The following announcement was received from the Piedmont League of Women Voters on proposed state tax measure to help school funding-
An advocacy forum on Proposition 30 on the November ballot will be held on Wednesday, Sept. 19, from 7:30 – 9 p.m. at the Ellen Driscoll Theater, 325 Highland Avenue. > Click to read more…
School District Mourns Death of Chris Stevens, Ambassador to Libya –
Piedmont High School graduate J. Christopher Stevens, class of 1978, the U.S. Ambassador to Libya, was killed in the Sept. 11, 2012 bombing of the U.S. Embassy in Benghazi. > Click to read more…
Budget Committee Sharpens its Pencils –
The Piedmont Unified School District has announced Budget Advisory Committee (BAC) meetings to examine and make recommendations on the district’s budget. The first in a series of meeting will be held on Thursday, September 20, from 3:30 – 5:00 pm in the District Office Board Room, 760 Magnolia Avenue. Members of the committee have not been announced. The public is welcome to attend. The meetings are not expected to be broadcast via KCOM. > Click to read more…
The following letter was sent to the City Council and PCA Editors:
We find it extraordinary the City would go to such dramatic lengths to alter the minutes for the September 4 comments by Mr. Grote [City Administrator] to Ryan Gilbert’s Open Forum comments concerning the misstatement of Council unanimously endorsing the Measure Y Parcel Tax. > Click to read more…
Beach Playfield Restrictions, Athletic Facilities Preservation Fund, and More
The Recreation Commission will hold two public hearing on September 19 with the goal of taking action on two long-standing community issues. The meeting will begin at 7:30 p.m. in the City Council Chambers, 120 Vista Avenue. The issues are:
Athletic Facilities Preservation Fund:
• Introduction/Status Report
• Recreation Program Surcharges
• Community Sports Groups Participation
• Public Testimony
• Commission Deliberation
• Commission Action/RecommendationPrior PCA article.
Beach Playfield Restrictions and Enforcement. (See Prior PCA article: Beach Field Issues.)
• Staff Report
• Chairman’s Comments
• Public Testimony
• Commission Deliberation
• Commission Action
Also on the agenda are
A FUNNY THING HAPPENED ON THE WAY TO THE FORUM-
At the Sept. 4th City Council meeting, I asked to make a comment during the Open Forum, a proceeding required by the California Brown Act. I expressed my belief, shared by one or more staff, that the proposed Parcel Tax (Measure Y) faced failure, primarily because enough residents lacked confidence in the Council’s ability to manage the City’s finances properly.
My perception was that the Council’s actions lacked both sufficient transparency and independent review in the underground fiasco, Blair Park and other matters, resulting in substantial financial losses to the City.
Before I could propose a partial remedy, namely that the City should immediately retain an outside advisor for all employee contracts rather than relying on the City Administrator, Councilman McBain interrupted to state that what I had to say was not “City Business”, but rather part of a political campaign, and thus should not be allowed.
The Mayor deferred to the City Attorney who opined that it certainly was within the scope of City Business and should therefore be allowed. Mr. McBain stated his sole motive was to seek “clarification”. The Council offered no substantive comment.
Mr. McBain, your stated wish not to infringe on the First Amendment is laudable. But you tried to use your position to do just that.
Piedmont citizens should be encouraged to address their concerns to the Council, without prior restraint, and without the patently partisan and astonishing attempt to deny public comment. Mr. McBain, what part of City finances do you think fails to constitute City Business?
Do you truly believe that any citizen, irrespective of political beliefs or streets on which they live, should be subject to an obstructionist request for “clarification”? Was this truly your motivation?
So, if you were contemplating apologizing, apologize to the citizens of Piedmont instead. You should do it. They deserve it.
Aaron Salloway, Piedmont Resident
Editors’ Note: The opinions expressed are those of the author and not necessarily those of the Piedmont Civic Association.
The $1 Million Problem – Temporary or Ongoing?
Piedmont schools face a $1 million deficit in 2013-14. The hope has been that recent Piedmont school financial shortfalls would be brief – a temporary problem created solely by an unexpected 2009 economic downturn. Instead, Piedmont Unified School District (PUSD) budget deficits may represent a longer-standing issue poised to extend into the future.
Prior to 2009, Piedmont school revenues grew every year, but the District’s expenses were growing faster. State Average Daily Attendance (ADA) funding increased each year until 2009. Total revenues also grew each year (35% in the 5 years prior to 2009, according to the Citizens’ Advisory Committee; see p. 45-46 and 19-20.)
Between 2002 & 201o, expenses rose from $20 million to almost $30 million, according to the Budget Advisory Committee chart (shown below). While other budget expenses remained relatively constant (at around $3 million per year), PUSD salaries, benefits and pensions expanded to 90% of the annual budget.
Parcel Taxes Rise to Cover a Growing Gap
Faced with growing expenses, the Piedmont Board of Education requested a substantial increase in school parcel tax rates from voters in 2006. In 2009, a sudden reduction in state revenue led to another request to increase Piedmont’s school parcel taxes. In both 2005 and 2009, voters were asked to allow the Piedmont School Board to levy additional annual 5% increases in interim years between the 4-year city-wide votes.
(The figures shown below do not include bond assessments, which are separate levies. See How do School Bond assessments fit into the picture (updated). Ranges reflect the minimum and maximum levy, based on parcel size.)
Note: Measure B figures do not include the temporary Measure E levies of $219 to $372.
In 2009, Measure B & E supporters argued an increased emergency parcel tax was necessary to offset state revenue reductions, and Measure B taxes would not increase. Opponents objected that parcel tax increases were funding uncontrolled spending growth in addition to making up for revenue reduction:
“While the district faces a cut in state funding (equaling about 3% of the budget), total income will be about the same next year. The real problem is an uncontrolled budget. In the last three years, spending has increased by about $5 million, or about 20%. The average annual increase has been over 6% or about $1.6 million. The problem is historic. In this decade, employee compensation has gone up by almost 60% + in some individual years as much as 9% to 11%. To cover these extraordinary increases the district has more than tripled the parcel taxes.” (See here; emphasis added.)
The 2009 Measure B campaign literature emphasized there would be “no increase in your taxes.” However, the Measure B guarantee of no increase applied only to the first year of the measure and did not extend to future years. Measure B also combined the prior 2005 voter-approved parcel taxes (Measures B & C) with 3 past annual increases imposed by the School Board between 2006 and 2009 (16% total). A total of 6 increases of 5% have been included since 2005, compounding to a 40% increase. The annual increases before and after the 2009 vote, while less transparent and less widely recognized than the 4-year ballot measures, nonetheless contribute to parcel tax growth. Homeowners do not receive annual written notice of the School Board increases.
Measure B was approved, as well as Measure E, a temporary emergency flat tax of $1 million for a period of 3 years, to bridge state revenue reductions.
The 2009 vote by residents was significant in 3 ways. First, the voters ratified past annual increases imposed by the School Board. Second, voters did not provide a mandate for future Measure B levies above the 2009 level (since the campaign was based on the assertion “your taxes will not be increased.”) Third, approval of the 2009 rate was followed by a February 1, 2010 Citizens’ Advisory Committee Report which noted adjustments to school programs and personnel were still required to increase cost efficiency – adjustments to create a stable “long-term financial plan” first requested by the School Board in 2006.
Read More in this series of articles examining Piedmont School Finances:
Comparison to other cities indicates high Piedmont costs –
Backers of Measure Y try to scare voters into supporting the parcel tax by claiming that loss of the tax threatens critical public safety services, especially the fire department. So it’s worth asking the question, “How do Piedmont fire department staffing and costs compare with similar small, affluentcities?” Not favorably, is the short answer.
In its report to the Council last year, MTRC prepared summary budget comparisons with several cities. We have updated the information to currently available budgets. For fire protection, the comparable cities (those with their own fire departments, not consolidated with other jurisdictions) were Larkspur, Mill Valley, San Marino, Sausalito and Albany (fire chief shared with Piedmont).
Piedmont’s population is 10,667, compared to an average of 12,622 for the other cities. The most striking comparisons between our fire department and those of the other cities are as follows:
To summarize the links between the different bits of data, Piedmont is almost 20% smaller than the average of the other cities, yet its fire department has 26% more staff. As a result, fire protection in Piedmont costs 53% more per dwelling than the average, and the ratio of houses protected to fire department employees in Piedmont is only half of the other cities. The surplus cost for fire protection in Piedmont is nearly equal to the amount of revenue raised by the parcel tax.
The fire department in Piedmont has two central functions: fire fighting and ambulance/paramedic services. The ambulance portion of the budget is about a quarter of the cost of each shift, and responding quickly to paramedic calls is one of the city’s highest priority services. However, in a city that experiences, on average, about one house fire per year, it is reasonable to question the premium paid for our overall fire department size.
The city of Albany, with whom we share a fire chief, has almost twice Piedmont’s population and number of dwellings, and a larger area. Yet its fire budget is 15% less than Piedmont’s and the personnel count on a regular fire shift is 25% smaller. The comparisons are striking and deserve detailed examination by our City Council.
For more information on the parcel tax issue, go to www.NoOnMeasureY.com.
Michael Rancer, Chair of Piedmont’s 2011 Municipal Tax Review Committee
Editors Note: The opinions expressed are those of the author and not necessarily those of the Piedmont Civic Association.
New CalPERS rules impact new hires, leaving cities to struggle with current employee costs –
Last week the California State legislature adopted AB340, a pension reform measure that will apply to the City of Piedmont. The reforms impact CalPERS pensions, primarily for new hires. Pension costs for current employees and existing unfunded liabilities are not addressed. (See Pensions 44% and Rising.) For Piedmont and other local entities, no significant cost savings will be seen in the near future.
Wall Street Journal: “The reforms reduce benefit formulas for new workers and require employees to pay half of the “normal cost” of their pensions. However, that doesn’t include the cost of paying down unfunded liabilities, which is what’s really sending local pension bills through the roof. Municipalities also won’t realize material savings until new employees retire in another two to three decades . . . .”
Legislative Analyst: “Since increasing current employees’ contributions is one of the only ways to substantially decrease employer pension costs in the short run, the legal and practical challenges that we describe mean that the governor’s plan may fail in its goal to deliver noticeable short-term cost savings for many employers.” . . . “
Calpension.com – For cities using CalPERS, AB340 “extends retirement ages, caps pensions and gives new hires a lower pension by imposing a single formula (rolling back increases after SB 400) instead of allowing bargaining on a menu of different formulas. The legislation calls for a 50-50 split of “normal” pension costs between employers and employees [for new employees]. As current contracts expire, if unions do not agree to equal cost sharing in bargaining by 2018, cities can impose an employee contribution increase.
The Wall Street Journal asserts the reforms were designed to help pass Governor Brown’s new tax measure, Proposition 30, in November, but “retirement costs will soon consume all $8 billion that politicians hope the ballot measure will raise” rather than helping school budgets.
Collective bargaining by public employees has been allowed in California since 1978.
The League of California Cities supports a “hybrid” pension plan that would cap defined benefit PERS pensions at 70 percent of base pay and supplement with a professionally-managed defined contribution plan. See details.
AB 340 changes primarily affect new hires
(Note: In 2004, the City of Piedmont increased all employees pensions by 50% retroactively. See PCA pension article. These past increases are not reduced by the reform measure.)
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