Mountain Views News, Pasadena Edition [Sierra Madre] Saturday, October 20, 2018

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SOUTH PASADENA - SAN MARINO

Mountain Views-News Saturday, Octorber 20, 2018 

FAQs on South Pasadena Budget and Spending

Input Needed for 
Transporation Survey

 

 Measure N on the November 
6, ballot will ask voters in South 
Pasadena to repeal the City’s 
Utility Users Tax. A “yes” vote 
on Measure N is to eliminate the 
tax; a “no” vote is to retain it. A 
repeal of the tax would cut $3.4 
million from the City budget 
and force significant service 
cuts and layoffs in nearly all City 
departments, as indicated in 
previous fiscal impact analysis. 
Measure N has raised questions 
in the community about 
the South Pasadena budget 
and spending priorities. The 
following FAQs are intended as 
information to address those 
questions.

Has the City’s general fund 
spending increased in recent 
years?

 Yes. In 2011, the City Council 
made a strategic decision to 
increase its investments in 
critical infrastructure such 
as street repairs by spending 
some of its reserves for this 
purpose. The City’s general fund 
has indeed seen a cumulative 
increase of $4.4 million due 
to an increase of $3 million 
in property tax revenue, and 
increases in sales taxes and 
service fees, in the seven-year 
period following 2011. The 
City’s spending increased by a 
cumulative total of $9.5 million 
over the same seven years, which 
included spending reserves 
for the purpose of investing 
in critical infrastructure 
improvements that reflected 
strong community demand for 
street repairs and maintenance.

 In 2011, the City Council made 
a commitment to improving, 
rehabilitating, and replacing 
its aging infrastructure. At that 
time, the overall street condition 
in the City was measured with a 
very low Pavement Condition 
Index (PCI) score of 61 (on a 
100 point scale). The backlog 
of street repairs citywide was 
estimated at $60 million.

 Beginning in FY 2012-13, 
annual appropriations for street 
and sidewalk improvements 
averaged $2 million a year from 
General Fund reserves. In total, 
the City has spent over $11 
million to fund street projects 
out of the City’s General Fund 
since FY 2012-13. The additional 
General Fund spending was 
the direct result of these 
infrastructure investments.

Did the spending increase 
due to employee salaries and 
benefits?

 No. Increased spending 
between 2011 and 2018 was 
because of transparent and 
strategic decisions to invest in 
infrastructure projects -- not 
to pay or enhance employee 
salaries and benefits. 

 In fact, South Pasadena 
employee salaries and benefits 
have been and continue to be 
among the lowest in Southern 
California.

 A recent survey showed that 
South Pasadena salaries fall 
below the median salary of 
adjacent cities. The median 
annual salary for all full-time 
employees is $68,184. The 
City did not increase wages 
or provide a Cost of Living 
Adjustment (COLA) as part of 
the approved labor contracts for 
2018 and 2019.

 Further, a survey conducted 
in 2017 indicated that South 
Pasadena employees receive 
among the lowest total benefits 
for medical, dental and vision 
insurance when compared to 
other public agencies in the 
region.

 The City offers the lowest 
retirement formula permitted by 
CalPERS. For classic members, 
the City offers the lowest of 
six retirement formulas for 
miscellaneous employees (2% 
@ 55) and the lowest of eight 
retirement formulas for public 
safety employees (2% @ 50). 
Over the years, this results in 
significantly lower financial 
liabilities for the City when 
compared to many neighboring 
cities that offer higher retirement 
formulas. By comparison, 
the industry standard is 2.5% 
for miscellaneous employees 
and 3% at 50 for public safety 
employees. Some cities pay 
as high as 2.7% at 55 for 
miscellaneous employees.

 The number of employees also 
impacts municipal pension 
costs. The City’s number of staff 
per capita is roughly half of that 
for larger cities such as Pasadena. 
There were no increases in 
the number of employees in 
the adopted budget for FY 18-
19, and in the last five years 
only three full time positions 
were added, all of which were 
conversions of existing contract 
employees to City employees.

 Finally, South Pasadena 
employees pay 100% of the 
employee’s contribution for their 
defined benefit retirement plan. 
In the past, it was common for 
cities to pay both the employer 
and the employee contributions. 
South Pasadena has shifted all of 
the employee contribution costs 
to the employee.

What about future pension 
costs? 

 The City has implemented all 
feasible pension cost reduction 
strategies available under the 
law. The significantly rising 
costs faced by cities are a result of 
policy changes and investment 
decisions made at the State level 
by the CalPERS Pension Board.

 CalPERS’ investments suffered 
greatly from the economic 
recession that began in 2008, 
when the system suffered a 
gross impact of nearly 35% loss 
to its investment funds. As a 
result, CalPERS has become 
much more conservative in its 
estimates of return, and has 
shifted policies to account for 
longer lifespans among retirees, 
fewer active/working members 
in relationship to the number 
of retirees, and other factors. 
The financial impacts are not 
limited to South Pasadena; cities 
across the State are struggling to 
comply with the new demands.]

 In the future, pension liabilities 
will be reduced as a result of 
pension reform at the State 
level. The California Legislature 
took a significant step to lower 
future pension costs with the 
California Public Employees’ 
Pension Reform Act (PEPRA), 
which took effect in January 
2013. The legislation changes 
the way CalPERS retirement 
and health benefits are applied 
and places compensation limits 
on retirees. Under PEPRA, 
retirement formulas are further 
reduced and the retirement age 
increased. 

Could the City leave CalPERS 
in favor of a 401(k)-type plan 
for employees?

 Terminating its contract 
with CalPERS will trigger a 
termination fee imposed by 
CalPERS that would increase 
pension costs substantially. 
Upon termination, the 
exiting agency is required to 
prepay all contractual future 
pension obligations, which 
are determined by a CalPERS 
actuary. This is like accelerating 
all the payments that would ever 
be due for all current retirees’ and 
existing employees’ retirement 
pensions and requiring the 
existing city to pay that amount 
up front. South Pasadena would 
be subject to extremely high fees 
that would make an exit from 
CalPERS unfeasible.

Could a City require new hires 
to accept a 401(k) type plan, in 
lieu of CalPERS?

 No, the City has no authority 
under its agreement with 
CalPERS to unilaterally 
determine that new hires cannot 
participate in the CalPERS 
retirement system.

 The Arroyo Verdugo 
Communities Joint Powers 
Authority is seeking 
feedback on potential 
transportation projects to 
fund in South Pasadena 
and surrounding cities. 
The projects will be funded 
by Measure M, the voter-
approved sales tax increase. 
Your feedback will be used 
as the Authority develops 
the Measure M Five-Year 
Multiyear Subregional 
Programs (MSP) for 
transportation projects 
in the Arroyo Verdugo 
communities. Please take a 
moment to give your input: 
tinyurl.com/AVCJPASurvey 


San Marino 
Open 
Volunteer 
Positions


Chu States: Working Families 
Should Not Have to Pay 

for Corporate Tax Cuts

 
Last week Senate Majority 
Leader Mitch McConnell 
said that it was time to cut 
entitlements like Medicare, 
Medicaid, and Social Security 
in order to pay for a federal 
deficit that has grown 77% 
under his watch. According to 
the Treasury Department, the 
US deficit grew to $779 billion 
in President Trump’s first full 
fiscal year as president, due in 
large part to the Republican tax 
cuts which slashed government 
revenues. Rep. Judy Chu (CA-
27), a member of the Ways and 
Means Committee, released the 
following statement:

 “Acting on behalf of corporate 
influence, Republicans made it 
their first priority in Congress 
to pass tax cuts that would 
make those large corporations 
richer. But they still had to 
sell it to the American public, 
the vast majority of whom are 
not seeing the benefits of this 
law. So Republicans claimed 
that massive tax cuts which 
take revenues away from the 
government and slash rates for 
billionaires and multi-national 
corporations would pay for 
themselves, knowing that they 
never have in the past. And 
now, Senator McConnell is 
coming back to the American 
people and telling them to give 
up healthcare and retirement 
security so that he can pay 
for the tax cuts to those who 
already have the most. Speaker 
Ryan, likewise, has made it 
clear that taking away from 
Medicare, Medicaid, and Social 
Security is how tax cuts actually 
get paid for.

 “If Republicans cared so 
much about the deficit, they 
never should have passed these 
tax cuts, which were always 
projected to explode the deficit.

 “The American people are 
paying attention. We see that 
corporate profits are rising, 
while workers’ wages have 
stayed flat. And we see tax 
cuts turning millionaires into 
billionaires, while Republicans 
try to balance the budget on 
the backs of working families. 
Before making a single cut to 
Medicaid, Medicare, or Social 
Security, Republicans must 
explain why they think average 
Americans should do with less 
so that billionaires can have 
more.”

 The City of San Marino is 
seeking a volunteer to fill an 
opening for the Alternate 
position of the

Public Safety Commission 
beginning immediately. 
The City of San Marino is 
also seeking a volunteer 
to fill an opening for the 
Alternate position of the 
Design Review Committee 
beginning immediately.

 Contact Administrative 
Analyst/Deputy City Clerk 
Nia Hernandez at (626) 300-
0705 or email

 nhernandez@
cityofsanmarino.org for 
further information or 
you may download the 
Commission

Application from the 
City’s website at www.
cityofsanmarino.org

Deadline for submitting 
applications is Friday, 
October 26, 2018 at 5:00 PM 
to:

San Marino City Hall

c/o Nia Hernandez, 
Administrative Analyst/
Deputy City Clerk

2200 Huntington Drive

San Marino, CA 91108

Family 
Storytime 
for all Ages

San Marino Free Self 

Serve Compost Giveaway

 A free compost giveaway 
self-serve event will be held 
on Saturday, October 27th 
from 9 a.m. until noon at 
Lacy Park in San Marino 
in the west end parking 
lot. Bring your own sturdy 
containers. There is a 
30-gallon limit during the 
first hour and no limit from 
10 a.m. until noon, or while 
supplies last Plastic bags are 
not allowed. Bring your ID 
card or Athens bill.

 For more information, 
contact Ed Chen at (626) 
703-9726 or chen@
athensservices.com. 
or Ron Serven, Code 
Enforcement Manager at 
(626) 300-0789 or rserven@
cityofsanmarino.org or 
Dana Hang, Administrative 
Analyst at (626) 300-0765.

 Children’s Librarians read 
age-appropriate stories and 
share fingerplays, songs, 
flannelboard stories, and 
book-related videos with 
children in a group setting. 
The next storytime will be 
Oct. 30 from 7:15 p.m. to 
7:45 p.m. In the Library 
Children’s Room 1100 Oxley 
Street, South Pasadena.


Mountain Views News 80 W Sierra Madre Blvd. No. 327 Sierra Madre, Ca. 91024 Office: 626.355.2737 Fax: 626.609.3285 Email: editor@mtnviewsnews.com Website: www.mtnviewsnews.com