Despite Rhetoric to the Contrary They Did No Favors to City Employees
The public has focused its attention on this point about nine layoffs by the city manager of employees in the DCEA (Davis City Employees Association) bargaining group. Some have focused squarely on the layoff of a tree trimmer.
One can question the timing of this decision. One can question whether it should have been a tree trimmer. But what one needs to understand is that this has been a long time in coming.
This year, for the first time perhaps, we will pay the full price for the excesses of the previous decade. The reliance on the real estate bubble generated double figure property tax increases, and there was the passage of the half-cent sales tax, but there was also the stonewalling and whitewashing of reality.
The budget calls for $7 million in cuts, in addition to the nearly one million imposed on DCEA following the failed impasse and failure of that group to take minimal concessions along with all other bargaining units.
Pain and misery will be sure to follow. Many of it will be visited upon innocent victims.
This column will argue that this has come to pass because not only did council majorities, including Don Saylor, Stephen Souza, Ruth Asmundson and at times Ted Puntillo, pass unsustainable policies between 2004 and 2008, but they failed to act quickly enough even when the economy had collapsed and everyone knew what was coming.
It came to pass because former City Manager Bill Emlen lacked the fortitude to tell the public and the council the truth. It has come to pass because former Finance Director Paul Navazio, though he knew the truth, rarely spoke it in public. Due to these repeated acts of misdirection and omission, both Emlen and Navazio violated the public’s trust.
It has come to pass because Harriet Steiner, the city attorney, violated the Meyers-Milias-Brown Act, the tenet of collective bargaining law.
People need to understand this and understand unequivocally, people’s lives are going to be damaged if not destroyed, because of the political ambitions of some and the cowardice of others.
As this column will show, there were multiple opportunities in the past five years to stop this, slow this, prevent this – and each time, there were different reasons for failure and, at times, it was from surprising sources.
The 2008 city council elections saw three incumbents re-elected. Four years later the entire city landscape had changed. A month from now, not one of those individuals will be on the city council.
Those who argue that the budget changes are the result of the economic collapse missed out on the lively but ultimately fruitless debates of 2008. In those discussions, incumbents Don Saylor and Stephen Souza were bragging about their budgetary accomplishments and the fact that they had achieved fiscal stability and sustainability.
After all, they argued, they had a balanced budget with a 15 percent reserve.
But that wasn’t the full story even then, in the days before the economic collapse brought the US economy to the brink of total system failure.
You see, Sue Greenwald and Cecilia Escamilla-Greenwald (the former no relationship to this columnist, the latter my wife) saw a very different picture. It was a picture of $13 million in unmet infrastructure needs. A picture of $50 million in unfunded liabilities to retirees for health care. A picture of millions in growing liabilities due to retroactively-enhanced retirement pensions.
Don Saylor and Stephen Souza dodged these issues, the voters ignored them, and the incumbents, including Sue Greenwald, were all reelected.
The election was unfortunately held about three months too soon. By the end of the year, with the economy in ruins, the problems became evident to most.
The city manager at the time, Bill Emlen, reacted to the downturn by acting as though this would be a temporary crisis. He cut hours, had furloughs and cut services. He reduced payrolls through attrition.
The bigger issues were left for the first full budget of the crisis in June 2009. This was three years ago, and over the next year; the council would negotiate contracts for the bargaining units.
The budget plan developed by Paul Navazio and Bill Emlen called for just $850,000 in savings through reduction in compensation to employees, representing just a 3% cut. In addition, the plan called for another $1.5 million in what would become infamous tier reductions – cuts to service and reduction of employees, mainly through attrition but also with a few layoffs.
The budget did not address cuts to pensions, retiree health or cafeteria cashouts in a sufficient way.
Councilmember Lamar Heystek would attack this plan by proposing his own. Instead of 3% reduction in employee compensation, he proposed 5%, or around $1.575 million.
Without getting into too much detail, Mr. Heystek also attacked the budget revenue assumptions as being unrealistically optimistic, and while Mr. Saylor would attack Mr. Heystek’s numbers, stating that he would prefer to use Paul Navazio’s “real” numbers, history would prove Mr. Heystek’s numbers far more realistic.
That point aside, the key here is to what happened with employee compensation numbers. In 2009, the City Manager and Finance Director called for $850,000 in cuts, while Lamar Heystek called for $1.575 million; they eventually compromised at just over $1 million.
But the reality is that they never even got to $850,000.
As we saw in December 2009, the firefighters contract, which was passed 3-2 by the council majority of Ruth Asmundson, Don Saylor and Stephen Souza, was opposed by Lamar Heystek and Sue Greenwald.
In a heated discussion, Councilmember Sue Greenwald pressed the Finance Director to explain where the inflated savings figures came from. During the course of that discussion, Councilmember Greenwald demonstrated that the level of savings was actually considerably less in year three than the 3.6 percent trumpeted by city staff.
Sue Greenwald told the council: “The savings from the base year to year three of this contract was only $57,000 which is .82 percent not 4%, 6%. So there’s a lot spin in how we’re presenting this.”
She continued: “I really take issue with this $800,000 savings, this is a savings that’s a savings that is over and above your projection.”
As she pressed the issue, Mayor Ruth Asmundson abruptly cut off the debate and the council voted 3-2 to first not have a 30-day sunshine period and refer it to the Finance and Budget Commission, and then to approve the contract.
In addition to cutting off debate, which likely was a prelude to the explosion by Sue Greenwald during the debate over the PASEA (Program, Administrative and Support Employees Association) contract, the council majority used phony numbers to get there.
In January 2010, the council by a 3-2 vote approved the MOU for the “management group,” the group of people below department heads who were in managerial positions.
The council majority of Stephen Souza, Don Saylor and Ruth Asmundson, along with City Manager Bill Emlen and Finance Director Paul Navazio, argued that this contract represented a savings of $744,000.
How did they figure? Well if you extended the current contract with the rates of increase in that contract over the course of this contract, they would save that money.
Councilmember Souza argued, “This is a $744,000 savings over what people are being paid right now. What they’re being paid in the baseline in salary and all-funds benefits this is a savings of $744,000, that’s the math I was taught in school. And that’s the math that I see when you add the numbers up. Calculating what is being paid on an annual cost this year, or salary from last year, if you look at 08-09, it was $8,638,000. You multiply that times three you end up with $26,414,000. If you take the contract, all funds, in this MOU, you have $25,670,000. That is a savings of all funds of $744,000. I think that’s all funds that we’re talking about, not just salaries.”
The math I learned in school tells me that $8,638,000 multiplied by three is not $26,414,000, rather it is $25,914,000. You subtract this MOU from that and you end up with $244,000 in real savings over the next three years, not $744,000.
Mr. Souza would make the argument that you cannot turn around the budget immediately.
He argued, “That is a changed, that is a change, there is two analogies that have been used here tonight and I’m going to use both of them to turn them on their head. The first one is the analogy that you can turn something around immediately. That is a ski boat. This city and the progression over the last 30 years, and I’ve looked at contracts going back to ’96, has been a progression that has gotten us to the point, from all the councils, up to this council, where it was continually upward, in benefits, in salaries. This is the first contract that is the beginning of the turning of this aircraft carrier. And it takes a long time to turn an aircraft carrier around for anyone who has ever been on one, it doesn’t happen overnight. Doesn’t happen quickly, it takes awhile.”
He continue, “I would have loved to have seen a much further turning of this aircraft carrier in this year, but I’m happy that I’m on a council that has begun that movement and that turn in the direction of the citizens of this community that are paying those salaries and benefits.”
Councilmembers Greenwald and Heystek were simply arguing that we could have gotten a better deal and Mr. Souza’s analogy did little to disprove that contention.
So the key point to take from this is that the council majority set up minimal goals for budget cuts, and failed to meet them.
In 2009, the price tag was just $850,000.
In May of 2010, the Davis City Council voted unanimously to impose the City’s last, best and final offer to the city’s largest bargaining unit, the Davis City Employees Association (DCEA).
From the city’s perspective, DCEA was simply unwilling to go to the bargaining table and negotiate in good faith. And while other bargaining groups accepted concessions, most of which the Vanguard has argued fell well short of what was needed to have occurred, our understanding of DCEA is that their last, best and final offer to the city fell well short of even those.
As we now know, the city failed to properly carry out fact-finding under the Meyers-Milias-Brown Act. We have noted in the past that is on the city attorney. And it will cost the city roughly $800,000 in back pay, which they will fund through nine layoffs.
As we noted, the contracts that the city passed were insufficient to save the city from fiscal calamity, but DCEA was not even willing to get to that point.
In June of 2010, things began to change in the city. Lamar Heystek, who had been a stalwart on the budget, decided not to run again. Ruth Asmundson, who was a disappointment most of the time on the budget, despite on a few key votes defecting from Councilmembers Souza and Saylor, also retired.
That opened the door for Joe Krovoza and Rochelle Swanson to be elected to a new council with Don Saylor as mayor. It was not until Don Saylor resigned to be seated on the County Board of Supervisors and Dan Wolk was appointed in his place (in February 2011) that things began to change.
In their first budget, by another 3-2 vote, this time with the old guard of Stephen Souza and Sue Greenwald dissenting, this council passed a budget that cut $2.5 million from personnel compensation. 150 stunned employees came out. And why shouldn’t they have been stunned? They had had the rhetoric from City Manager Bill Emlen and the council majority telling them that everything was all right and that we could balance the budget through attrition and tier cuts.
“We have maintained the level of reserves in the city budget at about $5 million or 15% despite all of the bad stuff that’s been going on. That tells you that the city is not going broke, but we have things looming out there that could certainly further stress our budget,” City Manager Bill Emlen said in early 2010 during his “State of the City Address.” His message was that while things were challenging, Davis had weathered the storm better than most communities. He highlighted the positive, downplayed and minimized the negative.
Listening to his speech, who would ever have believed that the city would have passed the budget that they did just a year and a half later, or that in 2012, we would have a budget that cuts $8 million? As we said, that fiasco is largely due to his lack of leadership and his failure not only to make the tough decisions, but also to prepare the public and his employees for the tough decisions.
The idea was to transfer the money toward fully funding retiree health, putting some of it toward an expected PERS (Public Employees Retirement System) rate increase, and put $1 million to finally fund the infrastructure needs that had been growing since 2008.
However, Councilmember Sue Greenwald, who had been so strong on the budget, broke with the majority, arguing that we needed to impose these cuts in 2012 when the MOUs come up.
Councilmember Greenwald said that she has been fighting for these kinds of cuts for six years, but we are in the middle of a labor contract and there is little we can do.
Councilmember Souza added that they are all “singing the same song, just a different tune, different tone,” adding, “Personally I think there is a better way to get there.”
Councilmember Souza argued “We shouldn’t fool ourselves into thinking that we are going to achieve $2.5 million without people losing their jobs.” Unless there are concessions, negotiated people will lose their jobs. He argued you “don’t say you are going to talk to you [sic] at the same time you are targeting them.”
He said he wanted true constructive dialogue and believes the prior path was the right path. “This one is not the right path.”
A number of things happened to prevent these cuts from being implemented. For one thing, the employees refused to talk concessions. For another, Paul Navazio never seemed to buy into the cuts.
And when Steve Pinkerton came aboard in early September, the September 6 meeting meant that water and not the budget would take his immediate focus.
The result is that those cuts for a variety of reasons were never implemented.
The pigeons have come home to roost. In 2009, we cut just $850,000 from employee compensation. Lamar Heystek believed it should have been $1.57 million. The council majority balked at that figure.
In 2011, that number was $2.5 million. A number that was too high for Mr. Souza or Ms. Greenwald.
Now Mr. Souza and Ms. Greenwald have been defeated in their re-election bids.
The budget of 2012 calls for that number to be $4 million in cuts, with another $1 million cut from DCEA and another $3 million cut from reorganization work.
What happened is two things. First, we kept forestalling what we knew in 2008 needed to be done – we knew that we needed concessions from employees on salary, on pensions, on retiree medical and on cafeteria cashouts, and we got very little. We kept pushing off the tough decisions until the future.
Second, the Vanguard kept warning, even as early as 2008 and 2009, that the big hits were still to come and we figured out by 2015 we would have to massively reduce costs.
We were right. History has proven that our warnings of four years ago were accurate, and because city management and city council majorities did not act then, the cuts are going to be deep and painful, and they will cause hardship for many employees who, quite frankly, are guilty only of trying to put food on their table. It is sad that it has come to this, but we have warned the public for some time.
—David M. Greenwald reporting
Folks: It’s father’s day, I’m doing only one article today and it took me four hours to write this one.
But if you only read one article its entirety this year, at 2500 words, this should be the one. It shows us how we got where we are.
We went from $850,000 in employee compensation cuts in 2009 to over $4 million this year.
Happy Father’s Day David…..and all the rest of you Dad’s !
Enjoy the day David!
Particularly for those Dad’s (and Mom’s) slated to be demoted or laid off by implementation of last Tuesday’s budget proposal.
[i]”Particularly for those Dad’s (and Mom’s) slated to be demoted or laid off by implementation of last Tuesday’s budget proposal.”[/i]
Most of those being laid off have real, marketable skills*. That is certainly true of the two tree trimmers. If they are hard-working and motivated, they will have no trouble (even in a weak economy) getting work in their profession. What they will find, of course, is that the money they are actually worth per tree trimmed in total comp is far, far less than what government pays.
*The people who work for the City and have government-specific skills, such as those who process regulatory paperwork or are trained in city-planning and so on, are s.o.l., unless they want to move out of California. … I thought this category of unhireables would include firefighters, also. However, a friend of mine (who is a petroleum engineer in Texas) told me that the natural gas drillers and oil refiners are hiring firefighters, now. The difference is they will make half as much, with no pensions, and they will not be paid to make runs to the supermarket.
No disagreement with you Mr Rifkin. They reality is that they have adjustments to make, that some of us don’t, and I wish them well, and hope they have a good Father’s Day as they move forward. I hope you would not deny them positive wishes for them and their families as they move forward.
I don’t necessarily disagree w a lot of this analysis, but there a few statements that bother me.
[quote]Don Saylor and Stephen Souza dodged these issues, [u][i][b]the voters ignored them[/b][/i][/u], and the incumbents, including Sue Greenwald, were all reelected.[/quote]
I don’t necessarily think “the voters” ignored these issues. I know this voter did not ignore them, and I know many other voters who did not. Oftentimes “the voters” didn’t have very much in the way of good candidate choices to pick from – that were not bad or worse choices than the incumbents that were running for re-election. (Don’t want to name names, at this point – no point in tearing people down unnecessarily.) I really don’t think it is fair to blame “the voters”, whatever the heck that means (in my view it is an overgeneralization and very unfair). To prove my point, finally when some better candidates did come along, the voters spoke loud and clear they wanted some serious change. Frankly, I think some have realized if they don’t push good candidates forward to run for office, then we are doomed to receiving very poor leadership. I am happy to say some excellent citizens have stepped up to the plate and are willing to take on the onerous task of running for City Council seats, and have won their elections – hopefully for the betterment of the community… and I am very grateful for their willingness to do so… we desperately need them.
As for the budget issues in general, let’s take a step back and look at the bigger picture. One issue that has not been noted in this article, is the “keeping up w the Jones” mentality that has pervaded all of CA and is endemic across the nation. This cockeyed idea that as a city, the best qualified people are necessary and the most expensive – thus cities have to keep raising salaries to get the best qualified people. And low and behold, eventually those salaries start to become unattainable, spiraling ever upward. This phenomenon is not exclusive to Davis or to CA. And it is an issue that is very necessary to grapple with. The basic point is that a city should only be paying for [u][i][b]what it can afford[/b][/i][/u]. But it seems as if our city lost its way and never got this point – but neither did the nation as a whole. This city was engaging in practices that probably the majority if not most other cities were engaging in. That does not mean I allow the various players in our city’s debacle off the hook – far from it. But I think a new paradigm of more sensible budgeting has to take place from hereon in – to only pay for what we can truly afford…
[quote]As we now know, the city failed to properly carry out fact-finding under the Meyers-Milias-Brown Act. We have noted in the past that is on the city attorney. And it will cost the city roughly $800,000 in back pay, which they will fund through nine layoffs.[/quote]
As hpierce has pointed out, we really don’t know specifically [u][i][b]who[/b][/i][/u] is to blame for the impasse debacle. I wouldn’t jump to any conclusions without some more investigation…
And lastly, in my own view, the buck stopped w the City Manager. It was he who set the tone, gave the advice to City Council, told them and the city employees what they wanted to hear. It was he who should have had the courage and backbone to tell “the truth, the whole truth, and nothing but the truth” and let the chips fall where they may. My dealings w him were suboptimal, at best, and I won’t say anymore on that score. Again, that does not mean I let certain actors on the budget stage off the hook. But in my view, had Bill Emlen been more forthright in his dealings, not strong-armed anyone who dissented, and vigorously quashed dissent, the city might be in better shape now. Had Bill Emlen told the unvarnished truth, it would have been much more difficult and politically dangerous for the City Council members to ignore the actual situation as presented. JMO
Happy Father’s Day to my Dad at 86 years old, and Happy Birthday to my youngest daughter, who just turned 27. I have a lot to be thankful for…
“People need to understand this and understand unequivocally, people’s lives are going to be damaged if not destroyed, [i]because of the political ambitions of some and the cowardice of others.”[/i]
What a damning thing to write. I appreciate your reporting David, but the times are calling for a different type of mentality. Yes, mistakes may have been made in the past, but we need to be looking forward, not backward. I’d love to see a piece that is inspiring and hope-filled.
What is a positive vision you could cast for the community to live into? That’s what I think is needed most of all right now.
[i]”As hpierce has pointed out, we really don’t know specifically who is to blame for the impasse debacle.”[/i]
This is incorrect. We know beyond any doubt who specifically is to blame for the impasse mistake. It is City Attorney Harriet Steiner.
Let me quote the PERB decision of Chief Administrative Law Judge Shawn Cloughesy, which you may have not read: [quote]The City’s canceling of the fact-finding dates on May 25, 2010 therefore constituted an unlawful implementation of its LBFO before exhausting impasse procedures in violation of MMBA section 3503, 3505, 3506 and 3509(b) PERB regulations 32603(a) (b) (c) and (g), and EERR Article XVII*. [/quote] *EERR XVII is the City Ordinance 1303.
In Judge Cloughesy’s report is a quote from Harriet Steiner which makes it perfectly clear that she advised the City on May 25, 2010 to unilaterally cancel the fact-finding and to implement its LBFO (last, best and final offer). Here is what Ms. Steiner said:
[i]“The City has a set of rules on the process to follow after impasse. The City and DCEA bargaining group have met with a mediator without success. The next step is to come to City Council or go to fact-finding arbitration; [b]Council may impose a last, best final offer on a unilateral basis if it believes further process is unavailing. Staff recommendation is to impose a last, best final offer as rules apply to DCEA. …”[/b][/i]
There are serious legal problems with what Harriet said:
1. “The next step is to come to City Council or go to fact-finding arbitration.” No. Those are two different steps. Going directly to the City Council is optional, however. From Ordinance 1303: “If the parties fail to agree to submit the dispute directly to the City Council, the said unresolved issues shall be submitted to fact-finding.”
2. Steiner claimed the City could act unilaterally without the fact-finding process completed (it would have cost staff time and taken a week or two), if it “believes further process is unavailing.”
There is a huge problem with that conclusion. The Davis ordinance does not say the City can act unilaterally without fact-finding completed or if it believes the process is unavailing. The words unilateral and unavailing are not in the Ordinance. Also, there is no case law (in PERB) to support Steiner’s claim.
The City Council acted as it did following the City Attoreny’s advice. Her bad advice is to blame. It cost the people of Davis $804,000; and now 9 people their jobs.
VANGUARD: [I]”In their first budget, by another 3-2 vote, this time with the old guard of Stephen Souza and Sue Greenwald dissenting, this council passed a budget that cut $2.5 million from personnel compensation. … In 2011, that number was $2.5 million. A number that was too high for Mr. Souza or Ms. Greenwald.”[/i]
I don’t think that is an accurate portrayal of Sue Greenwald’s position. Her contention (and mine too, at that time) was that a unilateral cut of $2.5 million from the personnel budget would mean a steep reduction in city services, and Sue believed that was the wrong approach.
Her belief (which I agreed with) was that we should try to retain (or even increase) city services, that the people of Davis expect a sufficient number of police officers on patrol, expect the garbage cans in parks to be emptied, expect programs for children and the elderly, etc. And that by just whacking out $2.5 million from personnel, that would inevitably lead to much worse city services.
Sue’s belief (and mine too) was that the core problems with the city budget were in the labor contracts, and therefore the solutions to the problems would be found in reforming those contracts. Sue said at the time (though I did not agree with this) that by cutting out all of the jobs that David Greenwald advocated cutting the result would be much less pressure to reform the labor contracts, and thus it would end up putting off a resolution of our real problems.
Mysteriously to me, David Greenwald has long said that “$7 million cannot be cut from the contracts alone.” I believe David does not quite understand what is in the contracts and what needs to be changed and what those changes will bring about in terms of dollar savings.
As David knows, the key solution (though not the only needed reform) to the labor contracts is to target total compensation and regulate the nominal growth in the cost of labor by capping the amount total comp can grow, especially in the period in which the cost of pension funding is rising at an unaffordable rate.
I am so disappointed in our educated electorate.
Sue Greenwald is one of the few members of the council, in the many years I’ve lived here, who was not looking at the job as a stepping stone to higher office.
Only she and Heystek tried to look out for our interests on the compensation questions. They were not looking out for reelection support (on the council & higher office) from employee unions and their families.
Why wasn’t she reelected? I would guess the reason, aside from lack of funding is:
She doesn’t fit the Davis, friendly, neighbor next door neighbor mold. The image many are comfortable with. Ms. Greenwald is pugnacious and a stickler for accuracy and truth. She does her homework. That plumbers’ union add may have helped or hurt her chances — but, it was clever in sensing that Davis voters were upset by having council members “who didn’t get along”. “It’s not the Davis way”.
[quote]”(Harriet Steiner’s) bad advice is to blame. It cost the people of Davis $804,000; and now 9 people their jobs.”[/quote]How is the need to find yet another $804.000 necessarily tied to Harriet’s screwup. If the city manager and the council decide to fire people to make up an overall budget shortfall, doesn’t tying it to Harriet’s error do the same thing that David’s targeting personnel costs did?
Isn’t $804,000 just money in a giant pot, regardless from where it’s now extracted? The city could reduce street maintenance, close a couple pools, decrease rainy day money, etc., to cover the shortfall. Harriet deserves lots of humiliation her bad call(s), but the council decided not to even discuss them as they rehired her firm yet again.
Maybe every city employee could take off for a month to make up for the other problems Harriet’s dumping on us, including the DACHA fiasco.
“I really don’t think it is fair to blame “the voters””
I’m not blaming the voters, but the issues were raised in public during that campaign. The voters chose to vote for the incumbents. Three months later, I think it would have been a very different story. Just my view on that.
“we really don’t know specifically who is to blame for the impasse debacle. I wouldn’t jump to any conclusions without some more investigation… “
I disagree with you. Harriet Steiner has one job to provide the city with legal advise. This was not a particular close call. Had she said, I think an ALJ will strike this down, I don’t have any reason to believe that the council would not have listened. I know for a fact that she did not do that.
“I don’t think that is an accurate portrayal of Sue Greenwald’s position. Her contention (and mine too, at that time) was that a unilateral cut of $2.5 million from the personnel budget would mean a steep reduction in city services, and Sue believed that was the wrong approach. “
I stated that in a different paragraph that you did not quote from, but as you implicitly acknowledge it was the steepness of the cut, had it been a small amount I suspect you and she would have agreed.
In the end, I think all this does is make the cuts steeper.
“Mysteriously to me, David Greenwald has long said that “$7 million cannot be cut from the contracts alone.” I believe David does not quite understand what is in the contracts and what needs to be changed and what those changes will bring about in terms of dollar savings. “
No, I think I have a good idea and even if I didn’t, we got a taste in the fire management contracts.
“What a damning thing to write. I appreciate your reporting David, but the times are calling for a different type of mentality. Yes, mistakes may have been made in the past, but we need to be looking forward, not backward. I’d love to see a piece that is inspiring and hope-filled. “
With all due respect, I don’t know how you can be hope-inspired at a time when we are laying off at least 40 city employees and cutting $7 or $8 million from the budget.
People made a lot of mistakes, we need to acknowledge them to avoid repeating them, and we need to acknowledge them because people are going to lose their jobs because of them.
Those unfortunate facts.
I’m grateful to have seen a council and city management willing to make these kinds of tough decisions, but you are not going to see hope inspired pieces from me at a time like this.
This is going to be a miserable few months for many in our community. THe worst part of it, is that with better management and quicker action a lot of this could have been prevented.
“How is the need to find yet another $804.000 necessarily tied to Harriet’s screwup. “
Have to cover the $800,000. How are you planning to do that if not by layoffs?
I very much appreciate the specificity of Rich Rifkin’s analysis of the PERB documents. It helps me track the events and the responsibilities.
Actually, I would argue Harriet’s PERB advice cost citizens more than the $804,000 up to a million as some have suggested.
I have seen it somewhere but I believe that the City Council chose not to have Harriet do the appeal but it then needed to hire another law firm to do the appeal.
I think that new law firm cost us citizens about $125,000. I have no idea whether that was a fixed contract or that $125,000 is what we have paid so far.
So then look at what Harriet was paid to do the labor negotiations, what she was paid to go through the process and what she was paid to assist the new law firm in putting together the appeal.
So what are the costs of Harriet’s work on the issue, the new law firm’s work on the issue and Harriet’s additional work because of and through the appeal process? I suspect legal costs are about $200,000. The Council should make it known what were the legal costs associated with this PERB issue and also importantly where did the funds to pay the legal costs come from?
The new Council needs to provide a higher level of transparency?
David Thompson
[i]”How is the need to find yet another $804.000 necessarily tied to Harriet’s screwup.”[/i]
Judge Cloughesy ruled that the City of Davis needs to make the DCEA whole by paying back its membership all the money they lost in wages, benefits and so on when the City imposed its LBFO on the DCEA. The $804,000 number is (the City’s estimate of) how much the City will have to pay. The penalty also includes full pay for days DCEA was ordered to take as furlough days off.
Here are the Judge’s words on the matter: [quote] In cases of unlawful unilateral action, PERB generally orders employers to rescind its unilateral action and restore the status quo ante as it existed prior to the violation. It is therefore appropriate to order the City to rescind Resolution 10-070 and reinstate the terms and conditions of employment prior to the passing of the May 25, 2010 resolution. It is also appropriate, that the City be ordered to make bargaining unit employees whole for any losses they may have suffered due to the City’s unlawful unilateral action, along with interest at the rate of 7 percent per annum until such time as they are restored to their former position prior to May 25, 2010.[/quote]
[i]”No, I think I have a good idea and even if I didn’t, we got a taste in the fire management contracts.”[/i]
Just for the record, the modification of the fire management contract was largely my doing. An unmodified and unreformed version of the new contract was scheduled to be approved on a consent calendar vote. After exchanging a number of emails with members of the Council (mostly Joe and Dan and one or two with Rochelle), I told them what changes needed to be made. The Council then took the unreformed contract off the calendar, and later came back with the changes I had suggested. What I explained at the time was the reformed contract, even though it did not apply to anyone then working for the City of Davis, would serve as a blue-print for the changes in all other City contracts.
[i]”Maybe every city employee could take off for a month to make up for the other problems Harriet’s dumping on us, including the DACHA fiasco.”[/i]
For the record … I have never really looked into the legal case with regard to DACHA. I have never opined that the City’s position is legally strong or weak, or that the former DACHA residents have the law on their side or not, or that Neighborhood Partners or Twin Pines Cooperative is right or wrong when it comes to the law in that case.
David Thompson, has requested numerous times in writing that I meet with him to discusss the specifics of how NP + TP was wronged. We recently bumped into each other in person and he again (very politely) made the same request.
Having just had some major surgery, I am not up for that for a while. But I will eventually take up Mr. Thompson’s request. I should try to get a grip on the legal aspects of this case.
As the NP + TP people know (and as Just Saying knows), I have, nonetheless, been highly critical on a moral (not legal) basis of how and why I believe DACHA was set up. I know that NP created DACHA and set themselves up as its consultants. I know that the design created profits by way of fees for that consultancy.
Even if every aspect of the legal case is in favor of NP + TP, I don’t think that excuses creating a structure which benfitted the developers and took advantage of the naivete (or maybe even foolishness) of the low-income residents. I have no moral problem (most of the time*) in a free market with business people making profits (as long as they don’t engage in fraud). But when you are in the low-income housing game and government money is paying a large fraction of the costs, it simply strikes me as immoral to create a structure and operate a business which hurts those without money and helps those who already have plenty.
*There are a few exceptions to my morals clause, even in free markets. I don’t think, for example, that whoring should be illegal. But I don’t think being a pimp is ever moral, even if the ladies are adults and freely choose to be whores. I feel the same way about those who operate lotteries. They are simply exploiting the stupidity of those who waste their money buying tickets. If a person who makes a good living buys a handful of tickets each week, no big deal. If a man who owes child support but cannot afford to pay it buys lottery tickets, it is a question of morality selling him tickets.
I think the thread here is Harriet’s duties and responsibilities as counsel to the Council.
FOr me that thread began with the Council adopting a set of policies about the manner in which the “for sale” affordable homes would be dealt with. In a post a while ago I showed HArriet’s letter to the council explaining all the details (As Rich Rifkin did with PERB) of what the Council had adopted and when relating to the “for sale” affordables.
Similar to the PERB ruling, Harriet did not complete the tasks as the Council had outlined, detailed and required. As a result, the City had no protection against the abuses that ensued. The result, Harriet admits she “forgot” to apply the requirements to the trust deeds and the City lost out on sharing in the $11 million dollar gain of 52 homes in Wildhorse and other “for sale” homes as well.
We citizens lost out on a minimum of $5.5 to probably $6 million dollars in a City asset to use for housing starting in 2002.
How much did that loss cost us for the past ten years and going forward permanently?
But no action by Council just as seemingly no action with PERB.
David Thompson
PS: I did see Mr. Rifkin and introduced myself and then asked politely if we could meet. I am grateful that he also politely agreed to get together at a later time to review DACHA. I thank him for his gracious response.
Good article David,
If anything was predictable, these government debt problems at all levels (local, state, federal) was.
Of course when there are boom times there will also be bust times, there are no exceptions in history.
Seems to me what might bankrupt governments are the unfunded pension obligations, which will continue to balloon, we can no more afford this than Greece. The way the system is set up, politicos can approve generous pensions and benefits with no loss to their own approval rating, since the price the taxpayer has to pay for this generosity is a couple of decades into the future. By then, these politicos have glad-handed themselves somewhere else, and they pay little or no price for their opportunism and folly.
Ironically by past pension contracts being made so generous; if the government body that guaranteed it is in danger of bankruptcy, through forced renegotiations these pensioners may get only a small fraction of what they were originally contracted for. What about moderation; no pension collection starting until 65-70 years old, and a modest pension? If you want to tour the world, you are welcome to have saved the money on your own to do so; should not expect taxpayers to give you a pension to do this. Unfortunately now since we have overshot on pensions; many other workers without these packages will need to work until their early 70s; part of their tax money will go to fat pensions for those in their 50s.
concernedcitizen
[quote]”People need to understand this and understand unequivocally, people’s lives are going to be damaged if not destroyed, because of the political ambitions of some and the cowardice of others.”
What a damning thing to write. I appreciate your reporting David, but the times are calling for a different type of mentality. Yes, mistakes may have been made in the past, but we need to be looking forward, not backward. I’d love to see a piece that is inspiring and hope-filled.
What is a positive vision you could cast for the community to live into? That’s what I think is needed most of all right now.[/quote]
I agree with you that a positive vision is very much in order now for our community. In my experience, the most positive outcomes are achieved when people are willing to come together to achieve an agreed upon goal such as helping someone in need. I have a modest proposal to make.
I would recommend that those who stand to benefit from the $800,000 or so that will be restored to them as a result of the errors of the city leadership set aside a portion of that money to start a community wide matching fund to aide those who are losing their jobs and their families. I know that, I for one, would be more than willing to contribute to such a fund if their fellow DCEA members, and especially their leadership would be willing to do so. Unfortunately, I do not have the know how to for setting up such a fund but am sure that someone in the community would have the knowledge of how to do this. How about it DCEA members and other city employees ?
Seemingly, another million dollar mistake by Harriet. A minimum of $804,000 and about $200,000 in additional legal costs (new firm plus Harriet helping).
And none of the five Council members pulls Harriet’s contract from the consent calendar to at least discuss it.
David Thompson
[i]” I know that, I for one, would be more than willing to contribute to such a fund if their fellow DCEA members, and especially their leadership would be willing to do so.”[/i]
I think the fairest thing for DCEA and for the City would be for the DCEA to request and for the City to grant a guarantee which did five things: [quote] 1. Retained the jobs of all 9 people being laid off for the remainder of this contract period;
2. Instituted all the terms of the labor contract on DCEA that the City imposed on May 25, 2010;
3. Erased the $804,000 judgment against the City;
4. Retained the jobs of all members of DCEA (including the laid off 9) for the duration of the following contract; and
5. Limited the cutbacks in total compensation to all members of DCEA in the following contract to no greater than the cutbacks in total compensation to all other non-safety bargaining groups in their next contracts. [/quote] If the City would agree to that compromise and make those guarantees, it would save the 9 jobs, it would have its services intact, and it would save $804,000.
If the DCEA would go along with that compromise, its members would all be employed, the terms of their employment would be no worse than the terms other non-safety groups now have, and at least through the end of the next labor deal they would not be facing more lay-offs.
If the DCEA would refuse the Can’t We All Get Along Plan, they would mostly be hurting their 9 members; and to some extent they put all ongoing members at risk in the next round of contracts, because the City might decide to lay off more members of DCEA and replace them with privately employed contracted labor (such as the City now does with half of its parks maintenance).
Mr Rifkin… based on what has happened so far, and given some of the personalities @ 23 Russell Boulevard, [b]if[/b] DCEA were to propose your 5 point plan, the City would agree to items 2 & 3, reject as infeasible items 1 & 4, and would counterpropose (for item 5) that the concept re: total comp would work, IF DCEA could “accept” that there would be another 5-9 layoffs, in addition.
We’ll see.
Sorry, my question/comment was so poorly presented that Rich and David kindly provided background that only half-answered my point. I understand that Harriet’s incorrect legal instructions ended up costing the city the $804,000 cited or, maybe, the much higher “full cost” totals that David’s calculating.
But. what I was meaning to question is the other half of Rich’s statement, that she’s “now (cost) 9 people their jobs.” Other than the coincidence of timing, what suggests a casual relationship between the layoff announcement and the need for coming up with $804,000? In fact, Pinkerton didn’t seem aware of the appeal decision until Vanguard comments revealed the fact.
Finally, doesn’t it seem odd that consideration of the potential costs of Harriet’s (and the rest of her firm’s) defective legal work was deliberately avoided as we evaluated whether to continue her association with the city?
It seems that this would have been a matter of public concern, at least discussion. And, here we are with recommendations that employees give up what illegally was taken from them by Harriet and the council–shouldn’t Harriet’s firms be contributing to this generous concept?
” In fact, Pinkerton didn’t seem aware of the appeal decision until Vanguard comments revealed the fact.”
I will address this point. When I talked to Mr. Pinkerton, I don’t remember which day that was, he indicated that they were expecting the decision by the end of the year. Nevertheless, he felt the need to deal with the problem at the beginning of the fiscal year. Second, everyone knew they were going to lose the appeal. It wasn’t a surprise to anyone at the city.
[quote]1. Retained the jobs of all 9 people being laid off for the remainder of this contract period;
2. Instituted all the terms of the labor contract on DCEA that the City imposed on May 25, 2010;
3. Erased the $804,000 judgment against the City;
4. Retained the jobs of all members of DCEA (including the laid off 9) for the duration of the following contract; and
5. Limited the cutbacks in total compensation to all members of DCEA in the following contract to no greater than the cutbacks in total compensation to all other non-safety bargaining groups in their next contracts.[/quote]
Love this idea, IF 1) BOTH SIDES WERE WILLING TO AGREE AND 2) IT WAS FISCALLY SOUND FOR THE CITY.
To Rich Rifkin: Inre blaming City Attorney for impasse mistake, I would not be willing to pass judgment (pardon the pun) unless I saw entire ordinance. Sometimes legal language can be subject to interpretation if read in context…
“…everyone knew they were going to lose the appeal. It wasn’t a surprise to anyone at the city.”
When you say “everyone knew,” do you really mean everyone or do you mean you? Or, do you mean everyone SHOULD have known? Do you mean Harriet…and the previous city manager…and every one of our city council members, the ones who approved moving ahead With the appeal?
Did these people publically announce that they knew the appeal was hopeless or just tell you behind the scenes? What possibly would be the motivation to proceed with with an expensive, lengthy appeal that couldn’t help but interfere with negotiations?
Did Pinkerton make the claim the we needed to fire the nine folks for the specific purpose of paying off he appeal judgment that he expected to come through six months from now?
I meant those in charge of policy in the city and making the plans and decision in city hall.
“Did these people publically announce that they knew the appeal was hopeless or just tell you behind the scenes? “
They didn’t publicly announce it, but it was not a guarded secret.
“What possibly would be the motivation to proceed with with an expensive, lengthy appeal that couldn’t help but interfere with negotiations?”
What makes you think it was expensive and lengthy? We are talking nearly a million dollars here.
“Did Pinkerton make the claim the we needed to fire the nine folks for the specific purpose of paying off he appeal judgment that he expected to come through six months from now? “
I would have to look at the precise wording but the answer is yes.
I suggest that folks with strong opinions read the following: http://www.perb.ca.gov/decisionbank/pdfs/2271M.pdf
Don’t know where Mr Rifkin says everything was due to Ms Steiner, or anyone else at HHA/BBK, based on the written record available fromPERB. Perhaps he has other documents he’d like to share, with the goals of disclosure/transparency. I’d like to see them, as the record doesn’t even mention Ms Steiner.
It DOES mention a number of City Employees, whose actions/inactions may have contributed (in may opinion, GREATLY)to what happened. Those employees may have acted with or without either the benefit of legal counsel, or chosen to ignore it. Based on the facts in the PERB record, it is unclear.
Once things go sideways, however, it is the City Attorney’s responsibility to defend the City from harm, much like a defense attorney is not responsible to get to the truth regarding what their client did/didn’t do, but to minimize the consequences to their client.
It’s only 45 pages, but in my opinion is well written and clear. I urge anyone who doubts MY doubts who was ‘responsible’ to read it themselves, come to their own conclusion, and discount what I, Mr Rifkin, Mr Harrington, Mr Thompson have to say in this matter.
[quote][b]”City Manager: City Reduces Staff to Stabilize Budget”[/b]
“Irrespective of the outcome at PERB, however, both the original concessions and additional cost savings were and are necessary, and these facts have been discussed extensively with DCEA at the table. Similarly, it was discussed that without negotiated solutions, some positions may need to be eliminated and employees laid off. Sadly, concessions with the DCEA unit were not achieved through negotiations to date, leaving the City only the option to lay off employees and restructure several departments to minimize the impacts of those cuts to the community.”[/quote]I can see how you could infer Pinkerton’s comment as tying the firings to his unspoken knowledge that the appeal would fail. I read it to say just the opposite, that we need the layoffs regardless of the appeal outcome.
I’m not sure that “everyone knew” the appeal would fail and that it was a “guarded secret” amongst the higher echelon of city government mean the same thing, but I understand your point now that you explain who “everyone” is for this purpose.
I call a year or so a “lengthy process”–you noted that Pinkerton was looking at the end of the year. And, I call pursuing a legal appeal as an “expensive process”–maybe Harriet handling this [i]pro bono[/i], though. And, there are other expenses involved in taking the time to go through the appeal process.
The main point I’m trying to make: If everyone knew the city would lose the appeal, then any amount of time and money we spend pursuing it is knowingly wasted. Plus, we have to pay an interest penalty on top of the original sin.
And, my question is: what, then, was the purpose? Why not accept the decision and reengage. Delay? Send a message to DCEA? Get past the election? There has to be some calculation that went into the decision to appeal when everyone knew that it was a lost cause.
[b]ELAINE: [/b][i]”I would not be willing to pass judgment (pardon the pun) unless I saw entire ordinance. Sometimes legal language can be subject to interpretation if read in context…”[/i]
I have a PDF copy of Ordinance 1303 (a.k.a. Resolution No. 1303). It is 12 pages long and also included is Resolution 1762 (3 more pages) which amends a part of Resolution 1303 not relevant to the PERB case.
The relevant part of Ordinance 1303 is Article XVII, which describes the Impasse Procedures. That Article is 3.5 pages long.
If you (or anyone else) would like me to send you a copy of my PDF, please send me an email, lxartist@yahoo.com, and I will attach a copy of the document.
[b]–Rich[/b]
[quote]I’m not sure that “everyone knew” the appeal would fail [/quote]In my opinion, any thinking/knowledgeable person, reading the 2011 ALJ opinion knew that no appeal was likely (even a 50-1 shot) to prevail. Read for yourself both the documents included in my citation. Smart money was for a judgement against the City from the day the action was filed… based on FACTS, not politics.
[quote]Do you mean Harriet…and the previous city manager…and every one of our city council members, the ones who approved moving ahead With the appeal? [/quote]There are only 5 people (or at least 3 of them) who can approve a defense of the City’s original action (or the taking of that action), or an an appeal of a ruling adverse to the City’s action. Those five have never included the names of Emlen, Chaney, Navazio, Pinkerton, nor Steiner.
[quote]”I’d like to see them, as the record doesn’t even mention Ms Steiner.”[/quote]You are incorrect. Thank you for this link. I’ve read the October 31, 2011, Unfair Practice Case Proposed Decision and the June 8, 2012, PERB Decision. Harriet’s report and incorrect legal advice to the city council (confirmed by council meeting minutes) are specifically noted in the material to which you directed us.
While Harriet did not represent the city at the hearings, her firm (Best, Best & Kreiger, by Stacy N. Sheston) did. As you suggest, hpierce, the two reports make it appear that those handling the negotiations day-to-day from the city’s side were seriously out-classed by the DCEA reps and that their performance bordered on incompetence.
Harriet’s direct role in the council’s illegal actions is undeniable and is documented in the findings.
Your suggestion that the city manager and other city employees might have been working with the DCEA negotiators unguided by the city’s legal counsel is possible, I guess. That could account for some of their missteps.
But, the council’s Resolution 10-070, which two years later now has to be rescinded, is fairly being blamed on Harriet’s own official legal finding offered up to the council.
[quote]Harriet’s report and incorrect legal advice to the city council (confirmed by council meeting minutes) are specifically noted in the material to which you directed us.
[/quote]Is there another link to the documents you refer to? I can’t find them at the PERB site.
I’m reading only from the two decisions to which you directed us: http://www.perb.ca.gov/decisionbank/pdfs/2271M.pdf
On pags18-19 of the October 31, 2011, report, the city talks about imposing LBFO, the DCEA responds that the action would put the city in violation of the city’s and Harriet gives the council her instructions about passing the illegal resolution.
It’s the only place where I saw Harriet listed by name. But is it logical that she’s not consulted when the city undertakes such an enterprise or that she’s not involved with the other lawyers from her firm when she calls them in to represent the city at these hearings and processes?
[quote]On pags18-19 of the October 31, 2011, report, the city talks about imposing LBFO, … [/quote]I stand corrected. I had missed those lines. That being said, remember my point is that they CA must ‘represent’ the City, even if she disagrees with the CM and however many CC people he has spoken to prior to the meeting, the CA is responsible to try and put into the record the ‘party position’, and attempt to ‘defend’ it. I have no idea whether that applies, or not, in this instance.