Saturday, February 28, 2009

Dayton, OH - City Manager says Fire, police must diversify

Dayton Daily News

"DAYTON — Dayton City Manager Rashad Young said Friday, Feb. 27, the decision to settle a U.S. Department of Justice lawsuit that alleged discriminatory testing practices is not an admission of guilt the city did anything wrong.

Young reiterated that the outcome of the settlement, regardless of opinion of its virtue, must be that the city makes its police and fire departments more racially diverse.

'The current makeup of the public safety departments do not reflect that of the community,' Young said."

Note from Ron York - Mr. Young is right. I hate the use of the word diversify, but that is a discussion for another day. It is my opinion that people whose linage comes from Africa and Southwestern Europe are under represented in public safety , although they are a significant portion of our citizen population. I say this from first hand observation all across the country. Currently, this issue is being navigated by a group of people with much more narrow goals than those espoused by Martin Luther King. Instead of advancing an end of our segregated society, most of these "consent decrees" and forced settlements just widen the divide. Until enough of us get involved in rectifying this family sin we seek to deny and hide, this side show will continue to be driven by shakedown artist, pimp lawyers, heavy handed bureaucrats, and frustrated judges. We can end the side show. Do the right thing - treat everyone with dignity and respect.

Friday, February 27, 2009

Anatomy of a Paycheck


Pensions and health insurance are being attacked from all angles today. Public safety pension and employee health insurance, in general, are in the crosshairs of political groups of many persuasions. The problem with all of these precision attacks is that they only focus on one or two items. Looking at pensions or health insurance by themselves is of no value. No employee is being paid entirely with pension and insurance. While important, they are only slices of the pie. The pie, in its entirety, is where the attention needs to be paid. To help explain this, I have provided a mock interview with a corporate CEO to explain the outlook on pay and benefits from their perspective, a mock case study for a real life example, and a school board meeting to demonstrate typical objections that are heard over pay and benefits.

To start, we will go through the interview. This interview is with the CEO of a large corporation, Acme Inc. As you know, government would be much better off if it were run like a business. The CEO we are interviewing is well known for being a tough as nails administrator.

Ron: Good morning Mr. CEO and thank you for taking the time to talk with us today.

Mr. CEO: Make it fast. I have a lot of work to do.

Ron: Mr. CEO – how do you feel about your company having to pay nearly $20,000 a year for each of your employees for their retirement and health insurance?

Mr. CEO: So what? I do not care what we pay for those items.

Ron: I do not understand. That is a substantial expense for your company. Wouldn’t that money be better spent on other things, such as R&D?

Mr. CEO: Look man, we do not pay for those items. We just lower the base pay enough to cover them. Listen to me very closely. We pay $100,000 for each of our employees. I do not care how they get the money – in a paycheck or in benefits. We pay $100,000 in total. Period!

Ron: I see. This brings up another question. Why don’t you just pay them $75,000? After all, you are the boss and everyone knows that the boss sets the wages.

Mr. CEO: Where have you been man? Living in a log cabin in Montana? I would pay minimum wage if I could still get the people I need. It does not work. Trust me.

Ron: I think I understand. How did you arrive at the $100,000 number?

Mr. CEO: We tried paying $90,000 and few qualified applicants applied. We tried paying $110,000 and we had to hire a security guard to control the crowd of applicants. $100,000 gets us what we need.

Ron: I think I have got it. You have determined that a total wage package of $100,000 yields the quality and quantity of applicants you need and you do not care how the money is paid. You have no problem with the obscene pension your employees receive.

Mr. CEO: That’s right. Are we done? I need to get back to work. Oh, it is a good thing you do not work here.

Ron: And why is that?

Mr. CEO: I would fire you – you loser.

Ron: I think we are done here.

Now, let’s move into a case study that illustrates what Mr. CEO was talking about. Let’s use a school teacher’s position as our example. It is easier do this with a school teacher because it is already structured the way my example needs to be to drive home the points, also, it is not as emotional for you.

The job pays $72,000 per year and requires you to work 1,440 hours (September through May) with no paid time off. If school is in session, you have to be there or pay for a substitute. The school district offers a defined contribution pension plan that matches a your contribution two-to-one up to 16% (24% total with the employee contributing 8%). Your pay is reduced by the amount of the district’s contribution.

The district has one insurance plan that costs $7,200 per year. The district will pay this for you, but your pay will be lowered by $7,200. In addition, you have three payment options for you actual paycheck. Assuming that you forego the pension and insurance, you have three possible payment options. Option 1, you can receive 12 monthly checks in the amount $6,000. Option 2 – you can receive 9 monthly checks in the amount of $8,000. Option 3 – You can receive one check for the entire $72,000.

Now, off to the school board meeting. Quiet, the meeting has already started. We are just in time for the public to address the board. The usual suspects are standing in line to speak. See how many of these invalid arguments you can refute.

Local taxpayer: I am here to voice my outrage concerning the pension we provide our teachers. It is crazy to provide for a 90% pension after 30 years of service. That is obscene. We cannot afford to continue to pay for these enormous pensions.

Local Teacher: I teach the fourth grade and get paid $6,000 per month. The teachers on both sides of my classroom came to work at the same time I did and they get $8,000 per month.

Another Taxpayer: During these hard and troubled times we need to be frugal with the taxpayer’s money. We need to quit paying teachers for not working. We currently have 300 teachers that are receiving paychecks for June, July, and August, but they do not work one day during those three months. We need to put an end to these welfare queens.

Another Teacher: I agree with the last speaker. If we took away that money being squandered on people who are not working, but receiving checks during the summer, we could give everyone a raise.

Another Taxpayer: We offer the Cadillac of retirement and health insurance benefits. To provide these lavish benefits, money is taken directly out of mine and every other taxpayer’s wallet. They are literally taking food out of my children’s mouths.

Another Teacher: It is not fair for me to have pay for my retirement and my health insurance. It should be a free fringe benefit and I should not have to take a reduction in pay or benefits I have earned and I am entitled to. I know that the district has lots of money and can easily afford to pay these basic necessities.

Another Taxpayer: Understanding compensation is more difficult than you realize. The total amount that teachers receive is more than $150,000 per year. If you take a teacher’s annual pay and divide it by the number of hours worked it comes to $50 per hour. Then you multiply that times the normal work schedule of 2,080 you get $104,000. Then you add a roll up cost of 25% for pension and insurance, plus the implicit value of having the summer off, it comes to just a little over $150,000. They get all of that for working only nine months out of the year. This does not include other little perks like the 10% discount that teachers get at the book store or the cakes and cookies parents send to them. They have got it made.

Another Teacher: As school teachers, we have the most important jobs in the city. Police officers and firefighters are paid much more than teachers. We should receive the same annual pay as fire and police.

This is a sample of the nonsense that is being presented at most local governing board meetings. Our school teacher position is going to pay a total of $72,000 no matter how you slice it or dice it.

The typical total compensation pie looks like the chart above. Pension cost is 15% of total compensation. Group insurance and retiree insurance are another 15%. Other direct pay is 70%. Do you really think we are going to flounder over the 15% retirement cost?

Here is a list of what I think are the most important points concerning compensation:

1) All that matters is total compensation

2) Pensions and insurance are not additional costs

3) Pensions and insurance are alternative methods of payment

4) Total compensation is dictated by the marketplace

5) Most pay plans are within 5%, plus or minus, of the market average

6) Those that are more than 5% from the average eventually self-correct

7) The current problem with pensions is primarily investment performance

8) In the long-run, the cost of funding public safety pension plans is constant

9) A 2.5% pension accrual rate requires a 21% total contribution

10) A 3% pension accrual rate requires a 25% contribution

11) A typical retiree insurance plan adds less than 2% to total compensation

12) Employees pay for pensions, not the employer

13) Employees pay for health insurance, not the employer

14) No employee is entitled to anything other than what the market demands

15) Pensions are not rewards for a job well done

16) Pensions are a forced savings plan using the employees’ money

17) Health insurance plans are forced discipline using employees’ money

18) Life is not fair, neither is compensation

Next, we will go to Tulsa – where two plus two is five every day of the week – for a look at step pay plans and their impact on year-to-year compensation cost.


San Bernardino, CA - This is like deja vu all over again - The Chief Is Retiring - Today (Sorry, Yogi)

The Press-Enterprise

"San Bernardino's embattled police chief and assistant chief will retire today and be hired back as contractors, the city manager said Thursday.

Chief Mike Billdt will earn $97.93 per hour and Assistant Chief Mitch Kimball will get $86.87 hourly, 10 percent less than they earn now, Interim City Manager Mark Weinberg said.

The police union has twice overwhelmingly passed resolutions of no confidence against Billdt.

Union leaders accuse the chief and his command staff, principally Kimball, of abusing their power by persecuting critics and rewarding supporters.

Last month, Billdt agreed to stay on past his scheduled March 1 retirement date to help as the city seeks a successor and to resolve the city budget crisis."

Thursday, February 26, 2009

POLICEPAY To Begin A New Series Of Controversial Articles - Guaranteed To Alienate Everyone


Tomorrow we begin a new series of articles that are designed to bring out the savage beast in each of you. We are going to kick everybody's dogma. Tomorrow we start with "Anatomy of a Paycheck." Those of you who like to carp about police and fire pensions are not going to be happy - trust me. Those of you who think that employer paid health insurance is a little insider's racket to scam the taxpayers are going to be livid. And you police officers and firefighters that think these two benefits are entitlements, well you are going to be mad also. Late tomorrow, call your mayor and invite him to go have a beer. You will have something in common - your mutual disdain for Ron York. It will be for different reasons, but that will not matter. By this time tomorrow, I should have totally unified Vallejo.

We will roll out the articles in The POLICEPAY Journal about 4:00 PM CST tomorrow. Over the weekend it will be posted on this blog. There will be six articles. All of them will be nuts and bolts in nature, but with a little humor thrown in to keep you awake. They will be several weeks apart. Here is the list:

Anatomy of a Paycheck
Anatomy of Step Pay Plans
Anatomy of Retiree's Insurance
Anatomy of Pensions
The Law of Supply and Demand (A Law That Even The Ninth Circuit Cannot Overturn)
The Truth About GASB 45 (Not The Folkfore You Been Told)

In the second installment, I am going to write the definitive piece on this topic. I am taking out Tulsa. The City of Tulsa is the remaining hold out claiming that step pay plans causes the payroll to go up perpetually. The City of Tulsa has become the Madalyn Murray O'Hair of mathematics. On many occasions I have encouraged them to prove me wrong or give it up. They do neither and continue promoting their SPI canard. I am going to win them over or shame them into exile. The articles are going to be explained in such simple terms, that even a caveman can comprehend. He may need therapy. After you read the first article, I think you will keep coming back.

Rockford, IL - Police talks delayed; - Doug Block's running for mayor (that is not a typo)


"Meanwhile, Doug Block took a leave of absence Wednesday as lead negotiator for the local police union. New negotiations sessions are awaiting the assignment of a new negotiator from the Police Benevolent and Protective Association Labor Committee.

Block said the leave of absence was necessary for his run to become Rockford’s new mayor during the April 7 election. He also canceled a planned vacation in March for the campaign."

Bozeman, MT - Mayor Asks City Employees to Give Up Pay Raises

The New West (Missoula, MT)

"In her annual State of the City address this week, Bozeman’s Mayor Kaaren Jacobson asked city employees to voluntarily forgo their annual pay increase to help save jobs at the city.

“I come to you at a time that’s not nearly as rosy as a mere 12 months ago,” Jacobson said in opening her speech, which she gave as part of the regular commission meeting Monday night."

Stockton, CA - City, police association reach deal to postpone layoff of 29 officers

The Record

"STOCKTON — The city and the Stockton Police Officers Association reached a deal late Wednesday to delay at least until June the layoff of 29 police officers, union officials said this morning.

The agreement –– which calls for police officers to forgo some $1.1 million in anticipated back pay and to surrender uniform allowances –– was a break in the bitter and long-lasting salary dispute between the union and City Hall and from ongoing negative announcements about the city’s worsening financial crisis."

Carlsbad,CA - City aims to cut pension costs

Union-Tribune (San Diego)

"CARLSBAD — The Carlsbad City Council is studying its employee pension plans with an eye toward possibly reducing the city's costs.

“The reason for this is the recession we're in right now,” City Manager Lisa Hildabrand said at a council workshop Tuesday. “One of the problems is the drop in the stock market.”

Hildabrand said the city's contribution to employee retirement benefits will increase this year by an amount to be determined in June.

Carlsbad participates in CalPERS – the California Public Employees'Retirement System – a state agency that pools investments of 2,500 public agencies and oversees pension benefits for 1.6 million public employees.

John Bartel, an actuary familiar with CalPERS, said some pension formulas encourage employees to retire at their most productive age."

Carson City, NV -Nevada worker unions, business lobbyists fight over benefits

Reno Gazette-Journal

"In a contentious legislative hearing Wednesday, labor unions seeking to protect public employee benefits from state lawmakers strapped for cash squared off with business lobbyists who have raised the cry for benefits reform.

The rising cost of state employee health and retirement benefits has become a major focus in the battle over the state's $2.3 billion budget shortfall."

Note from Ron York - Anjeanette is more objective and less emotional than Partick of the Las Vegas Sun is in his article - the one below this article. Read them both.


Carson City, NV - Chamber, unions clash on government pay, perks

Las Vegas Sun

"Carson City — The Las Vegas Chamber of Commerce is like the kid who taunts the barking, chained-up dogs in the neighborhood."

"David Kallas, representing the Police Protective Association, in a three-piece suit, his hair flecked with suspicious streaks of blond, oozed contempt."

“I’d like to pose a rhetorical question: Why are we here in the first place?” he said. Never has a special interest group like the Chamber of Commerce been allowed to dominate a policy process like this one, Kallas charged, although that seemed a little naive.


Note from Ron York - I was going to have my hair colored a little today when I get a haircut, but I do not think I will. Patrick might expose me. Seriously, this is a good article to read. It is more of an editorial than a news article, but it tells a lot about the emotions and dogmas that control this political battle in Nevada. As you read this article, keep in mind that the people at the chamber of commerce and the newspaper really believe what they are saying and promoting. We may like to see them as "evil capitalist", but they like to see us as "evil socialist." Both characterizations are not correct. This article will probably make many of you mad. I have to admit that it made my pulse rate go up. However, Patrick took a lot affect out of his writing by letting his teeth show. Read this article. It is well written and interesting.


San Bernardino, CA - Police union sues city leaders to block cutting of hours, pay

The Press-Enterprise

"The San Bernardino police union sued Wednesday to block city leaders from cutting officers' work hours and pay by 10 percent to help erase a budget deficit.

Union attorney Michael McGill said he'll seek a court hearing to argue for an injunction against the cut, scheduled to go into effect Sunday. City Attorney Jim Penman said the hearing is set for Monday.

Meanwhile, the police union discussed Wednesday a proposal to accept a package of budget concessions that could help avert a showdown with the city."

Wednesday, February 25, 2009

Bensalem, PA - Charity Basketball Game For Fallen Officer - Chris Jones










7:00 PM






Note from Ron York - Send them a check for Chris (A lot more than five dollars). Maybe tomorrow the bell will toll for you. Today, it tolls for Chris.


Sacramento, CA -City police union agrees to budget talks with city officials

Sacramento Bee

"The union that represents Sacramento's police officers has agreed to meet with city officials Thursday and hear their proposals for labor concessions designed to cut into a $50 million budget deficit.

So far, the police union is the only city labor group to agree to meet with city officials.

In a letter obtained by The Bee on Tuesday, police union boss Brent Meyer told city labor negotiators that while the union has no interest in reopening its entire contract, 'we believe that there are several viable options available to our respective organizations that could go far towards meeting the goals of each.'"

Note from Ron York - Notice that SPOA president Brent Meyer is called the "police union boss" in the third paragraph. It makes me imagine some fat guy with 5 o'clock shadow and a cigar from North Jersey. I do not believe Brent is anything like that. Just thought you would enjoy that little editorial slip.

Reno, NV - City might stop paying all employee pension costs

Reno Gazette Journal

"With state pension retirement costs rising this year for police and firefighters in Nevada, Reno officials said sharing that cost with employees will be put on the bargaining table when those contracts expire in June 2010.

Reno has been paying 100 percent of employee payments to the state retirement system, $30.1 million in fiscal year 2008-09.

Reno officials said a state law requires the city to pay 100 percent for police and firefighters. And over the years, that has been extended to other employees for fairness, City Manager Charles McNeely said."

Tuesday, February 24, 2009

Vallejo, CA - City Looks at Cutting Police, Raising Taxes


"VALLEJO, Calif. (KCBS) -- The city of Vallejo is bracing for more economic pain after filing for bankruptcy last year. Now, city officials are facing a huge budget shortfall that could further decimate services.
Listen KCBS’ Dave Padilla Reports

The budget gap is $12 million and Vallejo finance director Rob Stout says residents could see fewer cops on the street if that hole isn’t closed.

”We could lose 20 police officers, close a fire station or two, get rid of your economic development department,” said Stout. “We haven’t done any street maintenance, so some things have already been cut."

San Bernardino, CA - Cops still negotiating - Lawless is still the union president - Bildt is still the chief

Contra Costa News

"SAN BERNARDINO - Police are scheduled to vote tonight on a concessions proposal that could provide an alternative to furloughs.

'They gave me some stuff to take back to the membership,' said Rich Lawhead, president of the Police Officers Association. 'We have a membership meeting ... (tonight). We'll see what happens.'

Lawhead participated in a meeting that included interim City Manager Mark Weinberg Tuesday morning. Lawhead declined to reveal details of the new proposal.

City Hall officials and the police union have spent much of recent weeks arguing over concessions and budget cutting proposals as city leaders struggle to balance San Bernardino's recession-stricken budget."

New York, NY - The Great GASB

City Journal

"Last year, crippling pension and benefits costs caused the city of Vallejo, California to declare bankruptcy. In this year of compounded economic crisis, more towns and cities may follow Vallejo’s lead, pushed over the edge by an accounting and financial-reporting provision known as GASB (pronounced “gaz-bee”) 45. “It’s a perfect storm of pension liabilities hitting us at a time when the economy is tanking and revenues are tanking,” says David Edwards, the senior policy advisor to Atlanta’s mayor. “It’s unprecedented.”"

Note from Ron York - I post this article for your entertainment. There are a thousand others just like this. GASB 45 is an accounting rule covering "Other Post Employment Benefits" (OPEB). Its real target is retiree's health insurance. First, the Governmental Accounting Standards Board is only a body that sets rules for presentation. It has no enforcement powers. Below are a list of relevant facts concerning GASB 45 (The XI Commandment).

1- GASB 45 only requires that the accrual impact of these OPEB items be incorporated into the Government Wide Financial Statements. Besides me and a few other geeks at the rating agencies, nobody takes the time to read them, or even understands them, at least anyone who matters. (Graduate students studying for PHDs do not count.)

2 - There is nothing new being disclosed. The same information has been disclosed in the footnotes to the financial statements for years. Unless the three bond rating companies are bunch of idiots, there is nothing new here for them either Unfortunately, the bond rating agencies have been "painting by the numbers" for years. This is part of the problem with the credit crisis.

3 - Every government has this liability. Unless the bond rating agencies want to admit that they have been duped by a bunch of amateurs, they have very little ground to stand on.

4 - Pre-funding OPEB is an economic mistake. Is there anyone out there with a real degree in economics? Or is it all just a bunch of lawyers, journalist and political scientist? I am not going to waste any time going into this. It is like going back to the stone age and trying to debunk flat earth theory.

5 - The threat of having your bond rating going from "AAA" to "zzz" is ridiculous. If that occurs, then we need to trash the current rating system. That might be good idea anyway. The bond rating companies have long since concerned themselves with economic reality, but have gone the way of lawyers and accountants, where reality is ink on paper - legal positivism.

That's enough pontification for today. Man, that felt good.

Jamestown, NY - Police Contract Passes


"City police officers will get a 3 percent increase in wages this year and another 3 percent increase on wages they earned last year under a new contract approved Monday night by the Jamestown City Council.

Council members voted 5 to 3 in favor of a new contract with the Kendall Club Police Benevolent Association, the union that represents the city's police officers. City Councilman Steve Szwejbka, D-Ward 1, abstained from voting and did not participate in discussion on the matter, as he is a retired member of the city's police force.

Voting against the new contract were Greg Rabb, D-At Large and council president; Vince DeJoy, D-Ward 4; and Maria Jones, D-Ward 5."

Case-Shiller - Housing Prices Continue To Decline


Standard and Poor's Case-Shiller Index for December was released yesterday. All twenty cities in the index reported a decline. The current boom-bust cycle in real estate began in 2003 for most places. The chart above shows how prices compare today in the twenty cities with prices in 2003. The bars going to the left represent cities that now have lower prices than in 2003. Those to right have higher prices today. Only two cities have any large downside risk left - Seattle and Portland. New York City and Charlotte may have more speculation premium to eat.

The table above shows housing prices in Phoenix since 1988. The red line represents the long-term trend prior to the 2003 boom. Notice that Phoenix is now below the the trend line. There will be over-correction in most of the major cities in the West.

I believe we are at or near the bottom. What makes me think that? Well, just like the Robin tells us spring is near, real estate has its signal also. We are now seeing "bottom fishermen" moving back into the market. This is a different breed of cat than those who drove the boom. They are not go-go boys wearing Guccis and driving BMWs. These guys are tight wads who would not spring for a pair of Guccis. They're back and they're buying - laying low and buying low. Oh, one other thing, these guys have cash - a lot of cash.

Listened to the news lately or read the Wall Street Journal? Pretty depressing isn't it? Hey buddy, can you lend me a dime? Hey buddy, ya wanta buy an apple? Real gloom and doom, right? Wrong, it is all being written and spoken in a secret code. I have the key to the secret code. So, what is the market telling us? BUY - BUY - BUY. (Sorry Cramer. I know that's your line.)

Get yourself a used Crown Victoria sedan (white) and put on your Levi's, your hiking boots and an inexpensive shirt and begin cruising. Start making low ball offers on properties with desperate sellers. Just ignore the real estate brokers and go straight to the owners. If they have to pay a realtor, who cares. What you do not want is to have the broker working as a firewall against low offers.

If you want to make money speculating on real estate, you have to bay now.

Warwick, RI - Unions agree to key budget concessions

The Providence Journal

"WARWICK — Mayor Scott Avedisian yesterday announced that three city unions — police, fire and municipal workers –– have tentatively agreed to wage and benefits concessions that he said would enable the city to weather Governor Carcieri’s proposed cut in local aid this year and save the city millions more over the next three years.

Avedisian said that some of the concessions, such as forgoing contractual raises for the four months remaining in the current fiscal year and increasing employees’ share of health insurance premiums, will go into effect March 1 if the agreements are approved by the City Council."

New York, NY - Bloomberg May Go After 20 Year Pension For NYPD and FDNY

The Gothamist

"With the grim state of the city budget a hot topic these days, questions are being raised about how long we can continue to sustain the heavy financial burden that comes from the city's pension system for municipal retirees. Last year the city paid out a total of 9% of its budget ($5.6 billion total) for its pensions and analysts project that percentage is only expected to rise. Former NYPD officer and current State Senator Martin Golden told the Post, 'Everything's got to be explored...The bottom line is everything's on the table.'

What Mayor Bloomberg and Governor Paterson would specifically like on the table is the '20-and-out' retirement plan for municipal workers. Bloomberg said, 'Right now, we are paying full retirement benefits to people in their 40s. As people are living longer, we simply can't afford to do it forever.' The more than 10,000 retired cops under the age of 50 represent 25% of the city's police-pension liability."

Monday, February 23, 2009

Columbus, OH - City Working To Save Police Recruits


"COLUMBUS, Ohio — The city may be a step closer to saving its 27-member police recruit class, 10TV News reported Sunday.

Sources within City Hall and the police department said President Barack Obama is very interested in saving the class and Columbus is near the top of the list for stimulus money, 10TV's Kevin Landers reported.

Sources told 10TV News that it was not an accident that Obama mentioned Columbus' recruit class in two recent speeches. They said it seems that the president wants to use the police class as an example of the positive things that stimulus money can be used for, Landers reported."


Daily Policy Digest

"California may still seem to be the dreamy land of movie stars and swimming pools, beautiful beaches and endless summer. But the reality -- and perhaps the future -- of the nation's largest state looks gritty, where past extravagance has collided with economic recession and the collapse of home values to push it into bankruptcy, says USA Today.

The state stepped away from the brink of financial ruin when the state Legislature ended months of deadlock and paralysis -- which had shut down road projects and held up tax refund checks -- by agreeing to a budget plan that increases taxes, cuts spending and borrows money to plug a $42 billion deficit by mid-2010."

Omaha, NE - Police Union Claims Ad Campaign Not Political


"OMAHA, Neb. -- The Omaha Police Officers Association kicked off an ad campaign claiming the association is committed to working with the city to solve the problem of police pension spiking.

The campaign comes just days after the association criticized two City Council candidates for their votes on how police can monitor sex offenders.

But association President Aaron Hanson insists there's no political angle to the campaign."

Sunday, February 22, 2009

San Diego, CA - Mayor Sanders pursues benefit, pay cuts

The Union Tribune

"SAN DIEGO — In his most pointed remarks since union contract negotiations began this month, Mayor Jerry Sanders said yesterday he wants to solve San Diego's budget problems almost entirely at the bargaining table.

“Our city's path forward is no secret,” he told 150 people at a City Council budget forum in City Heights. “To close this year's deficit, we need to reduce compensation and benefits or make drastic service cuts.”

The comments didn't catch labor leaders by surprise or change their minds.

“The mayor wants concessions. He needs to start,” said Damian Tryon, a spokesman for the city's 1,800-member blue-collar workers union.

Tough talk is nothing new at negotiation time, but circumstances are different now with a global recession and Sanders' stated intention “to finish the job of reforming our pension system and reducing our retirement costs.”"

Long Beach, CA - A hard bargain for LB unions

Contra Costa Times

"LONG BEACH - As Long Beach city officials prepare to begin negotiations for a new contract with the Long Beach Police Officers Association, the city is facing tough financial times that could make reaching consensus a challenge.

In 2005, the city and its police association agreed to a 21percent pay hike for police officers over the four-year term of the contract, as well as a guarantee that Long Beach police would reach the median pay for officers in the state's 10 largest cities by the time the contract expires Sept. 30 this year.

That was then, this is now.

After already cutting $16.9million from the city's $404million general fund budget at the beginning of the fiscal year, Long Beach is facing another $15.7million deficit and is planning more cuts. Low sales tax revenues, vehicles license fees and oil revenues all are to blame for the revenue shortfall."

San Diego, CA - Tsunami Comes Ashore (and not at Crescent City)

The Union-Tribune

"I watch a show with my son called “Fireman Sam.” It's about a heroic firefighter named, well, Sam. He dashes into burning buildings and saves people. My kid loves it.

I watch it and wonder how much Fireman Sam will someday bring home under his pension.

Does his town have a DROP program? After 30 years of service, will he get an obscene amount of money, while I'm stuck working until I'm 91?

I can't help but think that way. My 401(k) is tanking, and I've got a case of pension envy."

Note from Ron York: This Tsunami situation has gotten out of control. Here in Norman, we have the largest meteorological center on the planet. They have been working diligently to find this new source of Tsunami's. The best they can offer is that it is all coming from some guy's garage in Fullerton, California. I suspect that garage belongs to my unrepentant friend, Jack Dean. Jack operates a web site called Pension Watch and puts out a daily news service on public pensions. It is called Pension Tsunami. Before you get all excited, I must tell you that he is not the local branch of the FOP or the IAFF. He works the other side of the street, but he is an honorable opponent and a straight shooter. You just do not want to get shot by Jack and his band of Libertarians. You can learn more about Jack and his work by going to his web site Pension Watch You can receive his newsletter. I get it every day and count it as a valuable resource. Jack occasionally sends me emails pointing out the errors of my ways. I accept it as just criticism from an honest broker. Jack never sleeps. Neither do I.


Saturday, February 21, 2009

Uniontown, PA - Firefighters union files lawsuit over layoffs


"The union representing Uniontown's firefighters has filed a lawsuit seeking to force the city to reinstate the laid off firemen until a grievance over the furloughs is settled.

Uniontown City Council laid off three firemen and 28 other employees in October and four more firefighters, along with six other employees, last week to reduce expenses.

The layoffs have left the fire department with six firefighters. Interim chief Chuck Coldren said two men will work each of the three shifts at the Central Fire Station and the East End Fire Station would be closed because of the lack of manpower."

Huntington, WV - Getting Rich In West Virginia (Yes, California, these are real amounts)

The Herald-Dispatch

"HUNTINGTON -- The salaries of several Huntington Police officers were boosted with overtime pay in 2008, but Police Chief Skip Holbrook says the days of soaring overtime costs are long gone because of new departmental procedures.

Overtime pay propelled the pay of 28 officers -- about a third of the Police Department -- above Holbrook's $57,000 salary in 2008, while 18 made more than former Mayor David Felinton's $62,000 salary, according to a list of employee earnings that the city released earlier this week."

San Bernardino, CA - officials, police union may reopen talks on spending cuts

The Press-Enterprise

"San Bernardino city officials and the police union may reopen negotiations Monday over police department spending cuts, possibly averting a lawsuit over forced officer furloughs, the union's attorney and city officials said.

'There's an ebb and a flow to any negotiation process,' said interim City Manager Mark Weinberg. 'Certainly we had gotten to the point of apparent impasse, but the message I got from the (union's) attorney today is that they would like to resume negotiations.'"

Escondido, CA - Strife with unions worsening city's money problems

North County Times

"ESCONDIDO ---- Labor unions representing Escondido firefighters and police officers have repeatedly balked this winter at city requests for voluntary compensation cuts, complicating efforts to balance the city's budget as revenues continue to decline.

Efforts to reach agreements have been so unsuccessful that city officials have declared impasses with both unions, triggering City Council hearings where city staff members and union officials will air their grievances in public.

The hearing for the firefighters union is slated for next Wednesday, while the police officers union hearing is scheduled for March 18."

Friday, February 20, 2009

Vallejo, CA - IAFF Staffing Grievance Denied Without Prejudice

By Marc Garman
Vallejo Independent Bulletin

An effort by IAFF (International Association of Firefighters) 1186 to force Vallejo to comply with staffing levels set forth in the contracts and be subject to prior arbitration awards, has been denied without prejudice in a tentative ruling. Of course, this is a tentative ruling, so we still have to wait for a final ruling...but any change is very rare. This represents a big loss for IAFF and also renders Binding Arbitration clearly moot during the bankruptcy proceeding. We'll have more analysis on this going forward.

Vallejo, CA - Orrick (Marc Levinson) Argues for Vallejo Bankruptcy


Orrick Argues for Vallejo Bankruptcy: "With California's economic and budget woes capturing headlines this week, a three-judge panel of the 9th Circuit Court of Appeals heard arguments Thursday in Pasadena over one city's eligibility for bankruptcy protection. Orrick, Herrington & Sutcliffe's Marc Levinson, who represents the City of Vallejo, says he feels pretty good about his performance, but that the judges hinted that they could remand the case to the 9th Circuit even if they affirm Vallejo's eligibility for bankruptcy protection.

I hate the thought that we'll still be stuck worrying about eligibility instead of dealing with the issues in the bankruptcy, but I can see the handwriting on the wall, says Levinson."

Panama Ciy, FL - Police approve Teamster representation

The News Herald

Police approve Teamster representation - The News Herald: "PANAMA CITY BEACH — Officers and investigators of the Panama City Police Department voted overwhelmingly in favor of union representation Thursday, Bay County officials said.

Out of 63 votes cast, 46 were in favor of seeking collective bargaining representation. The question police were asked, was whether they wanted the Teamsters and other unions 'to represent you as a collective bargaining agent,' according to Bay County Supervisor of Elections Mark Andersen."

San Bernardino, CA - City Council Approves 55 Layoffs

The Black Voice News

Black Voice News Online - San Bernardino Approves 55 Layoffs: "Droves of police officers assembled on the

steps of San Bernardino City Hall and later during the public council session to protest against potential layoffs or furloughs.

By close of the five hour session members of the City Council voted 4-1 Tuesday night to approve a budget that spared police and firefighters and directed staff to deliver pinkslips to 55 city employees. Park maintenance workers will take the brunt of the cuts.

The move came days after police rejected a 10 percent pay cut and other concessions.

“Cutting officers would reverse recent successes in reducing crime,” argued Sgt. Rich Lawhead, president of the San Bernardino Police Officers Association."

Las Vegas, NV - How does the Nevada Highway Patrol’s staffing compare with other states’?

By Mr. Sun
Las Vegas Sun

How does the Nevada Highway Patrol’s staffing compare with other states’? - Las Vegas Sun: "Mr. Sun, I’m from California and I used to see a lot more California Highway Patrol officers on the freeways there than I do here. How does the Nevada Highway Patrol’s staffing compare with other states’? — T. Wayne"

San Bernardino, CA - City council votes to impose furloughs on police

The Press-Enterprise

"A divided San Bernardino City Council voted to order police officers Thursday to take furloughs equal to a 10 percent pay cut despite a union threat to sue.

'We've tried our best to reach a negotiated agreement,' Mayor Pat Morris said. 'This decision has the highest merit of the bad choices put before us.'

Morris said city leaders, struggling to fill a $9 million budget gap on their $150 million general fund by the end of the fiscal year, had to cut their biggest expense, employee pay and benefits."

Thursday, February 19, 2009

Tulsa, OK - Police union wins in contract arbitration

The Tulsa World

"Tulsa’s police union has prevailed over the city in its contract demands, receiving 3 percent across-the-board raises retroactive to Jan. 1.

An independent arbitration panel made the ruling Thursday, ending nearly a year of negotiations.

The city is also going to pay about $700,000 more for the year into the police union’s health trust.

The panel also decided that all police can continue driving their patrol cars home within a 25-mile radius of 41st Street and Yale Avenue."

San Bernardino, CA - Talks between police union yield no deal

The Press-Enterprise

"The San Bernardino city manager and the police union were unable to reach an agreement on contract renegotiations after meeting for several hours Wednesday night.

The union offered about $3.3 million in benefit cuts to ease the city's budget crisis, said union attorney Dieter Dammeier.

Interim City Manager Mark Weinberg acknowledged that the union was willing to make enough financial concessions, but the union made demands that didn't require money, which the city would not agree to."

El Monte, CA - It's paycuts or possible layoffs for El Monte police

San Gabriel Tribune

"EL MONTE - Pink slips will be sent to 17 police officers whose union has not accepted a 10-percent pay cut, officials said Wednesday.

Other El Monte employees avoided a similar fate after two of the city's four employee unions agreed to take the proposed pay cuts.

The cuts are intended to help close the city's growing budget deficit during the current fiscal year, which ends June 30, El Monte city spokesman Matt Weintraub said.

The pay cuts also will begin to address potential shortfalls next fiscal year."

Wednesday, February 18, 2009

Vallejo, CA - Council to decide city manager's fate

Vallejo Times-Herald

"Vallejo leaders will have to decide by the end of this month whether to extend the city manager's tenure, Mayor Osby Davis said Tuesday.

City Manager Joe Tanner's contract, which runs through 2010, will automatically renew for another year if the City Council does not provide a year's notice otherwise, the contract reads.

Tanner's contract will be a topic of discussion at a council meeting Tuesday, Davis said."

Denver, CO -Labor pushing changes at Capitol

The Denver Post

"Emboldened by Democratic control of the Capitol, labor interests this year are pushing for sweeping legislative changes and trying to regain ground lost during GOP-controlled eras.

Police and firefighters throughout Colorado may be able to unionize. State contractors may have to pay higher wages. And employers could be punished financially for locking out union employees."

Vallejo, CA - Bankruptcy Appeal Hearing 10:45 A.M. Thursday In Pasadena

Vallejo Times-Herald

"Nearly nine months of bankruptcy court work could be nullified after Thursday, when a panel of judges will consider the validity of Vallejo's Chapter 9 petition.

A three-member panel of the 9th Circuit Court of Appeals will hear oral arguments on the issue at 10:45 a.m. Thursday in Pasadena."

Note From Ron York: When we receive any important information on this hearing we will immediately post it. We have access the Federal Courts PACER System, but it is normally one to two days behind. For the most part, we will have to wait for Jessica to publish an article in the Times-Herald. In addition, we have other sources that may provide us with information. If Marc Garman of the VIB attends the telecast in Sacramento, he will most likely post his article on the VIB. If and when he does, we will put up a link to it. This drama is very important to all us that are involved in public safety collective bargaining and city admininstrations, but to the general public there is little interest, except for the people out there in Vallejo. Hopefully, this saga will be over soon - it may not. We can then focus on other cities and other areas of the country.

Monday, February 16, 2009

Newark, NJ -: More police unions turning to arbitration

North Jersey Crime Examiner

"More and more, police unions around the state who are upset with towns that have taken a hard line in negotiations are turning to arbitration.

Yet while municipal officials insist the process favors their town's finest, raising their local budgets, police unions say it's their only recourse when town fathers (and mothers) won't budge.

Money is tight, everywhere, both sides acknowledge. But there has to be a way to find a deal that satisfies everyone."

Sunday, February 15, 2009

Hobbs, NM - Police agree to 3-year contract

El Paso, TX

"HOBBS, N.M. (AP) - The city of Hobbs and the police department's union have agreed after almost a year of negotiations to a 3-year contract that includes pay raises.

Union president Jeff Moyers says the contract is a relief.

City commissioners approved the contract during a recent meeting. It's effective through Jan. 15, 2012.

In the first year, the contract calls for a 3% pay increase on hourly wages for union members. The city will contribute an additional 3% to employee retirement and will pay an overtime rate equivalent to time and one half the employee's regular hourly pay for hours worked above 80 during a pay period.

The second and third years also include a 3% pay increase on hourly wages and a 2% contribution by the city to employee retirement."

Sioux Falls, SD - Poor economy doesn't hinder city pay raises

Argus Leader

"Private companies in South Dakota shed about 3,600 jobs in the second half of 2008, and many more workers endured unpaid furloughs or cuts in pay and benefits.

Gov. Mike Rounds at first cut raises for state workers to 1.5 percent for the next year and then eliminated increases altogether as the recession took hold and revenues continued to slide.

In Sioux Falls, however, city employees are in line for a wage bump starting at 3 percent, with most receiving merit increases that could run that figure as high as 9 percent. The city also has plans to add 20 employees this year, which would push the number of municipal employees beyond the 1,100 mark."

Toledo, OH - Citizens raising money to save the police department

The Toledo Blade

Concerned that Toledo police layoffs are again being considered, a local businessman is ramping up efforts to raise money through donations and fund-raisers to hire cadets and firefighters.

Toledo resident Jim Wheeler, territory manager for Seneca Medical, said his nonprofit organization called Feet on the Street has so far raised $20,000 and attracted 50 to 75 supporters.


Toledo, OH - Baraining With Fear

The Toledo Blade

"POLICE and fire protection are very important and must be maintained at levels adequate to keep residents safe. But suggesting that people will flee Toledo, never to return, if police staffing needs are not immediately addressed goes well beyond the posturing one expects from a union official trying to save jobs. It crosses into the realm of fear-mongering.

That is what Dan Wagner, president of the Toledo Police Patrolman's Association, did when he called this year's expected decline in police ranks from 634 to about 600 an 'unprecedented public safety crisis' and warned of dire consequences."

Saturday, February 14, 2009

Chillicothe, OH - Police Officers' union to take talks to binding arbitration

Chillicothe Gazette

"The union representing Chillicothe police officers plans to take union negotiations to binding arbitration to settle a three-year contract for 2009 through 2011 that hasn't yet been settled.

Chillicothe City Council members accepted a fact- finder's report which ruled only on two issues currently in dispute between the city and the Fraternal Order of Police, the union represnting the 52 officers in the city."

The Worst Economy In 50 Years - Caused By The Worst Person In The Whole World - George W. Bush

Actual Annual GDP Per Capita Restated In 2008 Dollars

Real GDP Per Capita Percentage Change From Previous Quarter

Boy, am I glad to say good riddance to you - 2008. I did everything I could to talk you up and support you, but in the end you broke my heart. Just when I became fully invested in you, you left me to face all of my detractors.

Okay students, it is test time. What was the worst economic year in the United States since 1929? I can think of a few candidates – 2008, 1992, or maybe 1974. What was the best year? Psst!! Let me give some help – think Clinton years. I have Charles and Matt doing the research and I will include it in this blog as soon as they give it to me. Hurry up guys, everyone is waiting. Boy that George W. Bush was really a loser. He caused us to suffer through eight years of economic depression – worst economy in fifty years. Oh well, those days are over and we can begin the long climb back to the glory days of the Clinton administration.

Here, I have got the results - 1933 was the worst year and 2008 was the best. Now you have it.

The Ten Best and The Ten Worst Economic Years In The United States

Real GDP Per Capita (2000 Dollars)












George W. Bush




Herbert Hoover




George W. Bush




Franklin Roosevelt




George W. Bush




Franklin Roosevelt




George W. Bush




Franklin Roosevelt




George W. Bush




Herbert Hoover




George W. Bush




Franklin Roosevelt




George W. Bush




Herbert Hoover




William J. Clinton




Franklin Roosevelt




George W. Bush




Herbert Hoover




William J. Clinton




Franklin Roosevelt

Hey, wait just a minute. This cannot be right. I smell Karl Rove. This is just the kind of thing he is good at – lies and deceptions. Believe me these numbers are wrong and how do I know that? Well, I was watching Keith Olbermann the other evening and he was telling me how bad the last eight years have been under the despot George W. Bush. I trust Keith. Anyone who hates George Bush, Karl Rove, and Bill O’Reilly has to know what he is talking about. He has his hate prioritized.

This is all very funny, but on a year-by-year comparison, 2008 was the greatest year ever. 2009 will probably not reach number one, but I betting that it will be 3rd or 4th.

This is all I have time for now. Until I publish the Business Cycle Newsletter this will have to do. I hope to have it out by the end of the month. By then, I should have all data for 2008, including Case-Shiller.

In the meantime, you can check my facts by going to the Bureau of Economic Analysis website.

My email is