With Orange County supervisors scheduled this week to appoint Lisa Bartlett as the board’s first female chairperson in a half dozen years, there already appear to be some old boy network issues arising to confront her.
The main political plumb provided in the past to board chairs has been the task of making appointments to regional agencies – such as the lucrative Air Quality Management District and proposing countywide board appointments – such as the powerful Orange County Employees Retirement System (OCERS).
Bartlett – who has yet to be formally voted in – has apparently already lost that power.
The OCERS slot is particularly interesting given that Orange County’s conservative Lincoln Club – and their president Wayne Lindholm (the current appointee and ultimate old boy) – stood against Bartlett in her 2014 supervisors’ election backing instead then-Laguna Niguel Mayor Robert Ming.
Ming and Lindholm’s wife, Linda, were colleagues at the time on the Laguna Niguel City Council.
Appointments are among the most direct impacts from elections, especially at the local level.
Bartlett was reportedly moving to suggest Mission Viejo Councilman Frank Ury – who also ran for supervisor in 2014 but backed her after coming in third during the primary – for the OCERS board slot.
Stanton City Councilman Dave Shawver – who has been vocal that the OCERS board should have more representation from cities that contract with the county for law enforcement – also was reportedly seeking the seat.
Yet Supervisor Andrew Do reportedly swooped in on Friday and formally proposed keeping Lindholm.
Do – who is running for reelection this year and is presumably looking for Lincoln Club support against a potential Democratic challenger from Santa Ana (Councilman Vince Sarmiento?) – has agendized a vote to reappoint Lindholm to another three-year term to OCERS.
That move would apparently buck past practice — with former chairs proposing the OCERS appointment and the full board ratifying.
Lindholm was last appointed in 2013 during the chairmanship of Supervisor Shawn Nelson.
Neither Bartlett, nor Do, nor Lindholm returned my calls for comment late last week with things reportedly tense on the fifth floor of the Hall of Administration over the issue.
Should provide some good drama on Tuesday.
There have even been some rumblings that Bartlett could be blocked from the board’s top slot, with current Chairman Todd Spitzer attempting to retain the chairmanship for another year — a rarity that last happened to Supervisor Shawn Nelson a few years ago (another female supervisor – Pat Bates – was passed over that year).
Spitzer this week is returning from a family vacation and has not been available for comment.
Bartlett is reportedly trading the Lindholm appointment to hold on to her position as chair.
Lindholm has been controversial on the retirement board since he was appointed.
He has largely led a majority contingent on the OCERS board voting for more conservative investment return assumptions at every opportunity regarding the county’s large unfunded liability for public sector pensions.
That has triggered significant tension with public sector labor leaders – especially in public safety – who argue that Lindholm’s logic costs taxpayers more, not because it’s necessary but because its become an ideological sport in Orange County like no other place in the state.
Many labor leaders argue that OCERS investments have performed well throughout the decade, even with the Great Recession.
Yet Lindholm and many Republican supporters argue that investment returns are in a historic slump and could get worse. The only way to make up the difference on the unfunded liability is to pump cash into the system.
That logic means employers like the county and their employees would have to keep kicking in more money to fund their pension benefits.
Lindholm and county supervisors like Nelson argue that’s necessary and fair because of the concept of intergenerational equity – meaning the current generation of workers doesn’t kick pension debt to their children.
“The people who are closest to retirement want us to take the biggest bite (into the unfunded liability) later, after they retire,” Nelson argues.
Nelson notes that solid investment gurus like Warren Buffet argue that the investment return assumptions public sector pensions should be significantly lower.
“Warren Buffet, a Democrat who I think should be trusted, says that anything over six percent (assumption on investment returns) is dangerous,” Nelson said. “Forget Wayne and everybody on the board as far as I’m concerned. I think Buffet should be listened to: Anything over six percent is a bad idea.”
Last week, Republican Party Chairman Fred Whitaker sent out an email to the party ranks calling for a full-court press on Lindholm.
“Wayne’s appointment is up for renewal next Tuesday and the public employee unions are pushing hard to remove him from the board. Through his efforts he has helped save the county $1 Billion by changing the amortization and paying down unfunded liabilities!” Whitaker wrote.
He continued: “[Do] has courageously placed an item on the Board of Supervisors agenda next week to renew Wayne’s appointment for another 3 years. We need your help in contacting each of the County Supervisors and urging them to support Supervisor Do’s item to reappoint Wayne as the solid conservative voice on the OCERS Board.”
Yet adjusting assumptions on things like investments and worker life spans costs more now – and it impacts public safety more than most because of the size of pension benefits for deputies and the fact that many Orange County cities contract with those services through the Sheriff’s Department.
Most public safety union officials warn elected officials that to move toward more conservative assumptions on pensions threatens public safety.
“Reappointing Wayne Lindholm to the OCERS Board of Retirement is akin to appointing the fox to guard the henhouse. The only representation Orange County contract cities have on the OCERS board is when they write the checks to pay for the increased costs Lindholm and the Lincoln Club championed,” said Tom Dominguez, president of the Association of Orange County Deputy Sheriffs.
“It’s easy to vote under a warped facade of “fiscal conservatism” to increase costs deliberately and unnecessarily to the taxpayers when you aren’t the one footing the bill,” Dominguez said. “By day Lindholm claims to be a champion of OCERS retirees by carrying out his duty as a trustee to protect the retirement system. But by night Lindholm and his old guard Lincoln Club patiently work to destroy the very system he is sworn to protect, a system that thousands of deputy sheriffs, firefighters and retirees depend on. It’s time for fiscally responsible appointees on the OCERS Board.”
Yet politics is often all smoke and mirrors.
And when it comes to pensions, there’s plenty of that in OC.
A few years back, when supervisors gave deputies a pay raise to offset their new commitment to pay into their pensions, people like Lindholm went silent while elected officials like Nelson protested that action calling it fake conservatism.
That was the same cycle when Lindholm’s wife, Linda, ran as a fiscal conservative to the county board of education.
Even when Nelson – who recently got his own controversial government pension – is asked about the budget earthquake that would occur for government services should the OCERS investment assumption be placed at six percent as he suggests, he backs up immediately saying the number is only for arguments sake.
Correction:A previous version of this story identified Wayne Lindholm as the nominee of former Supervisor John Moorlach. We regret the error.