Retiree Medical and Bankruptcy: Why Davis Can and Should Cut Back on Its Overly Generous Retiree Medical Plan
In June, City Manager Steve Pinkerton’s pronouncement that the city’s retiree medical costs represent over 20% of payroll, and that number could go up as high as 25%, alarmed the Vanguard.
“Unfortunately, 20% of payroll is probably not going to cut it in the future,” City Manager Pinkerton told the city council back in June. “We’ve been ramping this up, the council has been responsible and doing the right thing for the last three or four years by beginning to take on retiree medical, ramping it up each year from 6% to 8% to 10%, last year it was 12% of payroll, the original plan was to go 14%…”
There have been some interesting new developments this week with regard to water. On Thursday of next week, the Water Advisory Committee (WAC) will meet in a crucial meeting that may determine at least the WAC’s recommendation for the water project.
It appears we may be heading toward a decision on water – at least from the standpoint of the Water Advisory Committee (WAC). The committee voted to eliminate the three most expensive options.
On Thursday night, the Water Advisory Committee (WAC) narrowed down the project options from six to three. The pattern was very clear and unequivocal. The WAC eliminated the three most expensive project options and kept on the table the three least expensive project.
On Tuesday, the city council brought back for discussion the city’s Urban Forest Management Program, to discuss how tree services would be maintained in the face of cutbacks and a transition to more heavily utilize the West Coast Arborist services, which has a contract with the city on a per tree basis.
One of the biggest weaknesses of the Joint Powers Authority has been that the two members serving on it were actually not representative of where the council majority was on the water issue. Stephen Souza and Joe Krovoza were the two strongest supporters and proponents of the water project, at least at the time of the September 6 water rates.
On September 6, 2011 the Davis City Council in the wee hours of the morning, by a 4-1 vote, voted to move forward with the surface water project with what they called a 14 percent rate hike.
The news this week that the city of San Bernardino declared bankruptcy ought to have a stunning impact on the rest of the state. The basic problem that San Bernardino faces, as one analyst suggested, is that they ignored their economic hole for the last fifteen years and it ultimately resulted in municipal insolvency.
The June 30 deadline for the expiration of bargaining unit contracts has come and gone. The budget has been passed, but a discussion of cuts to some positions re-opens next week. The new council will be seated this week.
William McDonough is best known it seems for designing the Ford Motor Company’s plant with a vast green grass roof. But in the last ten years, with his book “Cradle to Cradle,” he has, according to Forbes Magazine, “unleashed a design revolution that began examining not just what things look like, but also the chemical makeup of things: water bottles, carpet, countertops.”