Sally Choi put her job on the line Tuesday even in the face of threats
and intimidation from City Council members who knew very well that
their actions violate both civil and criminal law.
The videos below contain evidence that can be — and hopefully will — be used against them in courts of law.
Councilman
Bernard Parks, a solitary figure who actually knows what is in the
city’s deficit budget and has tried to do something about it, made that
perfectly clear in his questions and comments to Choi, general manager
of LACERS, the city’s largest pension fund which is underfunded by a
staggering $4 billion — nearly a year’s general fund spending.
Good
cop that he is, Parks warned his fellow Council members they were
treading into the danger zone by trying to pressure Choi and the LACERS
board to violate their fiduciary duty to protect the pension fund’s
assets for the benefit of current and retired city workers. He even
went so far as to warn his colleagues against “lobbying” the board, by
which he meant using the back room coercive techniques that are so much
a part of the City Hall culture.
Already, the poor stepchild of
City Hall unions, the Engineers and Architects Association, has put the
city on notice it will sue to block the disastrous sweetheart deal to
handsomely reward some 2,400 employees with an early retirement package
that will let them go out to pasture in their early 50s with $15,000 in
cash and up to 75 percent of their salaries in pensions and lifetime health care.
This
Early Retirement Incentive Program (ERIP) requires city employees to
contribute .75 percent more to LACERS, raising their contribution level
to a modest 6.75 percent. But that is far from sufficient to cover the
$250 million cost of the ERIP without sticking taxpayers — already
facing bills for billions of dollars to keep the fund solvent — with
making up the difference.
Because the Engineers union, under
attack from the SEIU and its allies like the mayor, can see that the
ERIP will only make the city’s financial crisis so much worse and
threaten the future of its members, it has threatened to sue to block
the deal.
It has a good case. The city cannot legally make
workers pay more for their pensions without their consent or at least
giving them equal value for their extra contributions. The ERIP
increase in contributions only benefits those who get to retire with
the sweetheart deal, not those who will pay more for the rest of their
careers.
Here’s what the union’s lawyer told the city in a recent letter (eaapension.pdf):
“Because
adoption of an ERIP now will have huge and long-lasting economic
effects on the City employees who remain employed after the ERIP has
been implemented, a failure to afford the affected employees and the
residents of the City of Los Angeles an adequate opportunity to review
and analyze the actuarial report is both inconsistent with the City’s
obligation to bargain in good faith and with good governance.
“Should the City embark on such an ill-advised course, EAA will not only seek
appropriate legal redress, but it will also undertake to publicize the City’s failure to afford the
residents and voters of the City a meaningful opportunity to participate in a financial decisionith
such a significant, long-term impact on the City’s fiscal health and
the City’s ability to hire and retain competent employees.”
So
here we are in the second month of a new fiscal year with roughly the
same giant hole in the city budget that was forecast six months ago and
the only plan our elected leaders have come up with is blowing up.
They
knew all that was wrong with it from day one. But they didn’t care.
They knew the media wouldn’t pay any attention. They knew they could
keep the public in the dark. They counted on ramrodding it through and
trampling all opposition.
But a funny thing happened on the way
to making the city’s financial position untenable. People like Sally
Choi stood up to them. And Bob Aquino of the Engineers union.
And now you know too what they have done and are trying to do. What are you going to do about it?
The toughest thing to do in this day and age (and city) is the RIGHT THING. Mr. Aquino does the right thing every day despite the harrassment, ridicule, and all around vitriol he suffers from the other so called “unions”, clowncil, and Mayor Tiny. Ms. Choi has done the right thing (and her job as steward of the pension funds), but she will get the same treatment. I noticed that Mr. Trutanich has been getting bad mouthed and ridiculed as well for doing the right thing. Maybe the people have forgotten what this is called…INTEGRITY. There is very little of that in this town anymore.
The only thing necessary for evil to succeed is for good men to do nothing.\\Edmund Burke
I think the immediate first action is to put pressure on the city by numbers of people. It can’t be the usual letters and phone calls going to the mayor and council’s office. Neighborhood Councils need to speak up and start educating their stakeholders…and they may have to offer to give back back some of their funding.
What needs to be developed is a set of clear,concise and understatable statements that the average homeowner, business person, and private sector employee can understand that we really are at a crisis point. The can has reached the the end of the road.
If the current pensiin plan is approved, 30 cents of every general fund dollar will go towards pensions beginning next year. And, we haven’t finished negotating with public safety yet.
The proposed pension plan CANNOT be approved– taxpayers CANNOT afford to pay 250-350 million dollars over a period of years–to pay a deficit of 250 million dollars for this year alone.
And an excellent chance at a lawsuit.
And PARTICULARLY, when we see that we cannot cut back public safety the way we thought we could as the price tag has increased by 150 million dollars.
And, this is WITHOUT counting the cost of 2 years of pay deferrrals and WITH scheduled 6 pay raises in the next 5 years.
Yeah, yeah–the mayor is a liar and we have the clowncil and we need to secede–but the reality is that this is the plank that that will break the camel’s back, forget the straw!
While the rest of us are scrambling in a economic meltdown, the only voices being heard are union people, including the mayor and council staff people.
And– yeah, yeah–they are paid to be downtown, etc, etc. But the reality is that they are the entrenched power players and WORK for these people.
Loot at what is happening yesterday and today, Bratton re-signs, the federal court tells us that 43,000 convicts have to be let out of prison while 17 year old Lily Burk was killed last week by a parolee.
,…and the fire department is demonstrating saying people are going to die–while public safety contract negotiations are going on–in a very tough year!!!. And what is the biggest fear in the city? Ahhh…dying for lack of service?
Don’t you think that public safety officers want the same contract that the rest of the city got? In case, you forgot–public safety compensation makes up about HALF the entire general funding spending.
One of the twists that I hear is what the fire department is fighting for is those positions that cover the emergency services are all paid OVERTIME.
And we may all remember the DROP program that allowed senior LAPD officers and maybe some fire fighters to draw regular pay AND 90% of pension benefits that ended in 2008.
And, how interesting that Bratton made a point this morning is that he doesn’t make enough in pensions.
The bad news is-pension stuff is BORING!!!! Lets give other a citizens a break–I am interested in the subject, financally literate, and the stuff confuses and bores me.
One of the reasons why Jon Stewart is so sucessful is that he boils national policies down to understandable levels.
I don’t think we have the Jon Stewart equivalent reading this, but the message needs wider dessimination to motivate public action. And, we need high school and college students taking up the cry.
And that message can’t be wonky and the “world is going to hell”. It needs to be understandable and hopeful. Otherwise, we are self satifying peeing into the wind.
29% of payroll for pension next year is already in the cards. That is separate from the ERIP.
You’re right. Does that include public safety at their present level?
Do you remember if she discussed what the added pension costs would be if the ERIPA goes through? As I recall, I heard 91 million outside of the ERIPA from the general fund.
THIS STUFF IS DENSE!!
I don’t have a freakin’ clue what to do about this or anything else the City reps do that aren’t in our interest.
I write op-eds; letters to the editor; my councilman and all for naught.
The only other thing I can think of is to move.
BTW, the media, especially TV, is not going to pick up on this. It’s far too complicated for the mere mortal brain that can’t comprehend anything more complex than American Idol, the latest dalliances of Jon of Jon & Kate Plus 8 or lost, but really not lost, on a desert island.
And…IT AIN’T SEXY!
The Mayor, Julie Butcher, Cheryl Parisi (and their ilk) have really f***ed us now.
2:07 PM Brian D’Arcy and crew kindly request that you grab your ankles as you hand over your wallet. You don’t hear about any concessions from them about their 5.9% salary increase, or the new 3.25% one for Oct. 1, 2009. And you wonder why your water and power rates are increasing? Yeah, for conservation. Use less, pay more…it’s the DWP version of trickle down.
Ron Kaye stated it, but hardly anyone seems to have picked up on something Councilman Parks said: About 20 years ago, there was a lawsuit regarding changes to the pension system, and the outcome of that lawsuit was that, before there can be a change such as the increase in contributions, the ENTIRE membership in the plan must vote on it, or there must be an equal benefit for all members. He then asked what the equal benefit was in this case, and no one at the table could answer. I got it, but it seems Parks is going to need to spell it out for most people: This increase was voted on ONLY by the members of the Coalition — the rest of the employees were not allowed to vote. There isn’t any equal benefit being afforded to those who do not qualify for the ERIP but must pay the increased contributions … therefore, we can conclude that the ERIP as it stands is illegal on those bases alone — forget the cost, it shouldn’t even have gone so far. Mr. Kaye noted this in the article when he wrote: “The city cannot legally make workers pay more for their pensions without their consent or at least giving them equal value for their extra contributions.”
Parks is the only Councilman who really seemed to understand what was going on the other day. Cardenas asked pointed questions about the responsibility of the LACERS board, which was good, but that’s a moot point if the way the ERIP was “approved” prior to its presentation to Council was illegal. Forget Alarcon — he thinks that because a few employees are giving up their COLA’s for the next two years, that this offets the cost. I’ll trade you a penny for a dollar, Councilman; I’ve got lots of shiny new pennies. Even if employees do give up their COLA’s (Cost of living allowance — or more simply, raises) for two years, only the people for whom that salary would represent the highest 12 months’ salary, and ONLY those who retire during the two-year deferral (that is, before the COLA’s are restored) would represent any kind of savings to the pension system — a minimal number, indeed. His example of people retiring 20 years from now and somehow saving the pension plan money because they deferred their COLA’s for two years in the current contract is worse than laughable, it’s embarrassing. In such a scenario there would be no savings at all, because the COLA’s are being deferred for only two years and the person is going to work (and presumably get more raises) for another 18 years. I’d hate to see how he balances his checkbook. As usual, he has to start yelling at people. I guess he still thinks he can disguise stupidity with meanness.
The issue between the unions is also more complicated than just “Everyone Hates Aquino.” He hasn’t exactly behaved in a way that I’d call collaborative with the other unions, and his membership is angry. He is on the right track regarding the ERIP, but then his folks are going to have to come up with a lot of cost-savings in order to avoid furloughs and layoffs.
Fire department? Extortion, anyone? Pay us protection money or your house will go up in smoke. They are already the darlings of the public, and they make huge salaries including overtime, but they still feel they’re above making sacrifices? Prima donnas, all of them.
If ERIP will cost too much money to the City, then save it. Start the lay offs. The current situation of no action is untenable. As for EAA, it is gone come next year.