Department Managers to Pay More for Their Pensions

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As the Costa Mesa City Council Tuesday approved nearly a million dollars in unforeseen legal costs due mostly to its outsourcing efforts, it also quickly saved thousands of dollars in just a few minutes of discussion by negotiating with its managers on pension costs.

However, a similar deal with rank-and-file employees – with savings potentially in the millions – is unlikely anytime soon.

Tuesday night’s City Council meeting featured more back-and-forth accusations between council members and the public over the role of unions in Costa Mesa, the council majority’s outsourcing efforts and the expensive costs of outsourcing-related lawsuits.

Up for approval was $900,000 in unexpected legal expenses, mostly tied to its hiring of the high-priced law firm Jones Day for lawsuits related to the city’s outsourcing efforts.

The main suit has cost taxpayers more than half a million dollars as of January, the most recent month figures are available.

But in the midst of the acrimony, the council was able to authorize in less than three minutes a cost-saving measure involving employee retirement benefits that was met with support from its usual critics.

Following in the footsteps of top city executives, six Costa Mesa department managers agreed to pay nearly a quarter more into their pensions, from 31.5 percent of their pension costs to 39 percent, the maximum amount the city says is allowed by law.

The change is expected to save the city $35,000 per year and gained the support of the council’s dissident member, Wendy Leece.

“I think this is obviously a step in the right direction,” said Councilman Steve Mensinger. “Hats off to them.”

The measure offers a glimpse at what many experts agree is the most realistic way to cut down on a city’s share of its pension bill: to have employees pay more into their retirement benefits.

Pension costs are one of the top two fiscal concerns mentioned by the council majority, though its approach to the issue last year appears to have prevented any negotiations to lower costs further, at least for the time being.

Citing pension costs and a perceived fiscal emergency, the council decided last March to hand out layoff notices to nearly half of its rank-and-file staff.

The employees continue to face the prospect of losing their job as part of the outsourcing efforts, and union leaders say they won’t sit down to the negotiating table as long as the pink slips are in effect. Thus any deals with rank-and-file employees are highly unlikely in the foreseeable future.

The managers’ pension contribution issue was one of the few calm moments in an otherwise highly charged and contentious meeting Tuesday night.

Costa Mesa has been mired in intense political conflict since the council majority started pursuing its unprecedented plan last year to remake city government, largely by outsourcing its services to the private sector.

That mutual distrust was on display even more than usual on Tuesday, with the council majority and many city residents trading accusations of ulterior motives and asserting that one another is backed by special interest groups.

“There continues to be rather vehement comments from the dais about the unions being behind all this … opposition to what the city is doing,” said Perry Valentine, a former city administrator who said he hasn’t been involved in a union since the 1970s.

“I really object to that. I think it’s an attempt to divert attention from the real issues and to trivialize the opinions of people that happen to differ from the opinions of the City Council.”

Valentine added that he and and most of the people he’s talked to who oppose the council’s efforts “are not in any way affiliated with a union.” Judging by the council majority’s campaign contributions, he said, one could argue city leaders are “in the pocket” of the law firm Jones Day, as well as apartment and building trade groups.

Mayor Pro Tem Jim Righeimer took issue with Valentine’s assessment regarding unions, pointing to previous campaign contributions from labor organizations, including police unions in North Orange County, to a political action group in Costa Mesa’s last City Council election.

“In the end, these organizations go out and get put together as grass-roots, and most of the people involved in the city think they’re grass-roots. But in the end when the mailer goes out … it will be funded by labor organizations.”

However, the leaders of Costa Mesans for Responsible Government, the main group now opposing the council majority, have repeatedly vowed that they take no money from unions and don’t plan on doing so.

“The organization you quoted has not been the organization that has been contending this charter,” said Harold Weitzberg, a representative of the citizens’ group, referring the the council majority’s push for a city charter that would allow large-scale outsourcing.

“We are a grass-roots organization, and we have not taken any money from unions,” he added. “We should argue the facts and not bring up things that are incorrect.”

Several residents also took issue with an analogy Righeimer used to illustrate his perspective that unions were trying to “take over” the city charter process.

”The citizens of Costa Mesa have decided they no longer want to be on the plantation. They’re leaving the plantation,” said Righeimer.

“I mean, come on,” Weitzberg said later. “Plantation owners were paternalistic people who felt they had to read everything to their slaves and show them the right way through their guidance. … Certainly that is not the group that is fighting against the charter.”

— NICK GERDA

 

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