Sometimes as more information becomes available people change their minds. That’s what happened during the Aug. 21 Lompoc City Council meeting when three councilmen finally make the right choice.
Back-in-the-day all we had to go by was the printed word of the reporters and editors concerning what was said during public meetings. Today it’s much different and every word is not only recorded, but also readily available online to refresh the public’s memory about what was said and who was either for or against the proposal being discussed.
To understand the depth of the current change of mindset we need to go back to the 2017-19 budget hearings. On May 2, 2017, the previous city manager said in a briefing to the Lompoc City Council: “The biggest financial hurdle facing Lompoc, according to staff, is the city’s obligation of about $70 million to the California Public Employees’ Retirement System, or CalPERS.”
He also recommended three tax measures for the November 2018 ballot: a half-cent sales tax increase, a 2-percent increase in hotel taxes and a 6-percent utility users’ tax.
At the time, Councilman Jim Mosby felt they could meet their obligation by cutting the budget, and another councilman thought the city could “build its way out of the problem.”
Neither idea has worked because there wasn’t enough fat to trim and simply building houses only places a greater burden on city services than added property tax revenue can support.
Three councilmen (Jim Mosby, Dirk Starbuck and Victor Vega) refused a motion to even consider a tax increase. Following those hearings, the city manager was forced out by the same council majority for simply telling the truth about the fiscal condition of the city and offering solutions to the revenue shortage.
Two years later during the 2019-21 budget hearings, councilmembers were told the CalPERS debt had grown to $80 million. This wasn’t caused by anything the city staff or city employees did, but by the actions of the appointed CalPERS Board of Directors concerning how the funds investments are managed, reactions to global markets and a failure to fully comprehend future revenue needs.
CalPERS has consistently overestimated its return on investment, failed to account for increased longevity of the recipients, and politicians have guaranteed a specific benefit to retirees unlike traditional plans such as 401k or private sector-retirement plans where payouts vary based on investment strategies.
To solve itd problem, the CalPERS Board simply “adjusts the level of contributions” by local governments to maintain fund stability. History proves those adjustments always go up and rarely go down.
Once again, throughout the budget hearing process the same three councilmen adamantly refused to consider sales tax increases as a necessary part of the budget balancing process. It was only after more than 100 public speakers demanded the right to vote on the issue that Councilman Starbuck finally proposed a temporary tax measure.
On Aug. 21 the council discussed two potential tax proposals. Leading into this discussion they found out the CalPERS debt had now grown to $93 million, a 165 percent increase over the last seven years with half that amount attributed to the General Fund and that the “contribution” would likely increase again.
The projected payment rate for CalPERS will continue to rise until 2031 and it won’t return to the current level until long after that.
The city, through negotiations with the employee unions, has taken positive actions to reduce retirement costs. The retirement age was increased, and the amount received at retirement adjusted downward for newly hired employees; and, employee work groups have agreed to contribute substantially more to their benefit packages.
After considerable discussion, the council agreed unanimously to place a 1-percent General Tax measure on the ballot with a 15-year sunset. Once the vote was in, Mayor Jenelle Osborne said, “Thank you all for changing your minds. I believe you finally listened to the community.”
Councilman Vega said, “Nobody was ever against, that I know of, putting a tax on the ballot. … We were just trying to vet everything.”
And, Mosby said emphatically, “I never changed my mind.”
Well, their public voting record for the last two years says something different.
So, even though the three councilmen finally took a positive step toward managing this growing debt, they now appear to be trying to claim they were in favor of putting a tax measure on the ballot all along.
Had the council chosen to follow the former city manager’s revenue proposals in 2017, the city would be in far better fiscal health today.
Now it will soon be time to vote.
— Ron Fink, a Lompoc resident since 1975, is retired from the aerospace industry and has been active with Lompoc municipal government commissions and committee since 1992, including 12 years on the Lompoc Planning Commission. He is also a voting member of the Santa Barbara County Taxpayers Association. Contact him at news@noozhawk.com. Click here to read previous columns. The opinions expressed are his own.