Gimme Your Money

On Monday I wrote about the City of Long Beach and the perpetual deficit due primarily to the inability, or rather the unwillingness, of the City Council to address the basic issues which plague the balance sheets and income statements. Deficits exist because of a gap between revenue and expenses, with the latter greater than the former. One way to solve deficits is to increase revenue rather than cut expenses, this is the route most elected officials prefer to take in our region and state.

Revenue growth of course is generally meant to mean tax increases but taxpayers don't like to read about tax increases but feel good about increasing revenues. Which explains a lot of the behavior of the electorate in the ballot box.

Revenues need not always need to be from direct taxes, but can also come from other entities that receive taxes. What the Long Beach City Council has been doing the last few years to prevent having to make the necessary decisions to solve the budget deficits is essentially engineer their own bailouts, or like street thugs at a mugging demanding "Gimme your money."

The Port of Long Beach is a huge economic engine. Over the decades it has consistently been ranked as the busiest or second busiest port in the world. Sitting side-by-side with the Port of Los Angeles, the harbor area sees tons and tons of cargo loaded and off loaded every day. Almost anything you see stamped "Made In China" comes through one of these two ports. With each car, radio, shirt or laptop comes a few pennies in revenue for the ports.

State laws dictate how the Port can spend its revenues and profits, often times the City of Long Beach needing some financial assistance will take a look at the laws on the books, see that the requested expenditure is a valid and request funds from the Port of Long Beach. And the Port of Long Beach, governed by commissioners appointed by the Mayor, accedes to the request. Essentially the Port of Long Beach is the City of Long Beach's rich uncle who has a hard time saying "No" to his favorite niece--no matter how much trouble she has gotten herself into.

The commissioners have done an excellent job running and managing the Port. Properly planning for expansion and growth, putting aside reserves for future projects, such as a new bridge between Long Beach and San Pedro. The Port nonetheless seems to have a special reserve account for the recalcitrant niece who cannot control her spending or properly budget for her future.

The City of Long Beach has considerable portions of the city that are in enterprise zones and business districts. Revenues (taxes) are collected and put under control of the Redevelopment Agency for use to, oddly enough, redevelop blighted areas of the city. The RDA has different zones, downtown, central and north. The problem from many citizens viewpoint is that for decades the RDA seemed to exist solely to dump money in the the downtown project area at the expense of the redevelopment in the rest of the city. Particularly frustrated over the years has been those who live north of the San Diego Freeway, those in the North PAC.

Raided over the years to make up funding shortfalls in downtown and central area projects, now the RDA is using funds designated to redevelop North Long Beach to bailout the city on debt payments for the Aquarium of the Pacific. For the second year in a row. For those readers not familiar with the Long Beach and the Aquarium of the Pacific it is not located in the North PAC.

Year after year, seemingly month after month, the City of Long Beach is asking for the wallets of the Port of Long Beach or the Redevelopment Agency for bailouts. Time after time, request after request the Port and RDA hand over their wallets.

Our city government is being enabled by the Port and RDA to make poor budget decisions and rewarded for not properly planning, and sticking to the plans they make. Elected and appointed officials behave like spoiled trust fund kids who know their mistakes or poor decisions will always be covered by the two entities. Because of term limits none of the council members have to live long term with their poor decisions and pushing any difficult budget decisions into the future.

Now we have an even richer uncle providing even greater bailouts that relieve the city from one of its basic duties: maintenance of infrastructure. All around town we have had torn up roads and big signs saying we are restricted to one lane and sitting in stalled traffic because our route is being repaved thanks to the American Recovery And Reinvestment Act of 2009, i.e. "The Stimulus." Like the Port providing funds so we can keep lifeguards or the North PAC having funds robbed to keep the fishtank open, the Feds are paving our roads for us. Thanks to the kind people of Tulsa and Pierre our city government can cross that expense off the list and use the funds for more salaries and benefits elsewhere.

Redevelopment funds are sorely needed in North Long Beach. Taking funds from the North PAC to support the Aquarium, whose tourist dollars only help downtown businesses, is unjust to the people of North Long Beach and the taxpayers who pay into the RDA coffers. North Long Beach is grimy, dirty, crime ridden, filled with many hard working people and many laze leaches on society. There is a lack of business and commerce, I don't think there is even a coffee shop in the Ninth District. There is no development because in years past the North PAC was raided to pay for projects elsewhere. And there will be no redevelopment in the near future because funds are now being raided to bailout the city on its debt obligations elsewhere.

The Port of Long Beach has proven fiscally responsible and a great economic partner for the city. Now the City Council and Mayor will push for passage of a ballot measure to change the City Charter to restructure how much money the city gets to take from the Port every year. Like most governments they feel they can better spend the money better than the person, or organization, that earned the money.

Like many large urban cities across the country Long Beach is failing economically. Not because of the downturn in the economy but because of the downturn in political courage and vision. Long Beach is fortunate to have wallets to rob, other cities not so fortunate. Until a majority on the City Council have the guts to stand up and make difficult decisions to slash expenses and programs while laying out the purpose and long term vision of fiscal responsibility our city will continue to flounder and look to others for bailouts.

Running for office means you are willing to make difficult decisions. Decisions that will not please some people, and may in fact bring some harm to some citizens in the short or long term. However the overall quality of life for the majority of residents and businesses should be critical and central to decision making. Not what is best for city employees, but what is best for the residents and businesses that are invested in the neighborhoods and business corridors that make a city what it is.

It is time for the City Council and Management of the City of Long Beach to quit depending on others to cover their fiscal and political cowardice. Make the hard decisions and put our city back on a healthy fiscal plan for our future.

DCS08042010

City Budget Decisions: It's Deja Vu All Over Again

Yogi Berra, famous for his malaprops, infamously said "It's like deja vu all over again." That sums up perfectly the City of Long Beach budget process that is now underway. And probably the budget process of most cities across the state and many across the country. With just two changes, for the council members from the 7th and 9th, I could just repost the piece I wrote last September, "Dear City Council, Fix It" and once again follow up with "How To Crush Budgets: The Median Income Spiral" because nothing has really changed structurally or politically in Long Beach. To update for the current council from last year's district by district analysis I would say no real change in the 7th and a big change in labor's favor in the 9th. Not good news for residents looking for real shifts in fiscal policy at City Hall.

Last year I said that until the City Council addresses the pensions and benefits for public employees we can expect to read about the City of Long Beach facing another $20 million deficit next year. I was off by $1.5 million as the City must deal with an $18 million deficit. Despite the calls from 3rd District Councilman Gary DeLong last year there has been no movement to reign in the spiralling pension and benefit costs for the city. As a result next year at this time I will be writing about the City of Long Beach and its $20 million deficit.

Last year's budget was presented and passed with the hopes that the City could renegotiate with the various unions that represent almost all workers, from public safety through Parks & Rec. While there were some minor concessions made in negotiations earlier this year the golden eggs were not touched nor discussed. With no real change in the composite of the City Council and their dependence and favoritism to the public employees' unions we can expect no real change in the structural deficit our city faces due to growing pension and benefit contributions and payments.

While pay increases have been postponed under recent negotiations, at some point those postponements come due. As I wrote in "...The Median Income Spiral" when the pay raises are due to kick in the City will continue to use the formula of basing our employees' salaries on those in surrounding and like sized departments and populations. Ask the cities who have the City of Bell in their median income pool how that will go for them. Because of the formulas used to determine salaries and benefits, Long Beach continues to facing growing spending and deficits until the City Council directs the City Manager to re-open all city contracts and renegotiate them from top to bottom.

Meanwhile Mayor Foster and City Manager Pat West have presented their budget to Council and workshops and budget sessions have begun to debate where to slash spending to make up the $18.5 million gap. This past weekend the Press-Telegram published 43 budget questions for readers to answer with a simple "Yes" or "No" regarding budget cuts. (It is also on-line for those who wish to chime in: "How Would You Cut Long Beach Budget")

Thanks for asking but I would have answered anyway. As I have stated in the past the primary problem our country faces when it comes to governance is no vision and no over-riding philosophy of the purpose of government at each level. For Long Beach I believe the most basic purpose of the city government is to protect persons and property, to provide services that provide for the safety of the citizens, to build and maintain the infrastructure necessary to support neighborhoods and business districts, to provide limited services that promote the general welfare of all citizens, such as libraries. According to my perceived purposed of city government the budget should focus on public safety, which includes not only police and fire but also life guards, park rangers and crossing guards; city inspectors for buildings, health and code enforcement; maintenance crews to repair city streets, sidewalks, sewers, water lines and public parks and buildings; public libraries, parks and recreation. Since our City has a Health Department which keeps us somewhat independent from the County it would also by a budget priority. Once those budgets are properly funded and secured if there is any funding left over then the City can consider temporarily funding other services and programs that have mushroomed over the year. Do we really need a Human Dignity Officer and staff? A Mobility Coordinator? A Sustainability Office? Do we need to spend millions of dollars on bike lanes? Do we really need both a Civil Service Department and a Human Resources Department? How many departments and personnel do we have that are feel-good departments that cost money that should be used elsewhere?

Unfortunately I have little faith in our current City Council to make the necessary cuts and give the necessary instruction to fundamentally change the budget of our city. The majority are beholden to public employees for their positions, current and future when they seek higher office, and that eliminates fundamental changes in contracts with city employee unions. The majority are of a particular ideology that the purpose of government is too provide seemingly infinite services to mostly poor residents rather than attracting business, economic development and new home owners to stabilize neighborhoods. They would rather perpetuate the pockets, growing, of poverty that attract more crime, more public service dependent residents and more poverty. Instead of developing a long term economic plan to provide for more private sector jobs the City Council has decided a major public works project requires a Project Labor Agreement to drive up costs against a deficit budget and restrict employment in an almost 20% unemployment community.

My expectation is that City Management will not be scaled back, union contracts will not be renegotiated, and we will face another $20 million or more deficit next year. And the year after. In 2012 we will have another election, this time for the even Districts, and the same general ideology and fiscal policy mentality will remain. And City residents will complain about what programs are being cut after essentially electing the same politicians cycle, after cycle, after cycle.

Visit the Press-Telegram site and cast your votes on what should be cut, but don't expect much in the way of results. Our City Management and Council don't have the stomach for them, results that is.

DCS08022010

Time To End Public Employee Furloughs

Last week, under the push of Mayor Antonio Villaraigosa and his staff, the Los Angeles City Council put financial prudence ahead of political alliances. Looking at the continuing downward spiral of budget deficits beyond their own terms the elected officials stunningly voted 9-3 to eliminate four thousand jobs in the City of Los Angeles. Previously there was considerable consternation over a Villaraigosa proposal to eliminate one thousand jobs at the city, to vote weeks later to work towards not only agreeing to the Mayor's request for one thousand jobs to go but to add another three thousand was quite a shock.

With their vote and intended action, the Mayor and City Council of Los Angeles are doing something that other public officials and elected leaders are denying: payrolls and accompanying benefits are too large and are crashing budgets.

Last week I took some heat in a few emails for the statement in my post (Agenda 2010 = Jobs or More Pandering) that if the State Franchise Tax Board is losing $21 million per month in collections because of the current state furlough program they should be laying off people instead of furloughing them. I stand by that statement and wish to expand upon it. The State of California should end all of their employee furlough programs. The furloughs are supposed to be saving the State approximately 15% of the payroll costs to the budget. The furloughs have been in effect for long enough now for all departments and consumers to adapt to closings of offices and departments one day a month. Evidently the jobs can be done with 15% less in payroll expenses. So time to elimate the expenses permanently, end the furloughs and instead lay off or eliminate 15% of the jobs paid for by the State of California.

When Governor Arnold Schwarzenegger announced furloughs he was immediately attacked by his political opponents and the unions went to court to protect their salaries and benefits. So far the furloughs have held up and the state has been able to save millions of dollars to add a few drops back to a bucket that is leaking billions. But furloughs are not enough for the state to get back to level on the balancing of revenues and expenses, as we can see by the state once again running out of cash sometime this month or next.

Democrats in control of the Legislature with majorities in both houses short just a vote or two enacting any budget want to raise taxes and fees even more than last year's budget, which was the largest increase in taxes and fees in history. Still ignorant to the basic economic fact that the biggest problem in California is not revenue but spending, the Democrats want to further decrease revenues by choking off jobs and increasing taxes and fees across the state.

Why do Democrats wish to increase fees and taxes on all Californians? To prevent layoffs and furloughs of the public employees who pour millions into campaign donations up and down the state to Democrats running for city, county, state and federal offices. The political alliances between the public employees across the state and elected officials who happen to be registered Democrats has become a choke hold on budgets up and down the state.

Looking to the future the State economic situation is not improving and revenues are not going to increase to provide for the salaries and benefits of all those on public payrolls in the near future. Schwarzenegger and Sacramento pols can beg for more money from Washington but we are politically useless to the Obama Administration and Congress by virtue of the State's guaranteed delivery of votes and Representatives for Democratic majorities. With the state out of play politically it is out of play fiscally as well. Even with federal funds the problem is not solved, as can be seen with one-time funds from the American Recovory and Reinvestment Act (aka Stimulus I) which may have protected some public sector jobs for one year, and added an additional year of long term benefits to the balance sheets.

For the rest of this fiscal year, next year, the year after and the year after that and beyond there is not magic pot of gold that will bring billions of dollars in revenue to the State. As much as the Legislature wants to squeeze more and more money out of us for taxes on income, savings, health insurance, transportation, goods and services, technology, very soon they will see there is nothing left to squeeze. Only then will they see that it is time to cut expenses and the number one expense in every organization are employee salaries and benefits.

With term limits in place it is easy for current politicians to push the expense cutting to the next term and the next elected official. In the meantime by listening to their campaign donors instead of their consituents, who are losing jobs at a rate of 15%, they are digging a deeper and deeper financial hole. And will take more and more money from local governments and citizens.

Which leads me to Long Beach, and other cities in the state facing severe budget deficits. Mayor Bob Foster needs to show the City Council the future, and it looks a lot like the City of Los Angeles. With Sacramento making no changes to its mentality to protect spending and trying to increase revenues in a down economy with a state unemployment rate realistically running at over 15%, the economic future for Long Beach is pretty bleak. The State will raid more funds in each successive budget draining millions and millions from City and County budgets. Today's $20 million budget deficit is tomorrows $30 million gap, or bankruptcy.

Furloughs are a difficult short term solution to a short term problem. Most private sector firms that use furloughs do so with a plan and eye to increase revenues and business to be able to eliminate furloughs within months, a year at most. Any plan that does not foresee being able to bring back employees to full time within twelve months is a plan where furloughs are not a solution.

Furloughs may save some money in the short term, but as a long term solution they are detrimental because of the accrual of benefits, especially retirement benefits. Keeping the positions on the payrolls adds more years to pensions that future taxes and fees will have to support. By foregoing layoffs and elimination of jobs through furloughs for a prolonged period of time the City, or State, is saving some money in the short term but continuing to add expenses to future budgets at an exponential rate.

Looking at the economic landscape and future for public revenues it is time for our elected officials to do what is best for the long term benefit of their constituents and future generations and quick the furloughs of public workers. As we have seen a reduction of 15% of service through furloughs have had a minor impact on the overwhelming majority of residents, ergo we can cut services and payrolls permanently by up to 15%.

Our elected officials need to end the furloughs, cut the jobs to balance budgets and reduce government spending and growth. It is time to look at the economic reality and not the political alliances.

DCS 02222010

Ethics

What are the ethics of hoping someone has misbehaved so you can back-up your "gotcha" philosophy?

Is it ethical to create misconceptions for other people about someones behavior?

How ethical is it to destroy someone else's personal relationship?

Can people be trained to be ethical or are ethics learned as they are experienced?

If someone must attend "ethics training," whose ethics are they learning and how does he know the trainer is ethical?

If someone does something which you disagree with does that make them unethical, even that act is legal?

Whose ethics are more important, yours, mine, society's, whose?

Is it ethical to presume someone is misbehaving merely because they are in personal contact with someone you mistrust?

I love conversations about ethics. For the past three or four years I have had the honor of facilitating a discussion on how to define ethics for Leadership Long Beach's incoming class of participants. When a discussion on how to define ethics is started it quickly becomes apparent that ethics, like art, is hard to describe; we know it when we experience it. Or better yet in regards to ethics, we know it when we don't experience it.

The challenge with defining ethics, for me, boils down to "whose ethics?" Your personal ethics based upon your moral code, or my ethics based on my moral code? The ethics of your company or organization? While many like to purport a single standard of ethics, I challenge the assertion. A few simple questions shows that ethics are not universal. Is abortion ethical? Is the death penalty ethical? Is the confiscation of private property ethical? Is denying the homeless woman asking for food ethical? Is killing someone ethical? If they have broken into your home and endangering your children? Is something ethical just because it is legal?

Ethics, for me, are actions directed by morals that separate "good" from "bad." If we share the same morals then we probably share many of the same ethics. Companies and organizations have a culture that determines the ethics of that organization, typically based on the morals of the leadership and their values. As a society we have overlapping ethics, picture everyone walking around with the "ethics circle" surrounding them, some circles perfectly overlap and some are never touched--almost as if within society they have no circle. From the shared morals and ethics of the majority we derive our laws. Being a Republic our laws then govern us. Shared ethics codify in law.

Part of my ethics is understanding they are mine and may not conform to yours and vice versa. Therefore it is probable there are times when you consider me unethical, or I consider you the same. As long as neither of us is breaking the law and can disagree on what is ethical we can peacefully coexist. When you begin to feel that your ethics are more important than mine, that your moral compass is superior to mine, that I am being unlawful, immoral and unethical, in a situation where I feel I am not, when that happens we have a problem.

I am not a big fan of Conspiracists (don't look it up, I just typed it). Those who think every move made by someone in leadership or power is either unethical or illegal and done merely for self-advancement or monetary gain. You know the ones I am talking about, an elected official sneezes in their presence and they accuse them of trying to give them H1N1 to silence their criticism. The ones who find someone they dislike and then they create dislike and mistrust within the community. Using broad brushes they paint anyone who comes into contact with that person because to them he is unethical and always dealing in unethical matters. Conspiracists enroll others behind their attacks and accusations with the sole goal of discrediting other people's character and motives, essentially working to destroy careers. All under their banner of "ethics." Their perception of right and wrong. Because someone disagrees with them or wants to pursue an opportunity they do not like Conspiracists become personal in their attacks, move the discussion away from the opportunity or issue and instead try to make it a discussion on character. Conspiracists tend to be narcissistic and holier than thou, and me.

In the process they damage a community, create divides, breed contempt and facilitate mistrust. When they have accomplished this they smile and say, "look at what I have done, I have won."

For those not in the Long Beach area such a construction of false information and false accusations of unethical behavior is gripping our City Hall. Our City Council is immersed in discussions and debate and details to determine how to control individuals ability to speak with members of our government. A howl has arisen in our community demanding that anyone who leads a company, wants to create opportunities in our community for jobs and development, be limited in how and when and where they can present their ideas and opportunities to city officials. Our city is on the verge of codifying mistrust and declaring no one behaves "ethically" on their own, essentially saying the city is in the habit of hiring and electing unethical individuals whom we should mistrust.

This is all as a result of an over-reaction to a trip taken by two lifelong friends and their families. Two men who grew up together, whose wives and children are friends, had a weekend get-away with their wives as friends are apt to do. One friend is a consultant and represents a myriad of businesses and organizations who have businesses, or wish to have businesses, in the City of Long Beach. One friend works for the City of Long Beach and reviews and analyzes new projects and developments for the City Manager and Council. The families stayed at a hotel owned by one of the consultant's clients and at check out, without the city employee's knowledge or consent, issued a discount. We know this because upon returning to Long Beach and learning of the discount our ethical city employee repaid the discount and disclosed it to his bosses.

His ethics empowered him to action to do what was right. Now he is under scrutiny and an aura of mistrust and deceit is being built around him by the Conspiracists for they have long ago put his friend the consultant on their radar as someone to attack personally and professionally. By doing the right thing, by behaving ethically, our stalwart, competent and professional city employee has been tarnished.

Is it ethical to attack someone for doing what is right? Or would it be ethical to say, "this is what we expect of all of our employees, when they find out something happened that is not right to expose it, accept it and correct it?"

By their actions the Conspiracists have created an environment where future mistakes that are discovered may be covered up instead of exposed for fear of personal attacks and possible damage to their careers. By attacking two men who are life long friends for being friends the Conspiracists have made our city a bit more unfriendly to businesses, have created a bit more separation between City Hall and city residents and businesses, have created a bit more "Us" versus "Them" in our community. How is that for ethical behavior?

Ethics, I know them when I experience them, I know them more when I don't. Craig Beck is a good man who does good things for our city. Mike Murchison is a good man who does good things for our city. Both have good morals, good values and good ethics. Both work hard to improve our city and community. Neither deserves the treatment they are getting from the Conspiracists, who are getting too much press and exposure.

I hope there friendship continues for many, many years and it includes more trips together enjoying each others company and families. It isn't ethical to turn our backs on our friends when they have done nothing wrong.

Dear City Council: Fix It

Like many cities across the country, and particularly in the State of California, the City of Long Beach management and elected officials have recently worked through the budget for the coming year to cover a multi-million dollar gap between revenue and expenses. Putting a lot of faith in future negotiations with the various labor groups that represent most city workers, approximately $20 million was cut from projected expenses to balance the budget. Now if they can just figure out how to reduce another $20 million for the 2010-2011 budget and yet another $20 million for the 2012-2013 budget.

One assumes that we can continue these budget deficit projections ad infinitum given that one of the major expenditures has not been addressed: pension and benefit reform for City employees. With each budget and each contract negotiation this issue has been passed over and left for some other City Council. It appears the time is right for this City Council to address this issue, if only those sitting in the seats have the political courage to stand strong and address the issue.

Restructuring public employee pensions and benefits requires stamina, patience and commitment to an outcome. Politically the public employee unions are highly sought allies when candidates are running races because of their ability to pour resources, not just cash but bodies to man phone banks and knock on doors, into those whom they support. In Long Beach a tremendous number of city employees live in the City and are voters adding a bonus for candidates not just of financial support but of actual votes. It is rather incestuous the relationship between our local elected officials and those who work for them once elected, and without entering that relationship getting elected in Long Beach is extremely difficult.

Then there is the next level of politics: State office. In Long Beach to get elected to the California Assembly or Senate two things must happen: 1) you must receive support from the unions, public and private so you can 2) win the Democratic primary. If you achieve (1) you will achieve (2) and you will then win the general election. Happens every time as our city is appropriately gerrymandered and loyal to the Democratic Party to ignore any part of the general election with the exception of the (D) after a candidate's name.

To quickly recap: successful candidacies in Long Beach politics are heavily dependent on endorsements and support from unions.

Union leaders are not running out of their offices to meet officials for the purpose of restructuring the pensions and benefits of their members--after all they are elected as well. In fact getting them to sit down for the specific purpose of such a restructuring negotiation is extremely difficult. But that is exactly what needs to occur in Long Beach (or fill in the blank with your California city, county or just say California).

Politically Long Beach appears to have an excellent window of opportunity for significant restructuring of pensions and benefits to occur in all the city contracts. Looking at the upcoming elections, who is being termed out and prospects for future office, the timing is now for members of City Council to address this issue without a majority of the council having to fear political retribution from the unions hampering their political careers. Let's take a look at the Mayor and nine City Council Districts:

Mayor Bob Foster has already begun his fund raising for a re-election campaign, while anything can happen and he, like all mayors and politicians, has his detractors, any candidate will have an extremely hard time unseating him. During an interview session I was part of for the Long Beach Post last year, Mayor Foster indicated he wanted to tier the pension system for new employees and have them contribute more to their pensions and benefits. He is on board to take on the unions over this issue--so he said and I will take him on his word.

1st District Robert Garcia has a very bright and long political future ahead of him. His campaign to win the special election for his seat was almost flawless and he won handily. He is up for re-election in 2010 and it is difficult to see how any candidate will defeat him. Garcia's challenge is going to be what route does he want his political career to take? Stay in Long Beach and run for Mayor when Foster is term limited out? Go after a statewide office? Take on Laura Richardson for Congress? My outlook is he takes the City Council to Mayor race, using his next term on council to continue to build his support and influence through the city. Where does this put him on restructuring pensions and benefits? Garcia has as much influence or power in his short term in office as anyone on the Council, he can very well afford to spend some political capital and pursue aggressive reform. His district has some of the greatest needs for programs and assistance from the city for his constituents, freeing up funds from future budgets that would be going to such programs is in his and their best interest. I put Garcia in the "yes" column for reform.

2nd District Suja Lowenthal is at a bit of a crossroads and whatever her future political plans may be I have not heard. Will she run against her ex-mother in-law for Assembly? Will she run for her ex-father in-law's seat if he is elected Lieutenant Governor? Or will she serve out her term limits and return to private life working at Cal State Long Beach. It is doubtful she can take on and beat Bonnie Lowenthal who has years of relationships with the organizations and groups needed to win. Also in doubt is her ability to capture Alan Lowenthal's supporters, who would be needed to win any primary for State Senate. Her divorce from Judge Dan Lowenthal has created a rift between her and the tight Lowenthal clan, which frees Suja Lowenthal to aggressively pursue contract reforms with public employees. Will she? Like Garcia, her district is in as much or more need of the funding that would be freed up with such reform, I am uncertain however if she would be willing to enter the fray. I put Lowenthal on the fence.

3rd District Gary DeLong publicly stood up to the Long Beach Police Officers Association during last week's City Council meeting casting the lone vote against a contract revision with the LBPD officers. His reason was that pension and benefit reforms were not addressed, because of this he did not support the contract since in his opinion the negotiations did not go far enough. Facing re-election in 2010 and then being termed out, and it being doubtful he will seek another office, DeLong is on record to fight for aggressive reform of employees' benefits and pensions.

4th District Patrick O'Donnell is a member of a union, his brother who passed away several years ago was a member of the LBPOA, his orientation is pro-worker. This would lead one to conclude he would be against any restructuring of the contracts and putting more of the pension and benefit costs on the employees. Politically however O'Donnell has not much to lose by working on such reform. He is termed out after this cycle, unless he runs a write in campaign he will not be needing political support from the unions. While there were rumors before he may run for statewide office, looking at the seats available and when they become available the timing may not be right for O'Donnell. While he can see the benefits of reform, his DNA may be such that any support might be luke-warm and pursuit of aggressive reform may be out of the question. I put O'Donnell on the fence waiting to see what comes to council before strongly committing, if he ever strongly commits, to any reform plans.

5th District Gerrie Schipske is a liberal up for re-election in a pretty conservative district. She has strong ties to labor, see her employment by the teacher's union as one example, and has fought Mayor Foster on many issues. Schipske has had very good political instincts in picking her battles and issues that play well at home on the Eastside for her constituents and is not afraid to be confrontational downtown. Like O'Donnell her DNA puts her at odds of asking the workers to give up anything in a contract, much less dip into their own pockets to pay for pensions and benefits. However, she is up for re-election in a district where such reform would be popular. Put her on the fence as she sees which way the winds are blowing. Her future political career versus short term re-election.

6th District Dee Andrews has twice defeated a strong labor candidate to win elections to City Council. As with Garcia in the 1st and Lowenthal in the 2nd, Andrews' 6th District has significant needs of any city programs to assist its residents. With no re-election in 2012 Andrews is in a great position to take a lead on pension reforms and show his residents and the rest of the city that the priorities for the council should be citizens first and employees second. Will Andrews pick up the staff and lead on this? He can but we will see. I will rate Andrews as favorable to reform.

7th District Tonya Reyes Uranga is termed out in 2010, which would put her in a position to support strong reform efforts as he political future is blocked by incumbents and term limit math. However Uranga's husband is running for her seat against some very good competition in the 2010 election. Politically Uranga's move is to fight any pension or benefit reform to curry the good graces of the unions for her husband. This move goes entirely with her political career and ideology so count on stiff resistance from lame duck Uranga for any reforms.

8th District Rae Gabelich was re-elected in 2008 with no opposition on the ballot. She is out of office on term limits in 2012 and unless she mounts a write-in campaign her political career ends there, with the possible exception of education boards. When she was elected in 2004 she beat incumbent Rob Webb with the support of the police and fire unions, but has the payback ended? Gabelich is not a standout on the council, with the exception of any airport issue she is rarely heard from and is not one to make any radical proposals. Her position on the issue is hard to gauge and while she has no negatives to push for aggressive reforms other than perhaps her personal ideology, it is difficult to see her taking a strong position on the issue. Put her on the fence depending on what any reform package looks like.

9th District Val Lerch is out of office on term limits in 2010 and running a campaign for write in votes. His competition is Dan Pressburg and Brad Shore. Shore has been very active in his campaign and has picked up some important endorsements. Does Lerch need the city unions in order to be successful in his write in bid? Does it matter? If the unions come out early and endorse Shore then we can expect Lerch to be more aggressive in pursuit of pension reforms. Lerch may aggressively pursue this path without regard to such endorsements as he does have a strong grasp of the long term impact of the current pension and benefit packages on our city and future budgets. Should his opponent(s) publicly oppose any reform Lerch can paint them as in the pocket of the unions and working not for the benefit of the constituents but of the unions. I put Lerch down for pressing for reforms.

So that is my read on the current council and mayor. The votes and political power are there to stare down the unions and use the advantage of another deficit budget that could force layoffs next year, and the year after, and the year after...to negotiate considerable reforms in the city contributions to employee pension and benefit packages. A majority of votes are available where the individuals will experience very little long term fall out to impact their future political careers making this the perfect time for any significant restructuring of the contracts with the city unions. While it will not be easy and there will be plenty of nasty things said about members of council and staff, in the long run doing what is right rarely is easy. And the right thing to do for the future of our city is to re-negotiate the contracts the city pays all of its workers to reduce city contributions and increase employee contributions to pensions and benefits.

The timing is right but do our politicians have the strength and courage to do what is best for our future?

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Take These Jobs And....

We all remember the popular lyric from the appropriately named Johnny Paycheck, "take this job and shove it, I ain't working here no more." A similar refrain has been heard throughout the Golden State for the past decade or more as companies and corporations have opted to open new businesses in Arizona, Oregon, Nevada, Texas, and many other states rather than do so in California. While many in Sacramento point to statistics that they say show no jobs were lost by companies leaving California for the past decade, what they cannot show is that during a period from 2002 through most of 2007 when our national economy grew every single quarter--that is twenty straight quarters of economic growth--California did not gain new jobs. Following the state on this path is the City of Long Beach. During a period of historic economic growth Long Beach lagged behind cities in neighboring states in adding new companies and corporations to employ its residents. Throughout the city and state there has been a loss of manufacturing jobs, assembly jobs, production jobs, and a small increase in service industry jobs. In the past decade California has lost in the neighborhood of half a million manufacturing jobs, in the same time frame however the number of government employees has increased by over 125,000.

Not ones to learn about economics or cause and effect while in office, the Long Beach City Council on July 14th continued on the path of hostility to business and job creation in the city with a vote to postpone approving an ordinance to allow more jobs. While all the attention at the Council was on the proposed Equal Benefits Ordinance that would require contractors doing business with the city to offer equal benefits to registered domestic partners as it does to married couples, by a vote of 7-1 the council was able to postpone the development of a new hotel for at least one more week. With the vote the council once again took out a full page ad in the "Don't Bring Jobs Here" journal that is widely read by executives and CEOs looking to grow their companies.

Several years ago the downtown area of Long Beach changed with the development of The Pike. The new development, designed as an outdoor mall, was to have shops and restaurants and encourage visitors and residents to stroll and shop and dine. About the only strolling however is from the parking garage to California Pizza Kitchen or Islands and most of the shops in between have turned over or are vacant. The development has been a disappointment despite a full convention center across the street, thousands of new residential units that are now occupied within walking distance and restaurants north and south that have thrived since the development of The Pike.

When a national upscale hotelier came to the city and indicated a willingness to build a 125 room hotel on the edge of The Pike it seemed like a great idea. Close to the convention center, downtown offices and the vacant store fronts at The Pike, visitors to the hotel could easily walk and shop and dine--surely such a hotel in this location would help revitalize the site.

Not so fast says seven members of the Long Beach City Council. Anyone who is semi-conscious knows that financing for anything is difficult to obtain in the current economy, but the City Council of Long Beach wants the developer of the hotel to wait a bit longer before securing final financing of the project--a potential deal killer. The hotel will generate much needed revenue for the city directly from bed taxes and secondarily from sales tax revenue of visitors shopping and dining in the city--but those revenues can wait. The construction and furnishing of the development will bring jobs to the city and region, but those jobs can wait. All the positive aspects of this project are on hold. Why?

The Long Beach Coalition for Good Jobs & A Healthy Community (site here) is a front group of organized labor groups that have been pressuring Long Beach hotels to unionize their workers for some time. The group consists mainly of union representatives and representatives of non-profit groups in the community that support immigrant laborers. Their purpose is to get the hotel industry to "invest in its workforce" because it feels uneducated workers with limited to no language skills, English language skills, should be paid on equal terms to educated workers with skills to communicate and use things like computers. Their only purpose of course is to unionize the workers, which will generate more dues for the unions and of course more political contributions for political campaigns. If this group really cared about the workers they would be using their funds to educate them to get high school diplomas, learn to speak and read English fluently and greatly increase chances for above minimum wage employment. Instead the group trots out "representative" workers to say how bad their plight is because they have jobs in a city with an unemployment rate of 12%.

Of the seven council members who voted for the postponement in completing the Hotel Sierra we have the following: 1st District Robert Garcia who is facing re-election in 2010, received backing from public employee unions for his recent election and will need labor support to get any Democratic Party primary funding for his future, 2nd District Suja Lowenthal (whose district includes the hotel) recipient of public employee endorsements and funds, 5th District Gerrie Schipske, former attorney for the teacher's union, 7th District Tonya Uranga who has a staff member on the board for the Long Beach Coalition and whose husband is running for her seat, 8th District Rae Gabelich who received backing and funding from public employee unions, 9th District Val Lerch who received backing and funding from public employee unions and who is running a write-in campaign for re-election. Six of the seven members who voted to delay the construction of the hotel have union support to get into office.

Our City Council is becoming increasingly comfortable in meddling in how businesses operate. No longer is their purpose to provide for the safety of residents and businesses, maintain infrastructure, and encourage a healthy business environment that encourages employers to bring jobs and raise the quality of life in our city. Instead the council and city have veered sharply towards the anti-business crowd, vocal on websites across the city and country that decry anyone who shows a profit, who pays minimum wage, who dare to provide jobs, services and goods to local communities. Why is Long Beach facing unemployment higher than the state of California? Why is California facing unemployment higher than the national average? Why are states like Texas still attracting employers and jobs, companies expanding and growing even in our current environment?

As always with politics follow the money. In Long Beach the only money that matters is money that has been taken from workers through dues paid to organized labor and taken from their paychecks as political donations. Every state district in Long Beach, and with the exception of the Shore every federal district, is overwhelming Democrat in registration. To win an election an individual needs to be a registered Democrat an win the Democratic Primary for that seat. To win the primary they must, absolutely must, have the considerable financial support of the public employee and private industry unions. Ask Laura Richardson. Ask Alan Lowenthal. Ask Bonnie Lowenthal. Ask Wayne Furutani. Despite the role of organized labor in our state and city financial messes with salaries and benefits that have rocketed, they continue to control our elections and officials. Despite the record showing the long term impact of such influence on the auto industry, the airline industry and public budgets across the nation, our officials still chase those funds for their next election.

As long as Long Beach voters keep electing the same people to the same offices being supported by the same funds from the same organized labor groups our elected city officials will continue to behave as they did last Tuesday. Voting to delay or kill projects and developments that would bring jobs and revenue to our city. And the more they follow this path the higher our unemployment numbers climb, in the city and in the state.

UPDATE: Councilman Val Lerch sent me this email this morning after reading this post:

Dennis, a correction to the Sierra Hotel story. I am not in support of any type of forced labor deals. I do not support living wages, (they just become the new minimum wage and drive up costs). I supported a one week delay as a courtesy to my colleague.

Do I need to remind you that I was and still am an opponent to PLAs and the ban on K-Mart. I had hundreds of HERE and LA Feds come after me in the last election and will this election. They put hundreds of their members on the streets in NLB to get me out of office. They backed my opponent spending over 100k against me and denoted 50k more.

Thank you for listening.

Val Lerch
Write-in Val Lerch for City Council 2010
Committee ID #1319487
562-884-2759

Thank you Val for the information, and also your positions on these issues.

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Skate Parks, Pork, Road Signs, Pork, Jobs Lost, Pork....

In January I strongly wrote against newly sworn in President Obama's stimulus plan presented to Congress (Stimulus? Try Democratic Pork) and the $825 billion proposed spending. I am proud that Congress listened to me and paired down the final spending for the American Recovery and Reinvestment Act (ARRA) all the way down to $767 billion. Presented to Congress and the American taxpayer as a bill that would stimulate the economy by providing funding for jobs that would provide jobs and concentrate on "shovel ready" infrastructure projects, the final bill seemed to ignore the premise with many spending items shoved into the hastily crafted bill that have no longer impact on the economy, nor have any business receiving federal funding. The final bill actually extended the reach of the federal government, extending payments to those already receiving federal assistance and expanding the number of eligible recipients. Right out of the box the Act spent billions of tax payer funds on programs that would have zero impact on our economy.

The basic premise of the ARRA is that the government can spend money and pull America out of a recession. By taking more tax dollars from one American, washing it through Washington's bureaucracies and then sending what is left to state and local run governments and washing the funds through them to pay for projects, America's economy is better off than allowing the original holder of those dollars to decide where and how to spend or save or invest the money. This premise is incredibly flawed but one that is central to the Democratic economic theory that the more taxes collected and redistributed the better our economy will be. Unfortunately this theory was tried on a grand scale under President Franklin D. Roosevelt and failed to help the country out of the Depression, even more unfortunately is that today's politicians currently in the majority in Washington D.C. know nothing of history or economics. Governments cannot spend taxes from one segment of an economy to stimulate the entire economy, trying to do so worsens or lengthens recessions, or if in recovery leads to severe debt, higher interest rates and inflation when the recession ends. Look for the latter to come to America starting in 2010.

Locally, for me, in Long Beach, California there is some hand wringing and whining because of a report issued earlier this month from Senator Tom Coburn of Oklahoma. "100 Stimulus Projects: A Second Opinion" lists the top ten projects receiving ARRA funding that Coburn considers a waste of tax payer dollars, leading the list is a project in Coburn's home state for a waste-water treatment plant. The town already planned to build the project and applied for funds to help. In receiving $1.5 million in funding the town was ready to go, it was a "shovel ready" project. Unfortunately the funds also came with federal strings to the project that add 25% to the total cost of completion and increases the local residents utility bills by 60%. Thanks for applying.

What causes many in Long Beach to be upset with Coburn is listed at project number 96 is $620,000 for a skate park in our fair city. The skate park in question is already in existence in a park that is located in one of the poorer parts of the city where there are gangs and high crime. Local politicians and "community leaders" decry a Senator for Oklahoma of all places (the ignorance of bigotry rearing its big head) saying our city does not need this skate park! A meeting is being held! We need this skate park! All this is quite amusing in that, a) the funds have already been secured evidently so the funds will be coming anyway b) the City of Long Beach previously pulled funds for the skate park from the budget to zero complaints from any locals c) members of the Obama administration are on record as agreeing somewhat with the Coburn assessment saying the feel the project is not in the spirit of ARRA and d) the skaet park already exists! Yes the skate park that is receiving $620,000 in federal funds already exists, the money is not to build the skate park, but to make it more skate-parking with better ramps, bumps, and whatever will go into the design. This is not a waste of federal funds?

In the on-line and in bar conversations on the project I have asked two questions again and again and never received any answer: 1) How many jobs will the spending of the $620,000 create? 2) How long will those jobs last? Being asked by others is why it is costing over half a million dollars to pour some asphalt and shape it into humps, but that is for others to ask.

So why is a skate park renovation worthy of federal dollars when the local government deemed it not worthy of local dollars? Why the uproar? Half the people spewing venum at "that Senator for rural Oklahoma" on the blogs and comments of local websites have no idea the skate park already exists. My feeling is they see (R) after Coburn's name and therefore he must be bad, especially because he is from backward, hickville Oklahoma. But is this project really worthy of federal funds? Does it create jobs? Does it stimulate the economy? How many of those complaining about what Coburn as said have actually read his report? I have and here is a random sampling of projects that most people in Long Beach who support the skate park would (or should) decry as a waste of their tax dollars:

$150,000 for road signs in Illinois to announce that projects are paid for by stimulus funds--tax dollars to pay for signs to tell tax payers their taxes are being spent.

$5.5 Million to pay for a new factory in Georgia that will close a factory in Dayton and cost that town 1,200 jobs. Creating jobs by helping a corporation move and lay off currently working Americans. Your tax money going for more corporate welfare and costing Americans jobs.

$628,100 to Yale University, which has an endowment of $17 Billion to study if diet and exercise affect obesity.

$300,000 for a parking lot in a town in North Carolina that was in the local budget and ready to go. How many jobs does building a parking lot create? More or less than the amount needed to renovate a skate park?

$2.5 Billion for rural broadband, the funds going to the Rural Utility Services (RUS), which the Inspector General says is inefficient and wasteful in its use of funds--according to the Inspector General since 2005 90% of the loans approved by RUS have gone to communities that already have broadband.

$4.2 Million for Seapoose, Oregon (pop 6200) to raise the local railroad tracks eighteen inches to be level with the main road, despite local voters rejecting a bond measure to pay for this project--not good enough for local funds to be spent but good enough for the rest of America's taxes to be spent.

And on and on the list goes. Coburn picked just 100 of the projects in the ARRA totalling approximately $5.5 billion, and is taking heat in Long Beach and other communities across the country looking for the federal hand out. But if we look at what Coburn is saying in his report, as a United States Senator worried about American tax dollars and future debt obligations, he is right. The American Recovery and Reinvestment Act is $787 billion of wasteful government spending that in the end will create over $1 trillion in debt so skate parks and road signs and parking lots across America can be built. Beyond the actual funds being spent it is estimated that $55 billion will be lost in waste, fraud and abuse, not bad for a government program at less than 10%, but $55 billion nonetheless of your tax dollars being lost. According to Vice-President Joe Biden in early June, "Some people are being scammed already." I agree with the Vice-President, the scam started when the bill was passed, shoveling $620,000 to my city for park renovations just adds to it.

Is this the purpose of our Federal Government?

How Cities Should Manage the Next Foreclosure Wave

In February Governor Arnold Schwarzenegger signed into law a 90 day moratorium on foreclosures in the State of California. There were some loopholes, naturally, but the effect of the law was to keep tens of thousands of foreclosures from happening from the end of February through the end of this month, May 2009.

Since February we have seen an increase in the number of "short-sale" transactions (seller owes more in mortgages against the property than the sales price necessitating mortgagor(s) to discount principal owed to facilitate closing) as many homeowners have sold their properties ahead of filings of notices of default and foreclosure. As well California has seen a flattening of the median sales price through the first quarter of 2009, indicating a firming up of the housing markets through much of the state--particularly coastal counties and communities--from the bottom up. In some areas there has been an increase in median prices, particularly condominiums in some zip codes.

In part the flattening of the median prices and increase in the number of short sales versus bank owned foreclosures on the market in California are the result of the Governor's moratorium on foreclosures. With only a few weeks left before the moratorium expires what preparations have various California cities and counties and lenders undertaken for what will occur when that happens? My guess is nothing.

While the moratorium has allowed many lenders to off load poor performing mortgages through short sale transactions initiated by their borrowers, what the moratorium has not done is reduce the flow of borrowers into default on their mortgages. As a result lenders in California have a very significant number of mortgages on which they are about to initiate foreclosure proceedings. Three months of unpaid mortgages are going to start being processed by the banks and if not handled properly California housing markets will be hit with a flood of foreclosure sales due to the moratorium. The primary argument against the moratorium was what it would do to housing markets when the moratorium expires--we are about to find out.

Supply and demand function in any market, and left without interference will seek a market price for any good or service. Everyone with a basic concept of economics knows that scarcity of supply raises prices, scarcity of demand lowers prices, abundance of supply lowers prices and abundance of demand raises prices. For the past several months we have seen a growing abundance of demand in the lower price ranges and a flattening of supply, leading to stabilizing of home prices for the first time buyer markets. What happens to those markets when flooded with pent up supply due to banks being able to foreclosure again on delinquent borrowers? Abundant supply creates lower prices.

There is a possible solution to the flooding of the market with lender REO's (an industry acronym for Real Estate Owned, bank owned foreclosures) and the subsequent fallout in housing prices. Banks and local governments can work together to allow the banks to receive revenue from their REO properties while slowly placing their inventory on the market over period of a year or more and cities and counties can increase the supply of rental housing or moderate income housing for first time buyers.

Using Bank of America and the City of Long Beach as an example. Long Beach can approach Bank of America and determine how many properties they have in Long Beach that are REOs, in delinquency and about to be foreclosed upon. Understanding that BofA will need to remove the "toxic assets" off their books, BofA will continue with its normal foreclosure processes on delinquent borrowers. Understanding that the City of Long Beach is concerned with property values in its communities and the loss of tax revenues BofA will agree to work with the City to slowly sell its REO inventory over a period of twelve, eighteen or twenty-four months; slowly bleeding inventory on the market instead of dumping it all at once. For the properties that are not yet placed on the open market the City of Long Beach housing department can work with the BofA REO department to fill the properties with tenants paying fair market rent, perhaps subsidized (I cannot believe I wrote that word!) with funds from the housing department, to allow BofA to maintain funds for property taxes, insurance and general operating revenue (such as paying personnel in the REO department). Some of the properties can become eligible for funds from the housing department set aside for first time buyer programs that are currently not used due to inefficiency and requirements imposed on everyone involved.

Housing and government do not get along very well. Government imposition of requirements for low to moderate income families purchasing or renting housing creates hundreds of pages of restrictions and regulations and bottlenecks any funding to the point that no funding occurs. In the City of Long Beach there are millions of dollars in housing funds left unspent due to the requirements imposed on those funds being too stringent for the market to comply. If someone with sense in government, at the local, state and federal levels, were to look at the looming foreclosure flood about the hit the market in California he/she can see the problems that will occur. Yet under the guidelines imposed on housing funds there is nothing a city can do to manage the flood of inventory about to the open market in their communities. By re-negotiating the restrictions placed on housing funds from the state and federal governments cities can free up millions of dollars to use in working with banks so the inventory of REOs can be managed in a manner that helps both the banks and the communities where the properties are located.

From the bank's perspective the ability to forge a partnership with local governments to manage the removal of REOs from their balance sheets over time will add stability to their balance sheets, revenue to their income statements and groundwork for future partnerships that benefit both parties. Instead of having hundreds or thousands of properties on the market with declining values, they can have a few hundred properties at a time selling in a more stable market environment.

I do not expect this proposal to work as there is little chance the bureaucracy of the government housing departments can move nearly fast enough to free up the necessary funds from their current regulations that prevent their use. Cities across the country are flush with funds to promote home ownership and community development through rehabilitation of distressed properties--unfortunately the policies, procedures and regulations governing the funds make them useless. It is time for local governments to push back on Sacramento and Washington and renegotiate the terms under which those millions of dollars are being restricted.

Self-Filling Paychecks Crashing Local Budgets

The vast majority of California cities are doomed to financial failure in the near future because of the mandatory raises in salary given to the bulk of their employees and subsequent increase in pension payments. Imagine if you were guaranteed a raise in your salary every year and corresponding raise in your retirement pension with no regard to how well you do your job, all because your employer is worried you will go to work for your competition.

That is what happens with most of the municipal employees across the State of California. Here in Long Beach we hear the same refrains when contracts with various sectors of city employees are being negotiated: 1) We have to pay them more or they will go work for City "X" and 2) We have dedicated employees in the City who deserve our support.

Which is it? Are they dedicated to their jobs or are they mercenaries ready to bolt to Vernon or Bellflower or Santa Ana because the same position there is paying 3% more in base salary? They cannot be both, either they are loyal or they are in it for the bucks. Because almost none of our members of City Council over the years have any business experience, especially management and/or ownership experience, they believe the arguments. As a result our city employees have guaranteed raises in their contracts and when it comes time to renegotiate they are given raises framed in such a way at to appease only the most intellectually vapid among us: our employees are within 5%, 3%, 1% of the median for the sector in the region/state. Of course the employees in the municipalities against whom our employees' contracts are based are represented by the same union and of course have the same language in their contracts. As a result the unions, across several different city governments, have contracts guaranteeing perpetual raises for their members since the median income will always be going up.

Essentially every raise that occurs in any municipality in the state trickles through the system to enact raises for every other city due to a rising median salary and benefit package. If Alameda pays their General Maintenance Worker II's more money then when Richmond's contract renews their workers will get a raise to "stay competitive" and so it trickles down the state, Fresno, San Louis Obispo, Glendale, Bell, Long Beach. And by then when Long Beach gets their raises it will trickle back up to Alameda in time for them to get their new raises.

Keeping in mind how difficult, damn near impossible, it is to fire any employee with union representation, these employees are guaranteed the salaries regardless of productivity, efficiency or any standard of job performance. Further, it includes payments into their pension plan--which is the real budget killer.

As residents we are subject to attempts at blackmail by management telling us, if we do not give these raises and "stay competitive" we will lose our best and brightest to a neighboring city who is paying their employees more. Really? In this economic environment Carson, El Monte or Aracadia are going to bring in new employees to replace existing employees who are what retiring? Being fired? Because they have money in their budgets to hire more General Maintenance Worker II's or Division Budget Analyst Managers?

If anyone decides to leave the guaranteed employment, guaranteed salary--which is quite generous given the lack of performance requirements that can lead to dismissal--and guaranteed pension for a few bucks more, I say let them. Let them go. Here in the private sector we often do, sure go to the suppossed greener pasture, leave stability and venture into the unknown. Employees know this is the case and because of that do not play chicken for pay raises. There is a bottom line to company profit and sustainability, if giving you a raise just to keep you jeopardizes that then good luck at your next place of work if you choose to go. Further, if you cannot justify your raise with corresponding increases in profit, decrease in other expenses, productivity or other measurable output then you will not get one. Try that with a city job.

So if employees in negotiations say, "We can go to ______ (fill in city of choice here) for more pay, I say let them try it. For one we can use the job loss on the city income statement. But more importantly it is a bluff. If we do not give our cops a big pay increase, or our firefighters or our City Hall employees, we will not be seeing any job exodus. When city management uses this argument it is tatamount to me telling my children to go to bed or the Bogeyman will get them.

Currently the City of Long Beach has ninety-four former employees drawing over $100,000 per year in pensions from CalPers for a total of over $11.25 million per year. Guess where that money came from? Not the employees but from the tax payers. Instead of building a new library City Councils past handed out pay raises. Instead of fixing streets or sewers City Councils handed out retirement benefits based on last salary. Instead of protecting the city infrastructure our elected officials and city managers padded salaries, particularly for those groups most active in campaign donations for local and state elections. With each new series of raises comes a series of pension contributions that are that much higher, that drain that much more from city coffers, that creates that many more retirees in the $100k club. Meanwhile the rest of us pay into our own 401(k) with limited company contributions--mainly due to federal tax limitations--and keep pushing back how long we will have to work before retiring.

The City of Long Beach, and other city governments across the state, must stop the spiralling salary increases that feed off each other. Call the employees' bluffs that they will leave their current jobs in search of more pay elsewhere, I say good luck matching what you have now. There is a reason employees in the private sector stay with the same companies for decades: loyalty, steady employment and fairness by both sides.

Finally regarding the pensions Long Beach and other cities need to renegotiate with every group and individual. Retirement benefits should not be set on an employee's last year, or six months, of employment but rather be based on the median income of the last five or seven years. Each employee must pay into his or her retirement account as we do in the private sector. Finally, if an employee leaves before five years they only carry a portion of the city contributions with them.

It is time for our elected officials and senior city management to quit playing us for fools, and time for the electorate to quit being played. Take control of the spending which is 80% of the budget: salaries and benefits. Quit worrying about losing employees and start worrying about saving money for today and into the future. Start acting like employers who care about the long term survival of our city and not like politicians worried about your next campaign donations.

Political Calculus

There are those who follow politics the way others follow baseball and box scores, there are hits, runs and errors. These days in the City of Long Beach, and the State of California, one needs not a box score but a calendar. For any politician, or anyone thinking of becoming a politician in Long Beach, a calendar is the most important tool in the box; well besides financing from unions.

Term limits are the root cause of our state's political and budgetary problems. While term limits in the city create problems locally, even our city budget issues can be traced directly to the term limits for elected officials in Sacramento. Enacted in 1990 by voters, primarily to get then Speaker Willie Brown out of office, members of the State Assembly are limited to three terms of two years each and members of the State Senate are limited to two terms of four years each.

Further compounding the problems caused by term limits on the state level has been the drawing of legislative districts that create "safe seats." In the last election voters passed one of the few worthwhile propositions we have seen in the past two decades, Proposition 11 took the ability to redraw legislative districts out of the hands of the legislature and gave the power to a panel appointed by a commission of auditors. If the Prop 11 re-districting commission works as voters hope then after the 2010 census our state's legislative districts will be redrawn to more accurately reflect population and geographic boundaries than political party boundaries. However, big however, the changes will not be in effect until the 2012 state elections at the earliest.

Virtually every seat in the California Assembly and California Senate is a "safe seat". Our Bixby Knolls abode sits in the 55th Assembly District and the 27 Senate District, it does not really matter who the elected representatives are because they have been and will be Democrats due to the districts each being over 65% registered Democrat. So while we have term limits for those currently in office, what we have is a revolving door of the same person in a different body always in the Assembly and the Legislature.

Everyone knows when a seat will become available, and everyone knows who will get elected. In all but 3 of the Assembly and Senate seats whoever has a (D) next to their name on the ballot in November will win the election. In the other seats the winner of the Republican primary will win the election. So if you live in the Bixby Knolls area your Assembly representative, Wayne Furutani who was elected in a special election in 2008 will be leaving office in 2016 (finish his special election term then finish his two terms under term limits).

Of greater interest locally is when will Bonnie Lowenthal be termed out of office following her election to the State Assembly in 2008? Following her re-election in 2010 (and with the safe districts how can she not?) Lowenthal is termed out of her seat. And already individuals are lining up to take a run at her seat which overlaps parts of the both the Long Beach 1st City Council District and the Long Beach 7th City Council District. If my map reading and knowledge of home addresses is correct, this confluence of term limits and current district boundaries presents a 2014 showdown between two very bright up and comers in the Democratic Party.

Earlier this month Robert Garcia ran a perfect campaign on the Obama blueprint and won a special election for the Long Beach 1st Council District (filling the seat vacated by Bonnie Lowenthal). Garcia was attacked by the local Democratic Party because he is a "newcomer" to the party, but make no mistake Garcia's politics are very aligned with the Democratic majority in the region. Everything about Garcia makes him star material for the Democrats, born in South America, immigrating with his parents as a young child, received amnesty under President Reagan, left the Republican Party, Hispanic, homosexual, working on a PhD, incredibly bright and articulate and handsome to boot; Garcia is a great political package and he has a political future beyond the Long Beach city council. Garcia will be finishing his first term, presuming he wins his re-election in 2010, which he will by landslide, when Lowenthal is termed out of office in 2014.

Further uptown Long Beach City Council 7th District Representative Tonia Reyes Uranga is being termed out of office in 2010 and her husband Roberto Uranga was a stated and obvious candidate to keep this seat under family control. Uh, not so fast. You see the 1st District is not the only geographic area of the state with young, intelligent and political savvy individuals. A few days after Garcia won the election for the 1st District, James Johnson announced his candidacy for the 7th Council Seat in 2010.

Johnson gets a complete breakdown of his experience in the City of Long Beach on the Long Beach Report, while I am generally not a huge fan of the site's primary contributor his history on Johnson taken in context is pretty thorough. Johnson is very intelligent and also a rising star in the Democratic Party. He apparently is also good at math as if he wins the 7th District Council seat he will be ending his first term when....Bonnie Lowenthal is termed out of office.

Now there is a chance that the 54th Assembly District Boundaries could be redrawn before the 2014 election, but with the natural border of the 710 Freeway on the western edge of part of the district any redrawing will probably include the home bases of both Garcia and Johnson. Looking beyond the Assmebly both are in the same California State Senate District as well as the same Congressional District.

Because of term limits both these intelligent young men know what is avaiable politically in 2014, know their best chance of winning the prize of the Assembly is to have experience on the City Council to help boost their fund raising and friend making, and know that even with re-districting their district will not change much demographically--it will still be solidly Democrat. Further, both being bright they know that incumbents within the party are extremely difficult to beat so they must win in 2014 to continue their political futures.

So sports fans, grab some popcorn and a lawn chair. The race for the 7th District Council Seat in Long Beach is a race for much more than just that seat. Due to political calculus and term limits it is also a race to set up opponents in 2014 between two of our city's brightest young men with equally bright political futures...potentially.

Coyotes in Bixby Knolls...What To Do?

There are morning people and there is the rest of the world. Morning people often like to start their day off by themselves, enjoying their solitude as their part of the world wakes up around them. Some morning people welcome the new day dawning with a walk or jog through their neighborhood. Listening to their steps and the rhythm of their pace blending in with the twittering birds coming alive in the trees over head, a semi-meditative state allows the morning person to plan his day, write his correspondence, contemplate his purpose in life and pray for guidance in the decisions that lay ahead.

If you neighborhood is like the neighborhoods I have lived in over the years most of your early morning inhabitants are solitary creatures; solo walkers and joggers easily outnumber those in pairs by a factor of five or six to one—not counting those with canine companions. And so it has been with me for many years as I naturally awaken before dawn, put on the coffee, take about ten to fifteen minutes for an inspirational read, and grab a cup of coffee and the leash—time for the dog to take me for a thirty to forty minute walk.

Imagine you are a morning person, if you already are one Good Morning!, and you are on your daily routine quietly keeping pace on your standard route when you come across a predatory wild animal. Now imagine instead of coming upon not one coyote but two. Yikes! If you have a pet on a leash you quickly run through the options, keep him on the leash so you can drag him out of a fight, but that may lead the coyotes to you, let him off the leash so he can run, but that may doom him to the pair ganging up on him, take him off the leash and use the clip as a weapon you can swing and hit with if need be, pour hot coffee on their heads. You come to your senses, stop walking and very slowly and carefully back away until you are a safe enough distance away to quickly make it home.

You passed the first test of what to do when you spot a coyote in your environment: do not engage and quickly exit the immediate area. But now what? Now that you are home what are you to do? I put this question and more to John Keisler who is the Bureau Manager for the City of Long Beach Animal Care Services after spotting two coyotes who appeared to be stalking/hunting what I presumed to be a cat near the corner of California and Claiborne on Wednesday morning just before dawn (about 5:50 a.m.) as I was walking Harrison. Fortunately we were still a block and a half away when the yelping and barking alerted me to their presence and we were able to turn back without being noticed by the coyotes.

Keisler told me that our neighborhood, bordered by Atlantic on the West, San Antonio on the North, Orange on the East and Carson on the South, has been very active with coyote sightings and reports—he knows because they track them from calls (562-570-PETS <7387>) and entries on their website where they have a coyote incident form residents can complete (here).

What should I do if I spot a coyote or two in my neighborhood? Who should I call? If you spot the animal(s) outside of Animal Control’s regular hours and call their number (562-570-PETS or 7387) it is forwarded to the Long Beach Fire Department. If it is a life or injury threatening emergency they will send assistance.
What if it is not life threatening, I want to report the animals and have them removed from our neighborhood?
Animal Control’s ability to trap and/or kill coyotes is restricted by state law and is under the guidance and governance of the Department of Fish and Game. If coyotes are spotted under “normal” circumstances, which means pre-dawn or post-dusk when they are most active and hunting for food, animal control will not and cannot pick up the animals unless there is the threat of personal injury or risk. If coyotes are spotted roaming during daylight hours, which is considered unusual, then Animal Control can trap them—however state law mandates that the animals are released in proximity to where they were trapped.
In other words, there is not much residents can expect from Animal Control in terms of removal of coyotes from their neighborhood.
Correct, because of the state law limits the terms under which coyotes can be trapped or killed, unless a very unusual circumstance is occurring residents must find a way to share their neighborhood with the wild animals that sometime inhabit the area.
What are my risks as a resident, a parent and as a pet owner?
(I told Keisler we have a collie) Since your dog is pretty good size most coyotes will avoid him and not want to engage—they are after smaller and easier prey like rats, mice, birds and cats if they are hunting. Also humans are fairly safe as long as they do not attempt to interact with the coyotes. Coyote attacks on humans are very rare (website here indicates that this is not so much the case any more with three attacks on children in California in 2008. While most of the attacks have occurred in newer developments on the “edge” of natural habitats, as coyotes in urban areas like Long Beach become more accustomed to humans the chances of attacks increase).
Why are the coyotes in my neighborhood?
They are looking for food and the easier the better. Feral cats are a prime target, as are small dogs and other pets left out of the home at night. A primary source of food for all roaming animals is trash cans—if the coyotes do not raid the open containers then feral cats may be attracted to them, which in turn draw the coyotes; it is like a buffet for them.
How long will they be around?
Depending on the food supply most coyotes move on after a couple of weeks, however the ones in your neighborhood have been there for a while longer. Your neighbors have been very good about documenting the sightings.

Keisler was very informative and I am grateful for his time. What I took away from the conversation was a few items. First, to those who insist on maintaining outdoor cats and feeding feral cats—you are just setting them up to be coyote bait and by keeping them you are luring them into a neighborhood with children and responsible pet owners. Bring the cats inside or be prepared to lose them to our wild animal residents--deservedly I will add.

Second, neighbors who leave their trash containers open, like these two on the alley between California and Myrtle just north of Tehachapi (one block south of where I spotted the coyotes last week) who always leave their containers open so they can just drop their trash bags over the fence, are inviting the coyotes into the neighborhood. The irony on these two families is they both have dogs and are inviting predators to come and possibly attack them with their irresponsible behavior in regards to their refuse containers.

Third, the protection of the coyote as a wild animal in a long established residential area takes precedence over the protection of the residents from attack from the coyotes per state law; I am sure there are some who agree with this policy and some who disagree with it--either way it is the policy and Long Beach Animal Control must abide by it.

It is resident beware. Make sure if there is coyote activity in your neighborhood you alert your neighbors, take care during non-daylight hours as to your pets and children, and encourage your neighbors to not leave out over night pets or pet food and to make sure refuse containers are properly secured. One advantage of our coyote prowlers is there will certainly be a decrease in feral cats using our gardens as litter boxes and spreading fleas and other diseases to our pets--for every cloud there is a silver lining.