office is only open for 20 hrs a week is because the frontline employees were laid off. You can bet the managers are still there. You might complain to you county supervisor from your district.
Frontline employees work for you. They would like to do the best job possible but the numbers are getting fewer and fewer and fewer. One managers job can cover 2 or 3 frontline (or more looking at what the CAO gets paid). If there is no one there to cover the office is CLOSED.
One telling data point: Recently I had to go pull a building permit at the Santa Rosa city hall. The department which processes this (which creates jobs and revenue) was only open 20 hours/week. HR on the other hand was open a full 40 hours/wk. I understand that with the incredably lavish eye popping benefits package gov’t workers enjoy it must require a small army to administer however most of us in the private sector know when times get tough HR is the first place to cut or outsource. In the parallel universe of public employment however the cuts which inflict the most pain are first and foremost. Unions RULE calif. and they do so with an iron hand. Public agencies are run for the employees first. Service to the public is secondary.
A friend of mine just forwarded me a message about what the parent company of the organization I used to work with is doing with their 160 on site inspectors, to give you some idea of what is happening in the real world.
The organization is a multi billion dollar company with a very well known national name.
All 160 on site inspectors are being terminated in August, their current pay rates are from $80,000 to $140,000 per year.
All can apply for the 160 new jobs now called on site “coaches.”
The pay rates for those positions are from $50,000 to $70,000.
For me, no question the old salaries were out of whack; always thought so.
Do you think Government would take such bold measures to address out of control salary and benefit growth?
Not a chance.
I Don’t Get It-there are always management jobs getting hired. Ask the county supervisors how many new management positions they approved were added and hired for in the last 4 years while there was a “freeze” on hiring. The ratio of management to frontline workers is ridiculously low. They kept their jobs, frontline workers lost theirs.
well said @ALEX !
ALEX for SUPERVISOR !
thumbs up
tough times and rough economy, recovery does not seem to be in the near futuretat
Good reporting (sarcastic tone)…now how much did the welfare and “affordable housing” go up in 10 years? How many programs have been created and are part of the budget that was not there 10 years ago? What was the average percentage increase of all other programs and projects? This is another example of look at the villain middle-class worker while the politicians benefits and pay goes way up…the “hey, dumb-dumb look at the sparkles in my right hand while my left hand robs you blind.” How many special interests programs got the nod in ten years then thrown on the backs of the middle-class to pay for it? Take for example, the $800,000 Bike Boulevard a.k.a., Humboldt Ave…pushed by special interest groups such as the Bicycle Coalition. Who paid for that? The Mr & Mrs Tax Payer as usual. Why not take a look at the insanity of the spending on special interest projects and the kick backs given to corporations? The 80 million dollars in kick backs to developers in the past 10 years so they can build affordable housing. Here is the kick, most in the county are not eligible for the “affordable housing” because their income is that of the middle-class. So while the middle class gets stuck with substandard old housing, the so called needy get brand new housing at a discount rate because the middle-class is the one paying for it through fees and taxes. I love how Zane and Carrillo, both of whom are golden prodigies from “non-profits”, try to blame the working people for benefits the County agreed to pay for through negotiations. How they now try to change the rules after the game has been played…a tactic of cheaters and liars to be blessed by drunks and fools. For God’s sake, between the dumb of the voters, the political whores, and the newspaper, if you are inclined to even include the word “news”, no wonder everything is going in the crapper.
Alarming ?
The topic of unsustainable public pension ‘obligations’ has been discussed in the private sector for years !
We were alarmed at least 5 years ago, and it takes them this long to realize ?
Months and months to study ? We are doomed by our own votes. Shame on us.
Are you kidding? The Committee has been studying this issue for months and the fluff presented yesterday was the result. Seems those charts could have been thrown together in hours. And at least there should have been someone that could answer basic questions, like how does the rate paid by Sonoma compare with other counties. The fix seems to be in. Zane and the CAO are clearly controlled by labor(and there own) interests. Thank goodness for David Rabbit. He expressed some great concerns that should be shared by all. I hope the next election provides some similarly intelligent, and independent thinkers who are not beholden to maintaining the status quo.
I don’t get it. How can there be a job opening at the City of Santa Rosa when they are cutting ?
911 Preparedness Coordinator Needed >
http://ci.santa-rosa.ca.us/doclib/Documents/Emergency%20Preparedness%20Coord%20JB.pdf
During tough times at a private company, those that remain on the job must do with less, which means you wear many hats.
We let 2 of our employees go, (our only 2 we had) back in Dec 2007 & have not hired since. My husband & I do it all. Its 10pm and still have a couple of hours of paper work to complete before we pass out & get up to do it all again. I don’t get it. How can they be hiring when they are cutting ?
This is what happens when we elect people who haven’t got a clue on how to run a government. It’s a popularity contest during election time.
Now we know why the County Treasurer/Auditor retired right after he was re-elected…
Let’s see if he can work his financial engineering magic in Marin County…
Remember, pension obligation bonds will save us money….
You don’t have to hire a committee to do a study, just drive across 37 & ask the folks in VALLEJO!
We all know were this is heading.
It’s hard not to sympathize with people who worked for years expecting a nice retirement only to find that all the money is gone.
Maybe some of these people should come forward and expose all the obscene waste they KNOW is occurring in our County GOVERNMENT and help save what’s left. Short of that…
We all know were this is heading!