March 8, 2012
Mattos, Editor and Publisher
Leroy Pyle, Webmaster
The Farsider is an independent publication that is not
affiliated with the San Jose Police Benevolent
Assn. The SJPBA has allowed the Farsider to be included on its web site solely
for the convenience
of the retired San Jose Police community. The content of this newsletter does
not represent or reflect
the views of the San Jose Police Benevolent Association's Board of Directors or
RETIRED SERGEANT W.J. "JAY" MARTIN
I.D. card photo
Born May 19, 1932
Appointed Nov. 1, 1966
Promoted to Sgt. Oct. 1, 1978
Retired June 3, 1987
Died Feb. 28, 2012
According to Jay's son,
retired Ofcr. Brad Martin, his father and mother were "snow birds" who spent
winters in Yuma to escape the cold climate of Powell Butte, Oregon (near Bend).
When Jay developed a bad fever and saw a doctor, stage 4 Lymphoma cancer
centralized in the liver was discovered, and he was transferred from a Yuma
hospital to a hospital in Phoenix for treatment. He passed away on Feb. 28th at
the age of 79.
A memorial service is scheduled for March 31st at the Church of Christ, 925 NW
7th St., Redmond, OR 97756.
Brad OK'd the publishing of his cell phone number should anyone have any
Following is an obituary that had been prepared for the Mercury News. We
received it from Brad last Sunday:
~ ~ ~
W.J. Tilmon "Jay" Martin passed away unexpectedly on Feb. 28, 2012 in
Phoenix, Arizona at the age of 79. He was born to Shavor and Lona Martin in the
small town of Orange in Orange, CA on May 19, 1932.
Jay joined the U.S. Air Force in 1951 and served two years of his 4-year tour of
duty as a sheet metal technician repairing aircraft during the Korean War. He
received his honorable discharge from the Air Force in 1955. Two years later he
and Marilyn Jean Davis were married and settled down to raise a family.
In 1966, Jay joined the San Jose Police Department where he served for 21 years
before retiring as a Sergeant in 1987. He was considered a problem solver and
highly respected by his peers during his police career. Following retirement,
Jay and Marilyn moved from San Jose to Grants Pass, OR where the couple raised
Tennessee Walkers as show horses. They later moved to Bend, OR so they could be
closer to their children and grandchildren.
Jay loved riding horses and spending time in the mountains where he enjoyed the
peaceful solitude they provided. He also loved hunting deer and elk from
horseback with his friends.
The couple escaped the cold Oregon winters by spending time in Yuma, AZ where
they soon became friends with other "snowbirds" as well as members of the Church
of Christ, where they regularly attended services, and where Jay would become a
church elder in the Church of Christ in both Grants Pass and Redmond, OR. Jay's
faith in God was one of his strongest character traits.
Jay is survived by Marilyn, his wife of 57 years; a son, Brad Martin of Bend,
OR, and two daughters: Shelly Dietsch, also of Bend, and Leslie Martin of San
Jose. He also is survived by five grandchildren and three siblings: Dariel "Dee"
Martin of Culpeper, VA, Merle Martin of Paradise, CA, and Beverly Horton of San
Diego. Hay was preceded in death by his youngest daughter, Kristi Martin.
A memorial service is scheduled for Saturday, March 31, at 2:00 p.m. at the
Church of Christ in Redmond, Oregon.
mid-1970s) Jim Silvers; Stan Horton, Jim Cornelius, Jay Martin, Lloyd
Meister and Lyle Rice. (Stan, Jay, Jim Cornelius and Lloyd are
Jim Silvers, who worked
with Jay back in the '70s and learned from Brad about his father's passing last
Friday, wrote and asked if I could find and e-mail him the photo above that he
provided when I covered the death of Jim Cornelius. The Archives pointed me to
the May 22, 2008 Farsider that included the photo in question. After I e-mailed
it to Jim he replied with the following...
Thank you for the picture. I talked to Brad and got a forwarding e-mail address
for the photo. The picture had been requested by Stan, and it hung in his office
even after he had been promoted to Asst. Chief. Brad said he had just signed up
for the "rag sheet" (Farsider) — my words, not his — so I think the family
would appreciate comments.
I worked with J.W. in the Fencing Unit, which preceded the Burglary Prevention
Unit (BPU) where I also worked. J.W. and Lyle Rice worked together as did Corny
and I. Lloyd Meister was the Admin. Sgt. and, of course, Stan Horton was the
Boss (he was a Lt. at the time).
The concept of a fencing unit originated with the Portland (Oregon) PD. We were
the second police agency in the nation to implement one, and we had some really
good times. I remember J.W as the calm, level-headed one. When things went
south, he could be relied upon to figure out what to do. And with our gang,
things went south a lot.
As usual, when a friend passes it's not uncommon to ask ourselves, "Why didn't I
stay in touch?" That is especially true in J.W.'s case. As Chaplain Bridgen
would say, "It's something to think about."
• • • • •
Born June 26, 1942
Appointed Nov. 16, 1967
Retired March 11, 1995
Died Feb. 20, 2012
The following obituary is
from the March 5th Mercury News...
Richard S. Weiser — Resident of
Richard Weiser (a native to San Jose, CA and longtime resident of Aptos, CA)
died at home in the company of family on Monday, February 20, 2012. Richard was
a loving and devoted father, husband, friend and civil servant having proudly
served both in the U.S Army and providing the San Jose Police Department 28
years of committed service. His generous nature and kind heart made a lasting
impression on everyone who knew him. As a family man, he was a dedicated father
to his two daughters, Charmain Weiser and Shereen (Weiser) Caswell. He was also
a loving and devoted husband to Michelle (Engdol) Weiser whom he unfortunately
lost to cancer in 2008.
Richard would most like to be remembered and honored for his years of service to
the military, the San Jose Police Department and the community. In lieu of
flowers please send donations in his name to Disabled American Veterans.
A private service will be held at a later date.
Friends can sign and/or view Rich's guest book by
clicking on this link:
Darrel Richter was one of
several retirees who became aware of Rich's passing earlier this week. He sent
in the following:
Rich and I were long time friends at the PD and enjoyed living our lives in
Santa Cruz County. We hunted deer together all over Northern California, were
49'er season ticket holders, etc.
He was a great guy and a particularly private family man whose wish was to
remain so, thus a small private memorial to honor him will be held.
Thank you for all you and Leroy do for us! It is sincerely appreciated.
Darrel Richter, Lincoln, CA
FOR AT LEAST SOME RETIREES GOING UP
Make sure you read my footnote at the very bottom of this item...
This touches on the subject
of healthcare costs for retirees. That the cost of medical coverage for retirees
under the age of 65 will be increasing appears to be a slam dunk. The question
of whether those retirees over the age of 65 who are covered by Medicare will
have to pay more isn't yet clear. We should be able to answer that question next
Last Sunday, March 4th, the POA sent a Membership Alert to all members
describing its proposal to the City with the hope that it will be adopted by the
Council in lieu of the City's proposal. Of special interest is the portion of
that Alert that speaks to healthcare costs for active and retired personnel.
(It's included below.)
Craig Shuey has been closely following everything related to the pension reform
issue. After reading the lengthy March 4th Membership Alert, he had some
questions about healthcare for retirees, so he sent POA President Jim Unland and
VP John Robb the following message...
Jim and John,
While you both are going 100 MPH in negotiations, I reluctantly ask you to
clarify a point you made about retirement medical costs In the Membership Alert
you sent out yesterday. You wrote:
"Our proposal would still offer retirees a free healthcare plan, but it would
come with a high deductible. In order to keep the Kaiser plan they have now,
they would pay the same 15% that active members are paying."
1. When you say "retiree," do you mean current retirees, future retirees, or all
of the above?
2. You indicate that your "proposal would still offer retirees a free health
care plan...but...with a high deductible." However, you go on to say that "they"
(I think you mean retirees) would "pay the same 15% that active members are
paying," thus implying that the medical will not be free. My simple mind sees
this as contradictory. Will retirees still have free health care but with higher
deductibles, or start to pay 15% of the premium that members pay? Or worse yet,
all of the above?
Thanks for your tireless hard work.
Craig Shuey #1459 (Ret.)
Jim Unland's answer was
included in this e-mail we received from Craig...
Here is the response I received from Jim Unland. It doesn't go unnoticed that he
has alligators nipping at his ass, but I still don't understand how a "free"
healthcare plan will cost us 15%.
This will affect “all of the above." The high deductible plan would be the
“free” plan. If a retiree wanted to keep the Kaiser plan they have now, they
would have to pay the 15% that the e-mail talked about.
* See my editor's footnote at the bottom of this
(partial) Membership Alert..
March 4, 2012
(I have reprinted only
that portion of this March 4th POA Membership Alert that pertains to healthcare
for active and retired personnel...)
Another area of change is in our retiree healthcare.
Currently, active members pay 15% of the low-cost healthcare plan (Kaiser). For
individuals, this amounts to $956.64 per year (79.72/month). For the family
plan, this amount is $2,382.48 per year (198.54/month). Under our current plan,
when you retire this 15% fee goes away. That is to say that retirees get Kaiser
for free, but pay some money if they want one of the Blue Shield plans.
Our proposal would still offer retirees a free healthcare plan, but it would
come with a high deductible. In order to keep the Kaiser plan they have now,
they would pay the same 15% that active members are paying.
The City has been looking for a way to increase the costs to retirees by 25%.
While this news will not be welcomed to our retirees, our active members are
bleeding money. We felt that having retirees pay the same as actives beats the
That is probably the best way to sum up this email. No one wants to see our
benefits reduced or our costs to go up. This proposal is an effort to find
modest (a relative term) changes to our benefits package that still keeps all of
us whole. Considering the alternative, it's not bad.
Ed. — After I prepared this article on Tuesday of
this week based on info provided by Craig Shuey, the question of how retirees
who are over the age of 65 and are therefore covered by Medicare will be
impacted, so I sent an e-mail to POA President Jim Unland and asked that very
question. Within a couple of hours I received the following reply:
Great question. Let me see if I can get a clear and accurate answer for you over
the next couple days.
As of press time there has been no reply. Logically,
it makes no sense that retirees covered by Medicare will incur the same cost as
retirees who don't have the coverage. Whatever the case, we'll have to wait for
an official answer, which we should have by the time we go press next week.
If you act quick, you still have time to send the
D.A.'s Office a letter expressing your opposition to Emile Thompson being
paroled. Letters must be received prior to next Wednesday, March 14th, as
Richard's killer goes before the Parole Board on April 4th.
Send them to:
Santa Clara County District
DA Ron Rico/Maria Serrano
Hedding, West Wing
San Jose, CA
Thompson, CDC # B38349
Unfortunately, we have had to cancel the Cioppino Feed scheduled for this coming
Saturday that was to benefit the Chaplaincy as we are nowhere near the number of
ticket sales needed to make it possible.
We are going looking forward to this year's Golf Tournament and hoping for a
better turnout. Please save the date for the San Jose Chaplaincy Golf Tournament
on Oct. 8th at Eagle Ridge. More info to follow.
Juan M. Reyes
CANCELLATION LEAVES TWO MORE FEEDS FOR SEAFOOD LOVERS
This Kiwanis Crab Feed is scheduled for Friday, March 23rd...
And this MMOC Cioppino Feed to be held on Saturday, March 31st...
Results from last week's poll...
For the full scope of state and national polling by Scott
Rasmussen, click on this link:
For the most recent releases, click here:
Our wonderful Mayor was on a local Sacramento talk show this week speaking about
our pension plan. He was able to get the two DJ's all fired up by alluding that
we have a "free" lifetime medical plan. He also called any labor union challenge
to his ballot initiative a "bogus" legal challenge. When asked what idiots were
responsible for giving us such ridiculous benefits, he pulled out the Obama
playbook and blamed prior City officials. He apparently forgot that he was one
of those "idiots" who voted in favor of our 3% COLA. No doubt this man has
bigger political goals and will do all he can to achieve them off the backs of
the labor unions.
Reed may have felt he was a
sufficient distance from Bay Area radio and TV stations that he felt free
to spin the facts to fit his agenda. If the lame duck mayor does have further
political aspirations, the odds seem good that the $650 million hyperbolic
pension cost projection will come back and bite him in the ass.
• • • • •
We recently moved so I attempted to do opt outs for Zaba Search and Spokeo. In
the process, I found that previous opt outs were not acted on, and they are no
longer honoring opt outs of any kind absent a court order. When I checked, I
found both sites had every address I have lived at since the early '80s, as well
as names of other relatives, etc. This appears to be a losing game. Thought you
might want to check with your readers to see if the opt outs they thought they
had are still in place.
Hi Bob: A Google search for
"how to opt out of zabasearch com" will yield several links to a solution that
should work for you and other concerned readers. Likewise with Spokeo. Just
search for "how to opt out of spokeo." (Readers who have already opted out of
either or both websites might want to drop Bob and e-mail.)
• • • • •
I hope you are well. I retired in January after more than 27 years and am now
busy managing elder parents and in-laws. Not quite what I expected to be doing,
but I am grateful that I have the time.
I would like to join the Farsider subscription list, and I hope that over the
next 6 months I will able to join the PBA and attend a meeting. I look forward
to catching up with those who went before me and keep in contact with the
organization as a whole.
What information do you need/want? The basics are listed below.
You provided all the info
we need, Jenn. Leroy and I each maintain identical Farsider rosters and you have
been added to both. By now, you should have received the notification that Leroy
sends out each week advising of a new Farsider after we get it posted to the PBA
website. Welcome to our growing family. You are the 812th subscriber.
• • • • •
Gary Leonard sent in a link
on March 3rd to an obituary published in the Sacramento Bee along with the
I worked many cases with Phil Morris while at SJPD. He was a very good detective
and a good friend.
Philip L. Morris
Beloved husband, father & grandfather Phil Morris passed away on February 25,
2012 in Chico, CA, at the age of 76. Phil was born in Ohio and graduated from
Fremont High School in California. Phil worked as a deputy sheriff and detective
in Santa Clara County before moving to Sacramento to work for the Department of
Justice as a special agent. After retiring from the State, Phil worked as a
private investigator. He enjoyed his 35-year career in law enforcement.
But what brought Phil even more joy were his family and friends. Phil was one of
the true good guys. He had heart of gold and was always willing to help others.
He had a great sense of humor, an infectious laugh and was quick with a smile
and a wink. He will be dearly missed. He is survived by his wife, Bonnie of
Chico; his son Chris of Austin, Texas; his daughter Kim and her husband Jeff
DuFour of Chico; his daughter Cathy and her husband Errin Norlie of Chico; and
his 3 adored grandchildren Kristen, Jenny and Zach.
An open house celebration of his life will be held at the home of Kim and Jeff
in Chico, on Saturday, March 24 from 1:00 to 4:00 pm. In lieu of flowers, the
family requests that you make a donation to a charity of your choice.
• • • • •
FYI, the SJPD Badge #259 listed on eBay did not sell.
It had 11 bidders, however, they all failed to meet the reserve price. I'm sure
it will come up again one day.
This is a
screen capture (photo image) that made up the rest of Jack's message...
• • • • •
Bill & Leroy,
I don’t know if you remember me, but I was with San Jose PD, Badge #1860, from
January 1977 – March 2003, when I accepted a job as a Special Agent with the
FBI. I stayed with the FBI until December 2010, when I retired. I am currently
working as a Police Officer with the Anchorage Police Department. I happened to
run into Glenn Kaminsky today while he was teaching a group of new Anchorage PD
I would like to be added to the Farsider list. Here is my contact information:
We never forget a name, Kevin. Sometimes a face,
but never a name. As the 813th subscriber, welcome to the Farsider Family. If
Glenn is still there and you run across him again, give him our regards. If you
don't see him, he will probably see this since he is one of our longtime
subscribers. (Hi Glenn!)
VIDEOS ON THE PENSION REFORM ISSUE
—See the "Local News for Out-of-Towners" column below for
March 1st — Lawsuit for Breach of Fiduciary Duty
March 2nd — Police & Fire Offers Pension Reform that Guarantees
March 5th — Legislators Pursue State Audit of Chuck Reed
LOCAL NEWS FOR YOU
In chronological order,
here are the pension reform articles, editorials and letters to the editor that
were published in the Mercury News since we went to press last Thursday morning.
The final two articles and single editorial from yesterday and today's paper
tell the tale, so you might want to consider scrolling way down to the bottom of
this column if you're looking for the meat...
It’s Time to Put Pension Reform
on June Ballot
Mercury News — March 2, 2012
Time has run out, and so, apparently, has the
inclination for civil debate. Tuesday is the last chance for the San Jose City
Council to place a reform measure on the June 6 ballot, so it needs to approve a
final version of its ever-evolving pension reform proposal.
Until a few weeks ago, we clung to the Pollyanna hope that San Jose and at least
some of its unions — particularly police and fire — could reach agreement on
pension reform and avoid a bitter fight over the ballot measure. But time has
While San Jose’s financial outlook is improving, it does not change the fact
that the city’s two pension funds, laden with unfunded liabilities, are not
sustainable at current benefit and cost-sharing levels. Reductions in long-term
liability in the actuaries’ most recent projection are a result of pay cuts and
reductions in staffing, including about 200 fewer police officers and
firefighters. This has dramatically reduced levels of service; it’s no answer
for employees or for residents. We can’t cut our way out of the pension trap.
The proposed measure today is magnitudes better than the overreaching
first-draft put forward by Mayor Chuck Reed in May. In fact, it’s close to an
alternative suggested by Councilman Don Rocha but dismissed at the time by the
council majority as too timid.
The measure resets fixed pension benefits at a fair level — still greater than
the private sector offers, but that’s necessary to keep San Jose competitive
with other cities in recruiting talented workers. If benefits elsewhere remain
higher, San Jose will have to increase salaries to compete.
That way, taxpayers will be paying for the services they’re receiving. Padding
pensions pushes the burden onto future generations.
The city bears some of the responsibility for failing to reach agreement with
the unions; Reed has hardly set a conciliatory tone. But last month, union
leaders and their lobbyists trashed any remaining possibility of civil debate.
And we do mean trashed. They trumped up controversy over a worst-case pension
estimate used by Reed last year, fired off ethics and other drama-laden
complaints purely for the publicity value and falsely asserted that the
years-away estimate had influenced unions’ concessions to save jobs in the
What a crock.
The unions think they can reverse some of the ballot measure reforms in court.
Maybe they can, although the current proposal looks more defensible than earlier
The city should plan now to expedite the resolution of inevitable court
This week, council members agreed to put off consideration of a tax or bond
measure until after the June election. That was smart. Residents are not happy
with closed libraries, fewer police patrols and crumbling city streets — but
they know pension costs have tripled over the past decade from $73 million to
$245 million out of the general fund that pays for police officers and
librarians. Voters need to know that pensions are under control before they’ll
agree to pay more to City Hall.
If pension reform paves the way for a revenue measure, and the economy continues
to improve, San Jose will be able to rebuild its workforce and restore services
without digging itself into another deficit hole. That should be everyone’s
The current proposal is magnitudes better than the overreaching first draft put
forward by the mayor in May. And time has run out for union negotiations.
• • • • •
This story made the front
page of last Saturday's paper. It's as close to "good news" in terms of the
City's budget woes as has been seen in some time...
Glimmer of Hope in S.J.’s
forecast for next fiscal year, but leaders warn that not all is rosy—
By Tracy Seipel
Mercury News — March 3, 2012
After enduring a decade of budget deficits, San Jose
finally expects a reprieve next fiscal year: no budget shortfall, and perhaps
even a modest $10 million surplus.
Still, no one is breaking out the Champagne, because deficits are predicted for
the two years that follow.
“We’ve been falling into a deep hole for a long time — and even if it looks like
we might have finally hit bottom, we still have a long way to climb out of it,”
said City Manager Debra Figone on Friday after releasing her five-year forecast.
Only a few months ago the city had expected its 11th consecutive budget deficit
for the year starting July 1 — with at least a $25 million shortfall. But a few
key factors have turned that around. Property and sales tax revenues are
increasing, and key employee benefits will cost less than projected, including
retiree health care, employee sick leave and workers’ compensation.
The latest figures could complicate Mayor Chuck Reed’s efforts to maintain
momentum for a pension reform ballot measure that the council is expected to
finalize Tuesday. On Friday, Reed contended that the seemingly good news does
not mean those reforms are no longer needed.
“It’s good news that next year is up, but we’re not really out of the woods
yet,” he said, citing pension costs that will continue to escalate and ravage
the city’s budget unless they are contained through fiscal reforms and a June 5
pension reform ballot measure that would shrink retirement costs.
In fact, Figone forecasts a $22.5 million budget deficit in 2013-14, propelled
by a $29.5 million increase in retirement expenses. However, the last two years
of her forecast show notable surpluses, though they could be altered by a
variety of reasons.
Reed said estimates suggest that employee pension costs will grow for an
additional 12 to 13 years, until 2025, and “everybody should be worried about”
that cost. But if the ballot measure passes, city staff members said at a Feb.
13 council study session, the city could initially save $48 million, plus
additional savings from new employees being placed in a lower-cost retirement
plan. Figone’s five-year budget projection does not take into account the
pension reform measure or other factors.
That kind of savings, the mayor said, could help pay for the city’s $100 million
annual road maintenance cost as well as increase the city’s contribution to its
retirees’ health care.
“Other than that, things are wonderful,” quipped Reed, who said he expects few
if any layoffs next year and hopes the 2012-13 budget can help restore some
City officials said pension costs are estimated to grow only slightly, from
$245.5 million this fiscal year to $245.8million in 2012-13. But that’s
primarily due to hundreds of workers being laid off last year and employee
salaries being slashed by 10 percent.
For the same reason, said Employee Relations Director Alex Gurza, an estimated
$400 million in retirement costs for 2015-16 now have been reduced to closer to
But Reed and other city officials say layoffs and pay cuts are no way to solve
the city’s budget problems.
“We reduced our payroll last year by 24 percent,” Reed said. “We don’t want to
do that again.”
“We want to build capacity and meet the city’s basic service needs — and be a
good employer,” Budget Director Jennifer Maguire said.
With a one-year budget respite, Figone and Maguire say now is the time to
stabilize the city’s costs and focus on San Jose’s fiscal reform plan, which
they contend will save money and allow the city to add back employees and
City officials said at the Feb. 13 study session that modifying the lowest-cost
medical plan for employees and retirees would save the city $14 million
annually. Eliminating sick leave cash outs, where employees save their sick days
over the years and then receive that accrued pay when they leave their city job,
would save about $7 million annually, he said.
San Jose officials, who have been accused by unions of inflating estimated
retirement costs, emphasized that the numbers released Friday comprise only a
forecast. Employee unions have called the city’s pension reform measure illegal.
In advance of Tuesday’s meeting, five unions representing the city’s police
officers, f irefighters and engineers and architects, among others, submitted on
Friday a new set of pension cuts that they say will guarantee savings and avoid
“a long, drawn-out legal battle.”
“We are elated that the budget picture is improving, but that does not negate
the need for legal pension reform,” said Tom Saggau, a union strategist.
• • • • •
The article above was
followed by this update on page 6B of the local section of the same (Sat.)
San Jose Unions Make Last-ditch
revised concessions to head off ballot measure—
By John Woolfolk
Mercury News — March 3, 2012
Five unions representing San Jose police, firefighters
and other workers offered new pension cuts late Friday just days before city
leaders are set to vote on finalizing a ballot measure that would reduce the
costly perk. In their revised offer, the unions say they would accept additional
pay cuts to guarantee cost savings to the city if not enough volunteer for a
reduced pension plan. They also offered reductions in a costly retirement health
plan benefit and several other changes sought by the city.
“Today police officers and firefighters again responded to the call for legal
pension reform,” said Robert Sapien, president of the San Jose Firefighters
union. “Our proposal will ensure that the City will be able to count on savings,
protects the taxpayers we serve and provides our members with a fair retirement
The new concessions came as City Manager Debra Figone revised budget projections
showing the city faces its first budget surplus in a decade this year, largely
due to recent layoffs, pay cuts and higher tax receipts. Deficits are expected
in later years as pension costs rise.
City unions have offered increasingly generous pension cuts and city leaders
have softened the proposed ballot measure over months of talks. But key sticking
points remain, including the unions’ assertion that the city cannot legally
force its workers to pay more for their pensions if they don’t switch to a
The latest union offers got a chilly reception from Mayor Chuck Reed and other
top city officials. Reed and four other council members Friday issued a
memorandum urging the City Council to proceed with his proposal for a pension
reform measure on the June ballot, arguing only voters can adopt many of the
A narrow council majority approved ballot language in December, but Reed wants
to replace it Tuesday with milder terms to reflect employee concerns raised in
mediation. The deadline for June ballot language is March 9.
“A negotiated solution alone will not solve our longterm pension problems,”Reed
said in the memorandum also signed by Vice Mayor Madison Nguyen and council
members Sam Liccardo, Pete Constant and Rose Herrera. “We must go to the voters
to achieve lasting change and gain control of pension costs that have already
cost services and city jobs.”
The unions however said they want the city to take their offer to voters instead
of the proposed ballot measure.
• • • • •
Last Sunday the Mercury
News tried to explain to its readers what the pension reform issue is about and
what the measure would do if it appears on the June ballot and is passed...
Making Sense of San Jose’s
Tuesday’s vote, we examine conflicting views of mayor, unions—
By John Woolfolk
Mercury News — March 4, 2012
On Tuesday, San Jose City Council members will decide
whether to modify a June pension reform ballot measure that Mayor Chuck Reed
says will ease the growing costs of employee retirement.
To pay those costs, San Jose has cut staffing and the services that go with it.
The modifications address some employee concerns.
City employee unions still say the measure would violate their legal rights and
have accused Reed and other top city officials of exaggerating the severity of
What’s all the fuss about and how are voters supposed to sort out the
conflicting perspectives? Here’s a pension primer to help make sense of it all.
Question: How do pensions work?
Answer: Pensions are employer-provided benefits that pay a regular monthly sum
in retirement, typically a percentage of salary for every year worked. While
they remain a standard government perk, private employers have been replacing
pensions with 401(k) savings plans in which the employer may contribute toward
the employee’s retirement but doesn’t promise a fixed benefit.
Question: How are those costs estimated?
Answer: Trustees who oversee pension funds hire actuaries who recommend how much
the employer and workers must set aside out of each paycheck to cover the future
cost of the lifetime retirement benefit. The trustees regularly review those
contributions to determine whether their assumptions match actual experience.
Question: So what’s the problem?
Answer: San Jose and many other government employers have been underestimating
pension costs and overestimating investment returns. Since the 1990s they have
boosted benefits while putting less money into the pension funds than will be
needed to cover employee retirement costs. A September 2010 San Jose audit found
total pension benefit payments had grown sevenfold over 20 years and exceeded
contributions to the retirement funds for a decade. It said the city’s $4
billion pension plans were short some $2 billion needed to cover future
benefits. Since then, pension trustees have adopted more conservative
assumptions and sharply increased how much the city is paying toward the pension
Question: Employee unions say the mayor and city overstated the pension problem
and hyped a bogus assertion that pension costs could hit $650 million in a few
years. Is it possible the pension problem isn’t so bad?
Answer: Estimates of future costs guide trustees in overseeing pension funds and
help city leaders plan for cost increases in their budget. But those projections
can vary greatly depending on the assumptions used to make them, which change
over time. The city projected last year that annual costs to the city budget
could reach $400 million; now it expects a total closer to $300 million.
Actuaries largely attributed the reduction to the recent layoffs, higher
investment returns and 10 percent pay cuts. But while projected future costs
have dropped some, the city still faces a growing retirement bill that already
has risen from $73 million a decade ago to $245 million this year. Unions argue
the higher costs are being driven by assumptions they consider overly
Question: That’s bad, but not $650 million bad. So why did the city cite the
higher figure if it appears unrealistic?
Answer: The figure was an estimate the city retirement director offered at a
public meeting a year ago when asked how much higher city pension costs could
rise above official projections under more conservative assumptions. Though he’s
since backed away from that estimate, others who studied the city’s retirement
system last year made similar gloomy forecasts. Unions said the city should have
acknowledged months earlier that layoffs and pay cuts would shrink the future
cost projections, but also acknowledge that higher projections are possible
under more conservative assumptions.
Question: Still, if San Jose’s future pension bill is now expected to be lower
than either the gloomy $650 million figure or the $400 million official
projection, doesn’t that show the problem’s not as big as once thought?
Answer: Effectively, San Jose has brought down its future pension bill by
shrinking its workforce. The city has shed more than 2,000 jobs in the past
decade — more than 1,200 of those just in the past two years, leaving a work
force of 5,400. San Jose now has almost 200 fewer police officers and
firefighters than it did two years ago. The city currently supports more
retirees and their survivors through its pension system than it has employees
paying into it. And while the city has cut employee pay 10 percent, employee
costs overall have grown as the city pays higher rates for pensions. In the past
couple years, the percentage of payroll San Jose pays for retirement has more
than doubled for officers and firefighters and grown by a third for other
workers. The work force likely will continue to shrink unless pension costs grow
more slowly or the city gains more revenue.
Question: Isn’t the pension problem mostly driven by the 2008 market crash, and
won’t it ease as the economy recovers?
Answer: The market crash worsened what already was a problem. The city was
paying out more in benefits than it put into the pension funds for many years
before markets took a dive late in 2008. San Jose’s pension funds, like many
others, lost about a quarter of their value in the 2008 market crash. Because
the funds had assumed annual returns of 8 percent or more, the city has to make
up the roughly $1 billion in market losses over time.
Question: How did things get so out of whack, and who can we scream at for
Answer: Many had a hand in the city’s pension failure. State leaders approved
more generous retirement packages for state workers in the late 1990s, prompting
local employee unions to demand similar increases. San Jose police and
firefighters enjoy voter-approved arbitration rights that weakened the city’s
ability to rebuff compensation demands. The pension system until recently was
overseen by city leaders, employees and retiree trustees with clear conflicts of
interest and little background in financial management.
Question: What would the mayor’s pension reform ballot measure do?
A Employees hired in the future would have a less costly retirement plan, which
could combine a 401(k)-type plan and Social Security with a smaller pension that
would have higher retirement ages and lower cost-of-living increases. The city
also would increase current workers’ contributions toward their pensions unless
they switch to a cheaper plan for their remaining years on the job. It also
would make changes to disability retirement and allow the city to suspend
cost-of- living raises for current retirees if the city declares a fiscal
Question: Why didn’t the city negotiate pension changes with employees instead
of going to the ballot?
Answer: San Jose officials spent months negotiating with employee unions on
pension changes, and both sides moved closer together during the process. City
leaders have softened the ballot measure in response to union criticism. They
reduced the additional amounts current workers would have to pay toward their
pensions if they don’t sign up for a cheaper plan, made the retirement plan for
new hires a bit more generous and backed away from cost-of-living cuts to
retirees. Unions have made substantial concession offers. Police and
firefighters, for example, offered that new workers could have the same pension
plan the city had offered in the early 1990s before a series of enhancements.
But key sticking points remain, including the ability of the city to require
current workers to pay up to twice as much toward their pensions.
Question: Are there alternatives?
Answer: The mayor has cited Vallejo’s 2008 bankruptcy as a grim alternative to
his pension reforms, though it’s unclear how realistic that is. Stockton is
flirting with a bankruptcy filing in part because of pension costs. San Jose
could seek further pay cuts from employees, but with their salaries already
slashed 10 percent that may be unrealistic. The city could raise taxes, and the
mayor and City Council are exploring several possible revenue measures to put
before voters later this year. But that may not be enough to solve the problem.
The quarter-cent sales tax that preliminary polling suggests is most likely to
win voter approval would raise $35 million a year, while the annual retirement
bill is expected to rise at least $50 million in coming years. The city could
sell pension obligation bonds, but critics liken the practice to paying a
mortgage with a credit card and say it will saddle tomorrow’s residents with the
costs of today’s workforce. The city could outsource more work, as it has
already done with janitorial work, graffiti abatement and some park maintenance.
The city also could muddle along indefinitely with a smaller staff and fewer
• • • • •
Don't read this column that was also in last
Sunday's Mercury News if you are easily pissed. It was authored by Daniel
Borenstein, a columnist and editorial writer for the Contra Costa Times, which
is owned by the Bay Area News Group that also owns the Mercury News. It doesn't
take a dyed-in-the-wool conspiracy theorist to suspect that the Merc brought in
this "big gun" to help convince the paper's readers that San Jose's public
employees are the bad guys and gals in this drama about pension reform. But to
be fair, he's also tough on California's public employees as you will see if you
click on this link:
Pensions a Likely Train
Wreck for S.J.
Contra Costa Times columnist and editorial writer
Recent San Jose actuarial reports show $3.5 billion of city debt for
underfunded pension and retiree health benefits — a shortfall that works out to
about $11,000 for every household in the city.
Yet, as Mayor Chuck Reed proposes substantive pension reform, workers and a
local television reporter are hyperventilating about irrelevant numbers that
distract from the ballooning debt. If not for major layoffs and salary cuts last
year, the shortfall would be much worse. It would also be much larger if the
city used more realistic investment earnings assumptions rather than relying on
overly optimistic forecasts.
Nevertheless, the calculations show the city’s retirement programs combined have
only 56 percent of the funds they should. Put another way, the unfunded
liability equals about eight years of city payroll.
To understand what’s going on here, keep in mind that employees earn additional
future retirement benefits for each year that they work along with their
salaries. So the city and its workers should invest enough money annually to
cover the future costs of those newly earned benefits.
The city has three problems: First, the amount that should be set aside for
those newly earned benefits has increased. Second, even that greater amount
isn’t enough because the payment calculation relies on those optimistic
investment assumptions. Third, past reliance on unrealistic assumptions,
retroactive benefit increases and actuarial changes have caught up with the
city, leaving it with huge unfunded liabilities for pensions. As for retiree
health benefits, only small amounts have been set aside for future benefits.
The resulting debts are treated like mortgages, with annual payments spread over
as much as 30 years, thereby passing costs to the next generation. The city must
pay off the entire pension shortfall; workers have no obligation.
For retiree health, workers make a small contribution toward the debt.
The benefits driving this are:
• Retiree health care. The city provides free lifetime insurance to workers who
retire from San Jose after 15 or more years of service. Spouses and dependents
are also covered. The plans are only 9 percent funded with a $1.9 billion
• Pensions. The plans are 74 percent funded with a $1.6 billion shortfall.
Pension benefits are based on age at retirement, top annual salary and years on
the job. Retired firefighters and police who worked 26 to 30 years are
collecting an average $92,900 a year.
Retirees from other departments with the same experience average $60,432 a year.
While city workers contribute to the pension and retiree health care plans
through payroll deductions of about 12 to 19 percent of their salaries, a much
larger burden falls on the city.
For police and fire, the city expects to pay 66 cents additional cost for every
dollar of payroll in the upcoming 2012-13 fiscal year.
For other workers, the city will pay 52 cents. That works out to a total of
about $251 million for the year, a figure expected to rise to $320 million by
Before the staff reductions and pay cuts implemented last year, the city was
looking at a tab of about $400 million for 2015-16. The union and NBC Bay Area
furor focuses on past comments by the mayor and retirement system director that
the number might be larger than $400 million. In fact, it probably should have
been much more, a point the unions and the reporter ignore.
The retirement system forecasts hinge on investment assumptions of 7.5 percent
annual returns, which they have a less than a fifty-fifty chance of meeting.
Using more realistic assumptions, the original $400 million forecast and the
current $319 million projection would increase significantly.
Moreover, the unions and NBC miss the bigger point: These amounts include only a
small payment toward the unfunded liability, a debt for work that has already
For pensions, the city is making the minimum payment on its mortgage, leaving
most of the balance for future generations. For retiree health, it’s worse: Only
part of the minimum payment is being covered. This is a potential train wreck
left for future generations to clean up. The mayor deserves credit for trying to
avert a disaster.
• • • • •
Assemblyman Jim Beall, who
was supportive of Police and Fire when he was a San Jose councilman, has jumped
into the fray of the pension reform issue. This story was part of Monday's
Audit of Pension Costs Urged
reveal plans amid mounting criticism of mayor’s push for reform—
By Howard Mintz
Mercury News — March 5, 2012
Stepping into the conflict over the scope of San Jose’s
public employee pension problems, a group of state lawmakers on Monday plan to
reveal a campaign for a state legislative audit of the city’s finances and
Led by Assemblyman Jim Beall, a group of seven South Bay legislators will ask
the Joint Legislative Audit Committee to conduct the audit, saying it is needed
to resolve a heated debate over Mayor Chuck Reed’s projections of the city’s
Assemblyman Jim Beall,
effort to seek audit
The audit request comes on the eve of a City Council
meeting Tuesday to consider whether to modify a June pension reform ballot
measure that Reed is pushing to ease the growing costs of employee retirement.
Employee unions have criticized the mayor for his estimate of $650 million in
future pension costs, saying he inflated the figure by hundreds of millions of
dollars to solidify his political arguments.
“This request’s purpose is to get a neutral and independent evaluation of the
city’s pension costs, which has become a source of contention,” Beall said. “I
hope this audit will produce solid information that both sides at the table can
accept to, perhaps, develop new strategies.”
State Sens. Elaine Alquist, D-San Jose, and Ellen Corbett, a San Leandro
Democrat and Senate majority leader, have joined in the audit request, along
with Assembly members Luis Alejo, Paul Fong, Rich Gordon and Bob Wieckowski.
Last week, San Jose City Manager Debra Figone told a City Council committee that
her office will prepare a memo by the end of March outlining the origins of the
$650 million estimate, which Reed has called a worst-case scenario for pension
costs by 2015. Five council members backed by employee unions had previously
demanded explanations for the estimate of the city’s pension obligations.
• • • • •
Just hours before the City
Council voted on the pension reform ballot measure the Mercury News published
Pension Reform Vote Can’t Wait
Editorial — Mercury News, March 6, 2012
The prelude to Tuesday’s San Jose City Council vote on a pension reform
ballot measure has devolved into a three-ring circus — with the clown imported
from Sacramento, where Assemblyman Jim Beall wants a legislative committee to
audit San Jose’s pension system for purely political purposes.
Meanwhile, unions continued to suggest reform alternatives that would not work,
and council members opposing the measure lined up their “Of course we all want
reform, but ... ” arguments.
Enough. Tuesday is the last chance to put a measure on the June ballot. The
council majority must move ahead. Waiting until November would leave too little
time to resolve disputes in court and implement the cost savings in 2013.
This week’s performances were nothing compared to the union-orchestrated
extravaganza last month over Mayor Chuck Reed’s use of a worst case pension cost
estimate last year. But Beall gave it his best shot Monday. The former San Jose
councilman blustered in front of City Hall, showing that either he doesn’t
understand how San Jose pension forecasts are developed and utilized, or he has
completely sold out to unions.
About a year ago the city retirement director, responding to a council question,
gave a worst case rough estimate of pension costs that Reed picked up on. Even
if the number were totally fabricated, it would change nothing about City
Council decisions since. Independent actuaries and San Jose’s two pension boards
produce and approve the official cost projections on which the City Council has
based every single action on pensions, and on which it will base Tuesday’s
Reed and some council members are trying to succeed where Sacramento
consistently fails. They are working on long-range fiscal reforms so the city
can weather future downturns, provide services more economically and ensure that
costs are paid by people benefiting from them, not pushed onto future
generations like the state pension system.
Columnist Dan Borenstein calculates the unfunded liability for San Jose’s
employee pension plans at $11,000 per city household.
Significantly lower pension costs for the current year are a result not of bad
estimates but of last year’s layoffs, including police officers, and
corresponding service cuts, from shuttered libraries to scaled-back anti-gang
work. San Jose needs to restore those and other services. If it does not reform
pensions before it starts rehiring, then the bills will just shoot back up.
The ballot measure is imperfect. It includes an opt-in provision for existing
employees, something unions first proposed but the Internal Revenue Service has
yet to approve. We believe it will stand up. Some object to the provision that
voters have to approve any future increase in benefits — but that’s how San
Francisco, that well-known anti-labor bastion, does it.
San Jose workers have taken pay cuts and gone years without raises. They deserve
better. The city will have to offer better pay in the future to compete with
other employers. But future increases should be in salaries. Workers can decide
to save some of it for retirement on top of their pensions, or not.
Council members Rose Herrera, Sam Liccardo, Madison Nguyen, Pete Constant and
Pierluigi Oliverio are expected to join the mayor in forging ahead with reform
Tuesday. We hope others join them.
Enough. Tuesday is the last chance to put a measure on the June ballot. The
council majority must move ahead.
November would be too late.
Did this editorial actually
refer to former San Jose Councilman and current Assemblyman Jim Beall as a
"clown from Sacramento?" Had a conservative newspaper run an editorial that
referred to an elected official as a "clown," the Mercury News would be all over
it like stink on a block of Limburger cheese.
• • • • •
It's hardly a coincidence
that the paper selected this letter to the editor to be positioned next to the
Audit San Jose? What About Your
Letter to the
Editor — Mercury News — March 6, 2012
Very interesting. State legislators, led by Assemblyman
Jim Beall, want to audit the city of San Jose on its pension costs.
This independent look coming from legislators that can’t even get their own
budget problems solved?
Seems to me that they ought to concentrate on how to get their own house in
Carl E. Cookson,
• • • • •
Perhaps Mayor Reed and State Assemblyman Jim
Beall should don some rain gear as it looks like they are engaged in a pissing
match. On the front page of the local section of the same (March 6th) paper was
Mayor Fires Back Against Calls
for City Audit
By Mark Gomez
Mercury News — March 6, 2012
Mayor Chuck Reed said a call Monday for an audit of the city’s finances and
pension costs is another attempt by unions and their political allies to derail
a pension reform measure proposed for the June ballot.
The request for an audit came from seven local state legislators just as the
City Council is scheduled Tuesday to vote on revised ballot wording for the
measure, underscoring the high stakes for the city government and its employees.
“Our city hall unions know very well that there is strong voter support for
pension reform,” Reed said. “They’re doing everything they can to keep it off
the ballot. And they have a lot of friends in the state Legislature. There’s no
secret about that.”
During a press conference Monday morning outside City Hall, Assemblyman Jim
Beall said he and six other local legislators are asking the state auditor to
look at the mayor’s worstcase projection that escalating pension costs could
reach $650 million a year. Unions allege Reed’s estimate is inflated by hundreds
of millions of dollars.
The legislators are also asking a state audit committee to review the city’s
operating budget for the past three fiscal years and all actuarial reports
projecting pension obligations.
The request for the audit was signed by Beall and state Sens. Elaine Alquist and
Ellen Corbett and Assembly members Luis Alejo, Paul Fong, Richard Gordon and Bob
Wieckowski, the only other of the seven to attend the press conference.
If the audit committee approves the audit, it will then vote whether to give it
The pension predicament in San Jose is very similar to several other cities in
California, Beall said.
When asked about the San Jose ballot measure, Beall said the city should “hold
off until state laws and pension reform efforts are conducted.” He also said the
state is considering several bills that could affect city pensions. He added
that California cities fall under a 1937 Pension Act and thus are governed by
state laws. But after San Jose officials disputed that, Beall later said he
misspoke and that only county pension systems are governed by that law.
Reed called the move by state legislators “one of many efforts to try to get us
to not to ask the voters to vote on this in June.”
Nonetheless, Reed said the city “would not object to an audit of the city’s
pension obligations that is fair and objective and follows nationally recognized
government auditing standards.” Jim Unland, president of the San Jose Police
Officers Association, said his group welcomes the audit.
“We’ve been suspicious of this number of $650 million for about a year now,”
Unland said. “Is that number a professional staff estimate, or a guesstimate?”
The mayor’s office projects the pension reform will save taxpayers “hundreds of
millions of dollars” over the next 10 years.
Annual pension costs in San Jose have tripled over the past decade from $73
million to $245 million out of the general fund that pays for police officers
and librarians, according to city officials.
In December, a divided council approved a pension reform measure for the June
election, but held off sending it to the Santa Clara County Registrar of Voters
to allow for changes based on mediation talks with workers.
Since then, there have been 20 mediation sessions with city officials and San
Jose’s 11 unions, and the language on the ballot reform has changed seven times
“in response to things we heard from the unions,” said Michelle McGurk, a senior
policy adviser and spokesperson for Reed.
The city must submit the language by March 9 to meet the deadline for the June 5
Under ballot wording that the council will consider Tuesday, new city employees
would pay half of the cost of their retirement benefits in a lower-cost plan,
according to the mayor’s office. Current employees would also have the option to
choose a lower cost plan and avoid paying higher costs.
The ballot measure also would reform disability retirement rules to prevent
abuses, eliminate bonus payments to retirees, and require voter approval for any
future retirement benefit increases.
“We have severe needs in the city that are not being met,” Councilman Sam
Liccardo said. “We are not going to meet them by paying pensions and retirement
benefits that nobody can reasonably afford.”
• • • • •
As nearly all of you know
by now, Mayor Reed's pension reform measure will be headed to the June ballot,
and it doesn't take a mind reader to realize it will pass by a vast majority of
the voters. Here's the story of Tuesday's 8 to 3 City Council vote from
yesterday's (Wed.) paper.
Pension Fight Heads to Ballot
pleas, council advances measure to give voters say in cutting benefit—
By John Woolfolk
Mercury News — March 7, 2012
After years of cutting budgets and months of postponing
a tough vote, the San Jose City Council on Tuesday put a measure on the June
ballot that would trim city worker pensions whose ballooning costs have devoured
funding for city services.
The 8-3 vote after three hours of debate and testimony was a key victory for
Mayor Chuck Reed, who has made pension reform a centerpiece of his
administration. It promises to make the city a focal point in the national push
for pension reform, heading into what is certain to be an expensive and bitter
“The time has come for the council to take action,” said Reed, who has spent
years working to change the pension system. “Today is the time to act and give
the people of San Jose a chance to decide.”
Councilmen Ash Kalra, Kansen Chu and Xavier Campos were opposed, siding with
city labor unions who argued the city must negotiate benefit changes with its
workers and that a ballot measure would be needlessly divisive and legally
“I realize the pension system is broken and we need to fix it,” Chu said. “The
question for me is how harsh should the pendulum swing? We’re dealing with human
beings and their lives, not just raw numbers.”
But the surprisingly wide margin for approval on an issue that has divided the
council reflected a sense among the city’s elected leaders of voter anger over a
decade of cutbacks in city services — from police and fire protection to
libraries — to cover rising costs for benefits more generous than those offered
by private employers.
“My first obligation is to my constituents,” said Councilwoman Nancy Pyle, who
argued pension reform will be key in seeking voter approval this year for a tax
measure. “They have spoken, long and hard.”
The vote came amid growing outcry from unionized city workers who argued it
would be illegal and who have sought to sow doubt in recent weeks about the
city’s assertions about the pension problem. Five unions representing city
police, firefighters and other workers said in a statement after the vote that
“the mayor and his supporters scored some political points today, but only time
will tell what the ultimate cost to our city will be.”
firefighter speaks out against the pension
proposal at the City Council meeting.
Reed’s pension reform proposal has drawn national interest, with San Jose among
only a few California cities moving to give voters a say over growing costs of
public employee retirement benefits that have become a concern throughout the
San Diego also is seeking a June ballot measure to shrink pension costs. San
Francisco voters in the fall approved the milder of two pension reform measures
on the ballot.
The issue drew a capacity crowd to San Jose’s council chamber Tuesday. Most were
city union members and their supporters.
“My union and I personally have been scapegoated,” said Yolanda Cruz, president
of the city’s largest employee union, whose workers include librarians. “Imagine
how the past year could have been if the city manager and city leaders had
worked with employees to find a negotiated solution.”
Reed noted that the proposed ballot measure has been softened substantially in
more than a half-dozen revisions to reflect eight months of talks and mediation
with city unions. Tuesday’s vote was about replacing language the council had
approved in December with milder terms to address concerns raised in mediation.
Friday is the deadline for submitting language to the registrar of voters for
the June 5 ballot.
City workers had offered pension concessions in negotiations. On Friday, police,
firefighters and three other unions made a fresh proposal that called for
employees to pay more if they don’t switch to cheaper retirement plans.
But city leaders have argued the union offers are insufficient. Councilman Sam
Liccardo said the latest offers fell short because they didn’t require workers
to share the cost of unfunded liabilities that can build up in the pension
system when expenses exceed assumptions. San Jose’s pension system now has
billions of dollars in unfunded liabilities that currently must be paid solely
by the city and its taxpayers.
Reed and other council members said they were confident the reforms called for
in the proposed ballot measure would survive the inevitable union legal
challenge. He argued much of what the measure calls for — reduced benefits for
new hires, making current workers pay more for their pensions — has been done in
scores of other cities.
“What we are doing is not unusual,” Reed said. “I’m quite comfortable with our
Some residents, business owners and even public officials urged the council to
move ahead with the ballot measure. Jeff Cristina, director of Environmental
Services at GreenWaste Recovery in San Jose, noted the sharp rise in city
retirement costs, from $73 million to $245 million in the past decade.
“That shows the true problem,” Cristina said. “Let the people decide what
happens to their city.”
County Assessor Larry Stone, noting he’s a career public employee, also urged
support for the pension reform measure.
“We need significant reform, not just incremental reform,” Stone said. “Why?
Because the current system is unsustainable.”
• • • • •
Not surprisingly, columnist
Scot Herhold offered his two-cents about the council meeting vote that will
place the pension reform measure on the June ballot. This is also from
yesterday's (Wed.) paper...
Fact: Politics and Money Rule
Mercury News — March 7, 2012
The union folks wore badges that said “Facts Matter,”
and everyone summoned their own facts Tuesday inside the San Jose City Council
Facts about unsustainable costs.
Facts about erroneous projections. Facts about a pension that no longer covers
the rent for a disabled woman.
But as much as people saluted them, it wasn’t the proffered facts alone that
swayed the outcome when the council voted 8-3 to put Mayor Chuck Reed’s pension
reform on the June ballot. The theater on the dais featured two more primal
themes: money and politics.
It might have been the most historic council meeting in my memory, certainly of
the past decade. What was happening was essentially a wresting of expectations
from employees who have enjoyed a sweeter deal than the city can afford.
As Councilman Sam Liccardo pointed out, this wasn’t the fault of the employees.
Unions exist to bargain for better deals for their workers. And over the years,
the council has generously acceded, granting cops and firefighters 90 percent
pensions after 30 years.
Once upon a time, when San Jose flattered itself that it was the capital of
Silicon Valley, that might have seemed affordable. It no longer is. And so the
council was voting for a measure that would impose bigger burdens on employees.
A loud shrug
The rest of us might shrug: Few people in the valley have assured pensions.
If we have anything, it’s a 401(k) that waxes or falls with the market. The
concept of an assured 90 percent pension, even 75 percent, strikes as an
impossible gift from the Tooth Fairy.
For a cop retiring with a $90,000 pension, a little less than the average, the
assured cost-of-living increases mean the city will spend about $1.2 million
over a decade just on his retirement. Generosity like that makes it tough to
pave roads or keep libraries open.
And yet those facts didn’t convince the audience Tuesday.
The hearing attracted folks who will have to pay more for their pensions. It
brought in people who see their automatic 3 percent cost-of-living increases
“This is the wrong action to take,” said Bob Leininger, a spokesman for retired
employees. “We have had discussion and dialogue. If you take this vote today,
In a word, the city employees and retirees could grasp the bleak threat of
losing promised money. It was no surprise to hear the occasional catcall or the
burst of applause for labor guru Bob Brownstein’s denunciation of the mayor’s
All this thrust the council members into the position of amateur dentists trying
to perform a root canal. Trust me: Council members would prefer to handle almost
any other topic.
Airport bonds, sewage loads and rainfall projections would offer blessed relief.
So before the vote came the necessary theater: Both council members Don Rocha
and Nancy Pyle, who voted to put the measure on the ballot, denounced the
demonization of city employees.
(In fact, there was no demonization I heard of employees Tuesday: But if you
faced losing pay and benefits, you might feel demonized, too).
In the end, the council members are working politicians.
They know what their constituents think. They have probably seen polling. And
voting against putting something on the ballot — asking the people to decide —
is always risky. Those are the facts that commanded the result on Tuesday.
• • • • •
This story from the front
page of today's (Mar. 8th) Local Section seems to have the editorial board of
the Mercury News seeing red, as you will read in the editorial that follows. The
same color may also apply to the eyes of Mayor Reed and his City Manager...
State Legislators Order San
Jose Pension Audit
officials fear review is motivated by Democratic lawmakers’ ties to unions—
By John Woolfolk
Mercury News — March 8, 2012
The state will audit San Jose’s finances amid employee
unions’ accusations that city officials overstated the cost of the pension
system to build support for a June ballot measure reducing retirement benefits.
The Joint Legislative Audit Committee on Wednesday approved the state audit,
requested by seven Democratic lawmakers, on a bipartisan 10-3 vote. The
committee also directed the auditor to give it priority status on a 12-1 vote.
Committee member Chris Norby, R-Fullerton, did not vote.
“My role as chairman is to ensure that we’re doing everything we possibly can to
protect our taxpayers’ money,” said Assemblyman Ricardo Lara, D-South Gate. “In
this unique situation with the city of San Jose, we have to make sure the
numbers the city is using are actually correct. So I supported the audit along
with a number of elected officials who represent the San Jose area. We got
bipartisan support, which goes to show you it’s not something we are taking
lightly here in Sacramento.”
San Jose officials questioned the need for the state audit. They noted the
city’s retirement system already has been extensively audited, and cited
concerns that further state review — urged by lawmakers backed by public
employee unions — could be politically motivated.
“As long as it’s not a politically slanted inquiry, that’s fine,” Mayor Chuck
Reed said. “The facts are the facts.”
San Jose City Manager Debra Figone said that auditors regularly review the
certified annual financial reports on the city’s finances and its independently
governed and pension plans. In addition, the pension funds are examined by
actuaries and have been independently reviewed in a 2010 city audit, a 2010
civil grand jury, a 2011 report by the state’s Little Hoover Commission and a
2011 report by the Stanford Institute for Economic Policy Research.
“We believe our retirement costs have been thoroughly vetted, both internally
and externally,” Figone said in a letter Tuesday to the committee. “If a state
audit were to be conducted, we respectfully ask that this not be done for
political purposes or as an attempt to delay or distract from the real issues.”
Lara said the audit will cost state taxpayers $189,000 and added that it’s “not
unusual” for the state auditor to examine local finances. The state auditor is
currently examining the city of Vernon and Salinas Valley Memorial Hospital. The
priority audit is expected to begin “in a week or so,” he said, and be completed
in four to six months.
Voting against the state audit were Sen. Bob Dutton, R-Riverside; Assemblyman
Tim Donnelly, R-Hesperia; and Assemblyman Cameron Smyth, R-Santa Clarita. Sens.
Joel Anderson, R-Temecula, and Doug La Malfa, R-Rocklin, joined the Democrats in
supporting the state audit.
Assembly members Jim Beall, D-San Jose; Luis Alejo, D-Salinas; Paul Fong,
D-Mountain View; Rich Gordon, D-Los Altos; and Bob Wieckowski, D-Fremont, as
well as state Sens. Elaine Alquist, D-San Jose, and Ellen Corbett, D-San
Leandro, requested the audit in a letter over the weekend.
In the request, the group said it sought the audit to ensure San Jose was
“working from commonly accepted budget and pension obligations figures” as the
city “and all its constituents work to develop the 2012-13 budget, negotiate
employee contracts, and address pension benefits for employees.”
The group also asked state auditors to focus on differing pension cost
projections for 2015-16, ranging from $300 million to $650 million, which have
become a source of debate. The higher figure was a rough estimate offered by the
city retirement director at a meeting a year ago using pessimistic assumptions.
City officials said current projections of about $309million reflect reductions
in payroll from layoffs and 10-percent pay cuts made last year to ward off a
budget deficit. The city now projects a surplus in the next budget year,
although deficits are expected after that as pension costs continue to rise.
San Jose’s employee retirement bill has more than tripled in a decade from $73
million to $245 million.
The audit committee vote came a day after the San Jose City Council agreed to
put a measure on the June ballot that would reduce pensions for new hires and
make current employees pay more toward the benefit if they don’t switch to a
Beall, a former San Jose councilman, said in a statement that he supports
pension reform, but, he added, “it’s imperative the city obtain clear facts as
it goes forward.”
“This audit accomplishes that and committee members — Republicans and Democrats
— recognized that,” Beall continued in the statement. “The audit will help guide
us with drafting comprehensive pension reform legislation. Today’s vote also
reflects the Legislature’s interest in the state becoming better watchdogs.”
• • • • •
We are close to the end of
this week's pension coverage as far as the Farsider is concerned. All that's
left is this editorial and two letters to the editor from the op/ed page of
Voters Now Have Time to Sort
Out Pension Facts
Mercury News — March 8, 2012
Speakers at the pension debate at the San Jose City
Council meeting Tuesday appeared to come from different factual universes — not
just those in the audience, but also members of the council.
Some see the pension reform measure on the June ballot as demonizing workers.
Others see it as a way to keep the pension plans solvent while restoring
services that have been cut beyond what’s healthy for city neighborhoods. It is
a stark divide.
Fortunately, voters have until June to sort through the rhetoric and the numbers
— which aren’t off-the-cuff estimates, but official projections done by
independent actuaries and approved by the city’s independent pension boards.
Don’t wait for that politically motivated state audit of San Jose pensions that
legislators pushed through Wednesday, however; it won’t be finished before the
June election. Here’s a thought: How about just giving San Jose the $189,000
that the audit will cost so it can hire back a laid-off police officer or two?
Most city union leaders now say some pension reform is needed, a tacit admission
that the current plans are not sustainable. The pension bill for the coming
budget year is less than expected, but that’s because of all the layoffs,
eliminated positions and pay cuts since the most recent analysis, not because
happy times are here again. Even with current employment levels, actuaries say
the plan has a long term unfunded liability of $3.5 billion.
Until recently, we thought that some city unions were earnestly trying to reach
agreement on reform. Then last month, they turned from negotiation to street
theater to discredit Mayor Chuck Reed’s reform proposal. At this point, voters
need to act.
Reed’s initial proposal for reforms last summer was extreme and largely illegal.
The plan that passed with an 8-3 vote Tuesday is far more reasonable and more
likely to hold up in court. Some provisions may need tinkering down the road,
but that’s OK. San Francisco requires a public vote to change pension
provisions, and it manages to update its plans.
The council’s priority at this point should be implementing a second-tier,
reduced retirement plan for new hires. Even with the cutbacks, some key
positions are being filled, and new employees still go into the existing plans.
The city has reached impasse with its unions on the second tier, according to
Employee Relations Director Alex Gurza. Police and fire unions are headed to
arbitration, but for non-safety workers, the council could implement a plan at
any time. Setting a plan for new hires will not affect existing employees or
Contrary to various speakers Tuesday, the ballot measure will not “take away”
anybody’s pension. It will scale back some promises, but those promises were
made at a time when prosperity seemed boundless. Today, many taxpayers are
reeling from home foreclosures, loss of 401(k) investments and loss of jobs —
or, if they’ve kept their jobs, lowered compensation.
Everybody longs for the heady days at the turn of the century, but few can
insist that their incomes and benefits must go untouched regardless of what
It is not demonizing or blaming city workers to ask that they adjust their
Don’t wait for that politically motivated state audit of San Jose pensions that
legislators pushed through Wednesday. It won’t be done in time.
• • • • •
Ending this "Local News for
Out-of-Towners" column marathon were these two letters to the editor that
appeared beside the editorial above...
City Makes Right Call on
Letter to the
Editor — Mercury News — March 8, 2012
Kudos to our mayor and the seven City Council members who voted for moving
forward on pension reform. Our city cannot continue awarding lush retirement
packages to its employees while cutting essential services.
Razzies to Assemblyman Jim Beall and his Sacramento cohorts who have chosen to
carry water for the unions.
Hopefully, voters will remember this when choosing the next state senator to
represent most of San Jose.
Mayor Chuck Reed’s highend projection of $650 million is irrelevant. Retirement
contributions from the general fund increased by more than $170 million over the
past 10 years, while employment has fallen significantly.
Fewer city employees receive much more, while we residents receive substantially
less. It is time for the pendulum to swing back toward the center.
~ ~ ~
Outrage Over City Pensions is Misplaced
Letter to the Editor — Mercury News — March 8, 2012
I really wish people would stop calling deferred compensation plans a “benefit”
to workers as if somehow a pension is categorically different from other forms
of pre-negotiated entitled compensation, such as salary, wage, vacation or
The outrage directed at public employees because compensation in the public
sector seems more generous than in the private sector is misplaced. It used to
be that public workers’ retirement plans made up for their lower wages. What’s
been happening to wages in the private sector to make city employees’
compensation seem lavish in comparison? The outrage private employees have
should be directed at their employer for lowering their wages in times of record
profits, at themselves for buying into corporate/ conservative rhetoric that
unions hinder economic growth and toward those who showed incompetence in
directing the city’s retirement funds.
If private-sector employees are jealous of compensation packages enjoyed by
union workers, why don’t they work to make their lives better through collective
bargaining instead trying to make public employees’ lives worse?
Final Note: Look on the bright side. Had our pensions been based
on 401(k)'s instead of our own Police and Fire retirement plan, many of us might
well be living in this community today...
RUMOR OF TIE
BETWEEN REED AND MERCURY NEWS APPEARS TO HAVE BEEN QUASHED
Last Sunday's "Internal
Affairs" column in the Mercury News seems to have put to bed a rumor about a
family tie between Mayor Reed and the paper's editorial board. We've heard the
rumor over the past few weeks, but didn't pass it along in the Farsider because
we were unable to confirm or deny it. This "IA" column explains...
Newspaper’s ‘Ties’ to Reed are
Tenuous at Best
Internal Affairs column — Mercury News — March 4, 2012
You may have heard that lots of San Jose cops,
firefighters and other workers have cooked up a new conspiracy theory behind
what they claim is our paper’s soft coverage of Mayor Chuck Reed — whom they see
as Satan himself for his effort to make their generous pensions less generous.
The mayor’s sister, they proclaim, is married to a top Mercury News executive!
Their facts and math are no better aligned here than with their pensions.
Reed’s sister, Sandy, is married to former Merc executive editor Bob Ingle .
But Ingle left the Mercury News in 1999, when it was owned by now-defunct Knight
Ridder. Reed wasn’t even elected to the City Council until the following year.
By the time Reed became mayor in 2007, the Mercury News had been sold by its
investors and now is owned by MediaNews Group.
Current Publisher Mac Tully and Executive Editor Dave Butler, both installed by
the new company, never worked with Ingle and have no family ties to him or the
mayor. Few of the Merc’s remaining staff would even recognize Ingle.
Tully insists the paper’s coverage has been fair: “I doubt Mayor Reed thinks
we’ve been unfairly kind to him — which means if neither side feels we’re being
overly favorable to them that we’re probably doing our job correctly.”
~ ~ ~
Internal Affairs is an offbeat look at state and local politics. This
week’s items were written by Tracy Seipel, Scott Herhold and Lisa Fernandez.
Send tips to <internalaffairs@mercurynews>.
WEEKLY SNOPES URBAN
LEGEND UPDATE AS OF MARCH 3, 2012
behind the legends, information and
misinformation that has or may show up in your inbox
fiction: A boy left his bike chained to a tree
when he went off to war in 1914. He never
leaving the tree no choice
but to grow around the bike?
• Phishing scam poses as e-mail notification from Intuit confirming a
• Photograph purportedly shows a tree that grew around
a bicycle left behind by a boy who went off to war.
• Image purportedly captures a bear seconds before it mauled photographer
Michio Hoshino to death.
• Are drug dealers selling colored and flavored crystal methamphetamine known
as "Strawberry Quick?"
• Photographs purportedly show a spider devouring a
snake caught in its web.
• The etymology of the phrase 'another kick at the cat.'
• Pranksters affix a license plate stolen from speed trap camera van to their
• Don't forget to visit our Daily Snopes page for a collection of odd news
stories from around the world!
Worth a Second Look
• Did a teenager whose mother died receive a government
check mailed to "Mrs. Passed Away?"
Still Haunting the Inbox
• Check out our 25 Hottest Urban Legends list to keep
abreast of what's circulating in the on-line world.
• Visit our Top Scams page for a list of schemes
commonly used by crooks to separate the unwary from their money.
THE LIGHTER SIDE &
OTHER ODDS AND ENDS
Remember to click on the "Large
Player" icon on the YouTube control panel in the lower right-hand corner when
you watch the first clip. If you do, all other YouTube videos should default to
the same setting throughout the rest of your session at the computer.
• • • • •
This is Christina in a wetsuit inside a tank full of sharks...
Dewey Moore calls this clip
truly extraordinary, and I'm of the opinion that the accompanying musical track
makes it even more so. Watch Christina interact with the sharks, especially the
one at the end of the video. (4 Mins.)
• • • • •
David Byers sent in this
Nov. 2011 clip of former game show host Chuck Woolery ("Wheel of Fortune" and
"Love Connection") pontificating on how the Feds could have cut the $1.2
trillion over ten years that had been promised. He makes a lot of sense. Perhaps
he should have entered the race for POTIS. After all, a former actor had what it
takes. Why not a former game show host? (3 Mins.)
• • • • •
As Treasurer of the PBA,
"Lumpy" (Larry Lundberg) is far more adept at finances than the rest of the
membership — or at least he wants us to think he is. (Some of us have always
wondered why he takes the PBA checkbook with him when he goes on vacation six
times a year, but that's another topic.) Regarding the nation's Social
Security system that was destined to go bust a few years down the road, Lumpy
was happy to provide us with some breaking news. If this report is accurate,
Congress has finally found a solution to the problem and passed a bill that will
keep the Federal Ponzi Scheme flush with cash for the next several generations.
Have a look and listen, but be aware that the news report includes a naughty
term that would make FCC officials wet their pants. (2
• • • • •
Lumpy also sent in this item that is as amazing as it is spooky.
Click on the link below, then follow the instructions and you should wind up
with a crystal clear image of your residence. And if this works for you like it
did for me, you'll be able to use your mouse to zoom in and out and pan up and
down your street. You will also be able to switch to an aerial view of your
neighborhood. If it doesn't work for you it's probably because your digs are not
yet in Google's database. (Time depends on you.)
My residence in Fremont...
• • • • •
Commando Transformer video sent in by Don Hale is pretty slick, whether you know
anything about Norton motorcycles and transformers or not.
• • • • •
Don also sent us this video
of a test by Boeing of a rejected take-off of a fully-loaded 747-8 freighter
weighing nearly a million pounds. If the Seattle aircraft company sent this out
on the Internet for the purpose of building confidence in their product, they
certainly succeeded in my eyes. (3 Mins.)
• • • • •
Look carefully and you
should be able to see a cat peeking at the dog from the far side of the bed in
the upper right. The canine thinks it is intimidating the feline, but watch what
happens when the cat has had enough of the barking. (1
• • • • •
While still on the subject
of man's best friend, imagine that you have a small dog that watches closely as
you play your piano and sing. Got the picture? Now imagine you left your house
to run and errand and left the dog alone while the video camera was running.
• • • • •
Ever heard of creating art
using salt? Neither had I until I watched this clip sent in by Stan Miller. No
joke. (3 Mins.)
• • • • •
Get better than 10 of the 20 questions correct on
this timed Neurological Skills Test on your first try
and you will be able to claim bragging rights over most
people. (Time depends on you.)
• • • • •
Just when I thought I had
included all the Ray Stevens' ditties worth passing along, another one falls
into my inbox courtesy of Chuck Blackmore. This one is titled "Stuck On You,"
and it's presented in such a way that makes it possible for you to sing along.
• • • • •
With all the bad news we've
been subjected to this week, perhaps this final item will lighten things up.
This video from Bruce Morton made me realize how badly I miss Johnny Carson,
especially when he had guests like Dom Deluise on his show. Unlike Leno and
Letterman and the other late-night wannabes, the then-master of late night TV
got laughs without tearing down presidents presidential candidates and other
famous people. In this clip Johnny and Dom perform the amazing egg trick.
• • • • •
That's all we've got. Thanks for visiting.
Pic of the Week:
|This is the message box, using the