HomeMy WebLinkAbout10 - Orange County Grand Jury Response - Transparency.pdfSEW p w
CITY OF
as NEWPORT BEACH
�q��oP City Council Staff Report
Agenda Item No. 10
October 9, 2012
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: City Manager's Office
Dave Kiff, City Manager
949 - 644 -3002, dkiff @newportbeachca.gov
PREPARED BY: Dave Kiff, City Manager
APPROVED:
TITLE: Response to the OC Grand Jury — "Transparency Breaking Up
Compensation Fog — But Why Hide Pension Costs ?"
ABSTRACT:
The City of Newport Beach (City) is obligated to respond to a recent Orange County
Grand Jury report on transparency of pension and other costs. The response is due by
October 12, 2012.
RECOMMENDATION:
Authorize the Mayor to send the attached response to the Presiding Judge.
FUNDING REQUIREMENTS:
There is no fiscal impact related to this item.
DISCUSSION:
Please see the attached draft response.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this action is not subject to the California
Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will
not result in a direct or reasonably foreseeable indirect physical change in the
environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378)
of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it
Response to the OC Grand Jury — "Transparency Breaking Up Compensation Fog — But Why Hide
Pension Costs ?"
October 09, 2012
Page 2
has no potential for resulting in physical change to the environment, directly or
indirectly.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
Submitted by:
1!�n 0.
Oa�e Kiff, City M nager
Attachments: A. Proposed draft response to the Grand Jury
B. Grand Jury Report
4
Response to the OC Grand Jury — "Transparency Breaking Up Compensation Fog — But Why Hide
Pension Costs ?"
October 09, 2012
Page 3
October 10, 2012
The Honorable Thomas J. Borris
Presiding Judge of the Superior Court
700 Civic Center Drive West
Santa Ana, California 92701
RE: Report of the Orange County Grand Jury — "Transparency Breaking Up Compensation Fog — But Why
Hide Pension Costs ?"
Dear Judge Borris:
The attached is the City of Newport Beach's formal response to the above -noted Grand Jury Report.
If you or any members of the Grand Jury have questions about our response, please do not hesitate to
contact City Manager Dave Kiff at dkiffC@newoortbeachca.aov or 949 - 644 -3001.
Sincerely,
NANCYGARDNER
Mayor of Newport Beach
Response to the OC Grand Jury — "Transparency Breaking Up Compensation Fog — But Why Hide
Pension Costs ?"
October 09, 2012
Page 4
RE: Response to a Report of the Orange County Grand Jury titled "Transparency Breaking Up
Compensation Fog — But Why Hide Pension Costs ?"
FROM: City of Newport Beach, California
DATE: October 9, 2012
The Grand Jury's recent report, "Transparency Breaking Up Compensation Fog — But Why Hide Pension
Costs ?" obligates the City of Newport Beach (City) to respond no later than October 12, 2012 to:
• Findings 2, 3, 4, and 5; and
• Recommendations 2, 3, 4, and 5.
City Manager Dave Kiff was instructed to respond to the report on the City's behalf. His comments
follow.
FINDINGS
Finding 2 — Content and Clarity Ratings for EXECUTIVE Compensation Cost. Twenty of the thirty-four
cities were rated good, average, poor and nonexistent for Executive Compensation Cost Content and
Clarity, all of whom could improve to excellent.
Response: We agree that we can improve the provision of this information.
Finding 3 — Content and Clarity Ratings for EMPLOYEE Compensation Cost Ratings. Twenty -nine of the
thirty-four cities were rated good, average, poor and nonexistent for Employee Compensation Cost
Content and Clarity, all of whom could improve to excellent.
Response: We agree that we can improve the provision of this information.
Finding 4 — Many Orange County local government web sites do not generally post their employer
pension annual contribution rates prominently to their web sites as part of their compensation cost
disclosure for public disclosure.
Response: We agree that this information is not easy to find on our website, and that can be improved
fairly easily.
Finding 5 — Two key categories are missing from compensation cost reporting. They are overtime pay
and on -call pay.
4
Response to the OC Grand Jury — "Transparency Breaking Up Compensation Fog — But Why Hide
Pension Costs ?"
October 09, 2012
Page 5
Response: We agree that this information is not easy to determine, but it also varies significantly person
to person and year to year. It might be easier to post a year in arrears rather than in the current year.
RECOMMENDATIONS
Recommendation #2 — The City should upgrade its executive compensation page, with a particular
emphasis on pension costs.
Response: This recommendation has not been implemented, but will be implemented in the future,
within roughly six months.
Recommendation #3 — The City should upgrade its employee compensation cost pages, with o particular
emphasis on pension costs, overtime pay, on -call pay, and expanded descriptions."
Response: This recommendation has not been implemented, but portions of it will be implemented in
approximately six months. It may be challenging to include overtime pay and on -call pay by specific
individual, given that these numbers change frequently, and can vary year to year. The City will examine
ways to provide this information.
Recommendation #4 — The City should post its employer pension annual contribution rates prominently
and transparently on their websites.
Response: This recommendation has not been implemented, but will be implemented in the future,
within roughly six months.
Recommendation #5 — The City should include overtime pay and on -call pay in compensation cost
reporting on their employees' compensation pages.
Response: As noted in our response to Recommendation #3, the City will examine ways to provide this
information in a relevant and timely way. As of the date of this response, this recommendation requires
further analysis to examine whether current year or past year information is regularly reportable, and
whether the City's current software system could effectively provide it. The analysis will be completed
within six months.
If the Grand Jury has any questions or concerns about this response, please contact City Manager Dave
Kiff at 949 - 644 -3001 or dkiff @newportbeachca.gov
5
700 CIVIC CENTER DRIVE WEST • SANTA ANA, CALIFORNIA 92701 • 714/8343320
www.ocgrandiury.org • FAX 714/8345555
June 7, 2012
Nancy Gardner, Mayor
City of Newport Beach
3300 Newport Blvd.
Newport Beach, CA 92663
Dear Mayor Gardner
Enclosed is a copy of the 2011 -2012 Orange County Grand Jury report, "Transparency Breaking Up Compensation Fog -
But Why Hide Pension Costs?" Pursuant to Penal Code 933.05(f), a copy of the report is being provided to you at least two
working days prior to its public release. Please note that, "No officer, agency, department, or governing body of a public
agency shall disclose any contents of the report prior to the public release of the final report." (Emphasis added.) It is
required that you provide a response to each of the findings and recommendations of this report directed to your office in
compliance with Penal Code 933.05(a) and (b), copy enclosed.
Please distribute this report to your governing body.
For each Grand Jury recommendation accepted and not implemented, provide a schedule for future implementation. In
addition, by the end of March of each subsequent year, please report on the progress being made on each recommendation
accepted but not completed. These annual reports should continue until all recommendations are implemented.
Please mail the response to the recommendations to Thomas J. Burris, Presiding Judge of the Superior Court, 700 Civic
Center Drive West, Santa Ana, CA 92701, with a separate copy mailed to the Orange County Grand Jury, 700 Civic Center
Drive West, Santa Ana, CA 92701, no later than 90 days after the public release date, June 14, 2012, in compliance with
Penal Code 933, copy attached. The due date then is October 12, 2012.
Should additional time for responding to this report be necessary for further analysis, Penal Code 933.05(b)(3) permits an
extension of time up to six months from the public release date. Such extensions should be advised in writing, with the
information required in Penal Code 933.05(b)(3), to the Presiding Judge of the Superior Court, with a separate copy of the
request to the Grand Jury.
We tentatively plan to issue the public release on June 14. Upon public release, the report will be available on the Grand Jury
web site (www.oc2randiuri-mre).
Roy B. aker 111, Foreman
2011 012 ORANGE COUNTY GRAND JURY
Enclosures
Grand Jury Report
Penal Code 933,933.05
cc: City Manager
COMPENSATION COST TRANSPARENCr
TRANSPARENCY BREAKING UP CO
- BUT WHY HIDE PENSION COSTS?
Compensation Cosl Transparency for Orange County
Cities, Districts, Joins Power Authority and County Government
This country prided itself on openness and yet, it wasn't open. It's still not open.
And a_H we're tryine to do is let people know how their money is beine scent
Brian Lamb. C -SPAN Founder At CEO
SUMMARY
The 2010 City of Bell compensation revelations2 stimulated the public's interest in local
government compensation costs. The quest for more compensation transparency from local
governments was intensified by the following factors:
• Financial and housing markets' extensive downturns impacted governmental tax bases
and fanned public anxieties;
• Public services came under financial strain throughout Orange County;
• Public awareness and dialogue increased about the financial impacts of government
guaranteed pensions;
• Size of unfunded public sector pension liabilities generated concerns among both workers
and taxpayers.
In 2012, new upcoming Government Accounting Standards Board (GASB) standards may be
issued. They will spotlight the amounts of unfunded pension liabilities officially on local
governments' 2013 balance sheets. Press coverage will spark public dialogue about the ability to
meet pension obligations to public sector employees.
Last year's Orange County Grand Jury, the Orange County Register, State Legislature and State
Controller, among others, suggested guidelines and requirements for local government
compensation transparency. The 2010 -2011 Orange County Grand Jury issued specific
guidelines in 2011 to local governments for reporting compensation costs.
The 2011 -2012 Grand Jury decided to follow up on the implementation status of the 2010- 2011's
recommendations. The Grand Jury wanted to recognize the progress made in each Orange
County city, special district, joint power authority and the County.
' NPR lzomitworasfe• Lsmb.3i212012. htir %mN mx. x2012 03 21 149MM7 after -3a -% cars -N0h - span- hrun- IamM�L -doNn
'Los Angeles Times. `Nigh Movies Stir 0"s, in Bell" spring 3010 series, htlya. uwN.Igyn� corn ucws Iowl'hcll
2011 -2012 Orange County Grand Jury Page 1
!�Illl
COMPENSATION COST TRANSPARENCY
The 2011 -2012 Grand Jury assessed how well Orange County local governments reported
compensation costs for all employee positions, in one easy -to -find, easy -to -read chart Also
reviewed was the top -level compensation cost chart for all elected officials and executives over
$100,000 in base salary, as recommended in 2011
This study found that compensation cost transparency is improving in Orange County local
governments. That is a good trend, but much more improvement is needed In addition, this
study tound that with a few notable exceptions, complete pension costs for employees are still
hidden from public view.
The 2011-2012 Grand Jury recommends that Orange County local governments .should upgrade
their websites to provide complete cost transparency of precise salary and benefits at all levels.
in an easy to read table format
The 2011 -2012 Grand Jury recommends that governmental costs jar funding pensions for each
employee should be brought out of the shadows and made transparent These costs should be
reported by each Orange County government on its website as part of employee compensation
cost reporting. The governmental annual costs of funding pensions are important and significant.
For Orange County local governments, their pension annual funding costs for employees on
the current payroll range from:
• 9% to 28% of salary for a general employee;
• 10% to 48% of salad, for a public safety employee.
REASON FOR STUDY
Transparency is a hallmark of good government.
The United Nations defined transparency as one of the eight characteristics that the UN
Economics and Social Commission use in its explanation of good governance.3 Transparency
..means that information is freely available and directly accessible .
It also means that enough information is provided and that it is provided in easily understandable
forms and media "4
Within a democracy, "Compensation Cost Transparency" (CCT) can provide the public with a
check and balance mechanism for ensuring appropriate levels of government employee pay and
benefits remuneration.
' llne other 7 cbaraderistics are 1) Participation. 2) Rule of law 3) Rcspewiveness 4) (:onacrosua oricnted S) Equity & Inclusiveness 6)
ERcdivaness & afLciency and 7) Accowrtability
I N Economics and Social Commission see page 3 of p_ugescan rxe ndd fns ProromAa iv Ia ( )i)amgyggovcmance.aen
2011 -2012 Orange County Grand Jury Page 2
COMPENSATION COST TRANSPARENCY
Peter Finn, the Washington Post grand prize winner of the RFK Journalism Award, stated it well,
when he said: "A havic tenet oja healthy democracy is open dialogue curd transparency. "J In
California, the top elected financial official, John Chiang, California State Controller stated:
"Holding public officials accountable for how they manage public dollars relies heavily on
transparency. '-6
Last year, the 2010 -2011 Orange County Grand Jury reported:
1) On"... a disturbing level of inconsistency in the degree of transparency pertaining to OC
Cities' compensation information which was then provided to the public;
2) "7hat the degree of transparency then provided to the public by the County of Orange
regarding compensation information was inadequate in its accessibility, content and
clarity; "" and
3) "Wide variations among the water and sanitation districts studied in the ability of the general
public to obtain compensation, financial and meeting information. As a result, the Grand
.hiry recommended minimum standards for information on water and sanitation district
websites. "9
The 2010 -2011 Orange County Grand Jury recommended a model for use in reporting municipal
and county compensation costs. Such information was recommended to be made readily
accessible on the Internet websites of all Orange County cities and the county respectively, as
soon as practical.
The 2010 -2011 Orange County Grand Jury recommended that the Orange County water and
sanitation districts provide compensation data for the board of directors and general manager, as
well as current budget and financial reports. The data was recommended to be in an easily
accessible format on each district's website.
During that same fiscal year, and effective November 1, 2010, the California State Controller
requested local governments to report salary and benefit information for all employees /positions.
The content of the State Controller's website posting of cash compensation by employee has a
different focus than that of the Orange County Grand Jury. Some major benefit amounts paid by
the local government are not requested by the state and no salary and benefit total is rendered.
' Peter Finn. Washington Post. see hten H".% brani,uuulc vin IHml
"John Chiang California State Controller, nacember 12, 2011. aec hnp_ ,wivwscn cjjLov co cssel 11227.Inm1
' "Convenrarion Srrdr of Orange Cowry Grier,'• 2010.2011 Change County Gmnd Jury Final Report, Summary, p. 117.
�.„ w Wx dho ant
i "ComW ojOrante Compenrarion Dirdorwre." 2010.2011 Orange Couny Grand Jury Final Report. Summary, p. 107,
N NN.pCAffdJil(�'.�I[g_ e t f ant
a "Compman on ojOnWe count' Wows and SonOalion Dietrich." 2010.2011 Grange Coumy Grand Jury Final Repent, Summary. p. 161.
•.iuu S�It16fldlun,YlG ISCW.ILB!0
2011 -2012 Orange County Grand Jury Page 3
COMPENSATION COST TRANSPARENCY
The 2010 -2011 and 2011 -2012 Grand Juries request disclosure of the government's costs of total
compensation by employee/position. One example is the Grand Jury's inclusion of annual
pension contributions by governments to honor future benefit promises to the employee, which
the State currently excludes. In the future, Orange County local governments could be more
efficient, if these two perspectives would merge to become one.
The 2011 -2012 Orange County Grand Jury decided to do a follow -up study to recognize those
Orange County governments that had embraced the full spirit of "Compensation Cost
Transparency" (CCT) at the local level. The Grand Jury wanted to spotlight those who had not
yet gone beyond the bare minimum requested by State Controller mandate. The compensation
cost study should extend beyond just the water and sanitation districts to the Orange County joint
power authorities and other Orange County special districts.
What is "Compensation Cost Transparency" (CCT)? It is instructive to compare "Compensation
Cost Transparency" (CCT) to just "Compensation Transparency CCT makes visible for all
citizens and taxpayers the government's annual costs of an employee's salary and benefits.
Compensation transparency focuses just on the current salaries and benefits received in the
current year by the employee. The difference is often due to the government costs of funding
future benefits, like pensions, or deferred compensation.
One example is the required funding of annual contributions to a pension investment pool. The
government's contractual pension obligation is a future benefit for the employee. This
compensation cost is not a current benefit for the employee. However, funding the future
pension obligation is a current compensation cost for the government for employing that
employee now. CCT provides a more complete view of the cost of employing an individual than
does just compensation transparency. This report will use the acronym "CCT" to improve the
readability of the text and flow of ideas for the reader.
METHODOLOGY
The 2011 -2012 Orange County Grand Jury used the following process to assess CCT at the
websites of Orange County cities, special districts, joint power authorities and county
government. See Appendix E on the last 2 pages of this report for more detail.
• Reviewed:
• Thee 2010 -11 Orange County Grand Jury compensation reports;
• The 54 county, city and special districts responses. ltl
° 54 responses from 53 entities as 2 rosponscs (a majority & minority response) were received from IAgmu Hills.
2011 -2012 Orange County Grand Jury Page 4
10
COMPENSATION COST TRANSPARENCY
as Discussed responses with selected local governments and followed up to obtain overdue
responses;
as Expanded:
• The study from 53 to 58 local governments, by including eight additional special
districts and joint power authority and dropping three;
• The study to include all employees;
• The web assessment rating criteria to define objective and precise criteria.
o Corresponded with Orange County local governments to be studied;
is Reviewed, documented and assessed the transparency and the combined content and
clarity of Orange County local governments' web site multiple times;
is Researched CalPERS and OCERS annual pension contribution rates required of Orange
County local governments;
as Discussed with the California State Controller Office's Bureau of Local Government
Policy & Reporting to understand their plans for issuing expanded local government
compensation reporting requirements within the state;
ts Compiled data, charts and assessments from documentation and web reviews;
as Analyzed the compiled facts and data to develop findings and recommendations to draft
this study report.
I ZT40 10
Fact — The County of Orange is the sixth most populous county in the United States and third
most populous in the state of California. A population of 3.1 million persons resides within an
area of almost 800 square miles. The County of Orange government has a budget of $5.5 billion,
of which only $686 million is for general purpose discretionary revenue. The government of the
County of Orange had 17,655 authorized employee positions in 2010 -2011. That number is in
addition to the employees in the other 57 local governments within Orange County that were
studied-"
Fact — The 34 incorporated cities in Orange County range in population from over 6 thousand in
Villa Park to over 350 thousand each in Anaheim and Santa Ana. 12 All cities have elected city
councils and an appointed city manager /CEO.
Fact — Seventeen water and/or sanitation districts are in Orange County, fifteen of which have
web sites. 13 At the lower end of the range, their revenues range from more than $300 thousand
for the Rossmoor/Los Alamitos Area Sewer District to more than $900 thousand for the Sunset
Beach Sanitary District. In the upper range of revenues are the:
The facts in this paragraph were sourced from 2011 Fact d Fglwes county of (range. 2011.
"Ibid.
Sunset Beach Sanitary District dots not have a web site and the Rossmooc7us Alamitos Mu Sewer District recently chow to discontinue their
web situ due to now State legislation requvemcrau.
2011 -2012 Orange County Grand Jury Page 5
11
COMPENSATION COST TRANSPARENCY
• Municipal Water District of Orange County (MWD of OC) with $135 million;
• Orange County Water District (OCWD) with more than $155 million;
• Irvine Ranch Water District (IRWD) with more than $205 million;
• Orange County Sanitation District (OCSD) with $600 million.
Fact — One Orange County transportation district included in this study has the following budget.
• Orange County Transit Authority (OCTA), with a budget of $1.1 billion.
Fact — One joint power authority in Orange County included in this study has the
following budget.
Orange County Fire Authority (OCFA), with a budget of $282 million
(before the addition of Santa Ana);
Fact — Six non - enterprise special districts in Orange County with web sites were studied. Special
districts are categorized as "enterprise districts" (those that sell products) or "non- enterprise
districts" (those that only provide services).
The smallest, Silverado - Modjeska Recreation and Parks District, had revenues of $93 thousand,
while the others have revenues in the millions. The other five are the:
• Rossmoor Community Service District, with revenue of $1.7 million,
• Buena Park Library District, with revenue of more than $2 million;
• Placentia Library District, with revenue of more than $2 million;
• Orange County Cemetery District, with revenue of $3.7 million;
• Orange County Vector Control District, with revenue of $10.3 million.
Fact - As of November 1, 2010, the California State Controller announced new requirements for
California local government entities (city, county and independent special districts) to report
their government salary and compensation data annually.
Results are at %vww_sco ca /gov!compensatioil search html or httpJ /h cr.sco ca oy //.
The focus of the State mandated reporting system is on current compensation and is different
from that recommended in this report or the 2010 -2011 Orange County Jury compensation study
reports. The latter focuses on the government's total cost of employee compensation, including
funding future benefits, like pensions.
Fact — Most, but not all, of the Orange County government entities described above participate in
either the California Public Retirement System (Ca1PERS) or the Orange County Employees
2011 -2012 Orange County Grand Jury Page 6
12
COMPENSATION COST TRANSPARENCY
Retirement System ( OCERS) for their employee's guaranteed pensions. f" Guaranteed pensions
are called defined benefit plans (DBPs). DBPs guarantee the employee a specific pension upon
retirement, regardless of agency financial conditions at the time of retirement.
These guaranteed pensions are funded by the respective governments through investment
contributions to CaIPERS or OCERS. CalPERS and OCERS invest the monies. When
investment returns fall short of the amount needed, the government entity often needs to increase
pension funding investment contributions. In the case of the cities and counties. the pension
obligation is backed up by the taxpayer, and is a direct taxpayer obligation.
ANALYSIS
The local governments of Orange County, cities, special districts and joint power authorities
have established and used their Internet web sites as an easy, efficient and effective way of
communicating with the public. These website postings have provided a communications
foundation to build transparency in government.
The 2010 -2011 Orange County Grand Jury recommended that all cities and the county
government in Orange County report their compensation information to the public on the
Internet in an easily accessible manner.
A Compensation Disclosure Model was included in the 2010 -2011 Grand Jury reports. That
model provided sample items to be included in determining total compensation. For the county,
the positions to be reported included all elected officials, plus department heads. For cities, the
positions required to be reported included all elected officials, plus all employees earning a base
salary rate over $100,000 per year.
The county and a majority of the cities started displaying salaries and benefits for all positions on
their web sites. However, the entire dollar salary and benefit information requested was not
always displayed. Subsequently, the 2011 -2012 Grand Jury concluded that the overtime and on-
call pay items should be added to compensation reporting when extending the reporting to all
employees (particularly for public safety employees).
A new "de facto" standard was established when most local Orange County cities' web sites
began to show compensation in some fashion for LdJ employee positions, not just the executive
levels. This was done for full disclosure in light of the City of Bell compensation scandal, the
Grand Jury recommendations and the California State Controller's new local government
compensation reporting requirements.
" El Two Water District, among others, does net offer a Defined Benefit Plan, and some plant are not affiliated with Ca1PERS or OCERS.
2011 -2012 Orange County Grand Jury Page 7
13
COMPENSATION COST TRANSPARENCY
Likewise, the 2010 -2011 Orange County Grand Jury recommended transparency guidelines to
the water and sanitation districts. These districts were asked to provide data on compensation for
the board of directors and general manager, as well as current budget and financial reports, in an
easily accessible format on the district's website.
Special districts and joint power authority that had not been specifically studied by the Orange
County Grand Jury had the opportunity to observe clearly what was evolving for local Orange
County city governments. The State Controller's office was requiring compensation
transparency, as well. Compensation cost transparency (CCT) for all employees was being
recommended for Orange County local governments with displays on their websites.
The 2011 -2012 Orange County Grand Jury assessed the CCT of Orange County local
government websites in the following three categories for 2012:
1. Accessibility —Are transparent compensation costs readily identifiable from the home
page, accessible without complex website search and layered navigations?
2. Content & Clarity for Executive Compensation Page — Are the components of both
actual salary and all benefit costs presented? Are the components shown in detail, with a
total compensation cost included in table form? Is the compensation information
presented in a clear concise format that can be easily read and understood by the average
viewer?
3. Content & Clarity for Employee Compensation Page — Are the components of both
actual salary and all benefit costs presented? Are the components shown in detail, with a
total compensation cost included in table form? Is the composition information presented
in a clear, concise format that may be easily read and understood by the average viewer?
A summary assessment follows below and in detail on later pages in Table 1.
1. Compensation Cost Transparency (CCT) Accessibility
To be rated evicelicni for CCT accessibility the primacy link for compensation transparency
needs to be easily found on the website's home page.
Cities - The number of Orange County city web sites rated ewellen( for compensation
transparency accessibility nearly doubled in number from thirteen cities in 2011 to twenty -five
cities in 2012. The percentage of total Orange County cities rated excellent went from 38% in
2011 to 74% in 2012. Excellent commendable progress was achieved.
County -The county government web site is now rated em -ellew for CCT accessibility. This was
a significant achievement for the more than 17,000 positions involved.
2011 -2012 Orange County Grand Jury Page 8
14
COMPENSATION COST TRANSPARENCY
Water & Sanitation Districts - Eleven of the fifteen Water and Sanitation Districts (73 %) are now
rated excellent for CCT accessibility. Excellent progress was achieved overall.
Non-enterprise Special Districts, Transportation Special District & Joint Power Authority (JPA)
— Five of these eight special districts and JPA (63 %) were rated excellent for compensation
accessibility.
2. Content & Clarity for the EXECUTIVE Compensation Cost Pace
To be rated eccellemt for CCT Content and Clarity on the Executive Compensation Page - Full
total salary and benefits compensation cost disclosure is needed in table format, including
Defined Benefit Plan Pension Costs.
To be rated.!,,,,, , d for CCT Content and Clarity on the Executive Compensation Page
—Full total salary and benefits compensation cost disclosure is needed in table format, but
Defined Benefit Plan Pension Costs are not displayed
ities — In 2011, no cities were rated excellent for Content and Clarity. In contrast, in 2012, 14
cities were rated excellent for Content and Clarity for their Executive Compensation Page
(41 %). This is a good start, since another three were rated < :.,i, bringing the combined total
rated excellent and good up to 17 out of 34, for a total of 50 %.
Co un — The County government web site Executive Compensation Page, which was
nonexistent in 2010, is rated excellent for Content & Clarity in 2012.
Water & Sanitation Districts — Only one of the 15 water & sanitation districts (7 %) was rated
excellent for Content & Clarity on their Executive Compensation Page in 2012.15 They were
not rated at all last year. In 2011, they were just provided with broad recommendations and
without a suggested chart format. Expectations are to see great improvement in this area over
the next year. CCT is needed in these powerful and often overlooked districts.
Non - Enterprise Special Districts Transportation Special District & Joint Power Authority (JPA)
— Only the two library special districts out of these eight special districts and JPA (25 %) were
rated excellent this year for Content & Clarity for their Executive Compensation Page. These
special districts and JPAs were not studied for compensation transparency in 2011. Therefore,
great improvement is expected next year.
3. Content & Clarity for the EMPLOYEE Compensation Cost Pates
The rating scale descriptions.for CCT Content and Clarity for the EMPLOYEE Compensation
Cost pages were as follows:
" rw only ana rated exmllard wu Midway Chy Sanitary DtWiat.
2011 -2012 Orange County Grand jury Page 9
15
COMPENSATION COST TRANSPARENCY
- L%i slims - Full total salary & benefits compensation cost disclosure is needed in a single
table format, including Defined Benefit Plan Pension Costs.
-Full lotal sakuy & benefits compensation cost disclosure is needed in a single table
,format, but Damned Benefit Plan Pension Costs were excluded
-Full total salary disclosure is shown, but with just:
1) general text Memorandum of lhulerstanding (MOU) benefits, and/or
2) benefits scattered in multiple places; or
3) just benefit totals, and no details other than general text.
11 - Purr - Salary is shown in Minimum and Maximum Ranges by Position or
by Classification & Step levels, and with just:
1) general TextualMOUBenefits; midlor
2) benefits scattered in multiple places; or
3) benefits not shown in absolute dollars for a position.
P - Aone istent - Salary & benefit information could not be readily found
ities - Last year in 2011, no cities were rated excellent for Employee Content and Clarity, as
the focus for improvement was on the Executive Compensation Page. In contrast in 2012, only
five cities (15 %) took the initiative to obtain an excellent rating for Content and Clarity for their
Employee Compensation Page. While only one city's Employee Compensation Cost page is
❑oucxistent, twenty -one of the thirty -four cities (62 %) were rated pour for their Employee
Compensation Cost page.
Count - While the County has an excellent Executive Compensation Page, the County's
Employee Compensation Page was rated at erai:r in 2012 for its more than 17,000 positions.
Water & Sanitation Districts - Only one of the fifteen water & sanitation districts (7 %) was rated
excellent for Content & Clarity on their Employee Compensation Page in 2012.16 They were
not rated in 2011, but were provided with broad recommendations for their board's and general
manager's CCT. However, taxpayers are starting to expect Orange County local governments to
provide compensation information for all employees. Great improvement is expected in this area
over the next year.
Non - enterprise Special Districts, Transportation Special Districts & Joint Power Authority (JPA)
- Only three special districts out of these eight Special Districts and JPA (38 %) were rated
c u elle a this year for Content & Clarity for their Employee Compensation page. These special
1e The only me rated excellent was Midway City sanitary District
2011 -2012 Orange County Grand jury Page 10
16
COMPENSATION COST TRANSPARENCY
districts and JPAs were not studied for Compensation Transparency last year and significant
improvement is expected.
2012 Compensation Cost Transparency Assessment Ratings Chart
The 2012 Compensation Transparency Cost Assessment Ratings Chan for the County, and each
individual Orange County city, water and sanitation district, non- enterprise special district and
Joint Power Authority follows on the next pages as Table 1.
Each entity's web page has been graded on 3 Compensation Cost Transparency aspects, as
defined earlier and shown below in column headings #2, 3 and 4. Table 1 columnar headings,
most of which are self - explanatory or have been defined earlier, are as follows.
1. City /District/Joint Power Authority (which also includes the County of Orange)
2. Accessibility Grade (for web site Access to CCT h formation)
3. Executive Page Grade (for content & clarity of CCT it formation)
4. Employee Pages Grade (for content & clarity of CCT information)
5. Areas of Strength
6. Areas for Improvement
7. Web Update since March — An opporfunity for governmental entities who previewed this
report in May, 2012 to present a summary of any CCT web site updates to the Grand
Jury, made since the February/March of 2012 grades. Otherwise, the status of any
updates can be described in the normal official response letters, after this report is
issued
This year for 2012, the grading scale criteria were more objectively and precisely defined for
clarity. These criteria are detailed on the first page of Table 1 that follows.
2011 -2012 Orange County Grand Jury Page 11
17
COMPENSATION COST TRANSPARENCY
TABLE 1 — 2012 Compensation Cost Transparency Assessment Ratings Chart
Web Site Ratings Scale for Compensation Cost Transparency Grades
1. Accessibility Grades
A = EXCELLENT - Primary link for Compensation Transparency on Home Page
B = GOOD - .Secondan• link an Human Resources/Finance Page
_ : \ \' 1: R ; \GE -Only Data access is link !o the ojf -site ,hate Controller's Page
D = POOR - Data buried in Budget or other Data
F = NONEXISTENT - No Compensation Data just Tent and No link on Web ,Site
11. Content & Clarity Grades
A = EXCELLENT - Full Disclosure, including Defined Benefit Plan Pension Costs
B = GOOD - Full Disc•hnure, but without Defined Benefir Plan Pension Costs
Ir+ for Full Disclosure, but nrrh Ihftned lienifu Pension (IMP) C'u.q+ on separate pay;r,
er jus7 the annual D11Pfunding percentage resealed neth no amounts
C = AVERAGE - Ful/ Nalary Disclosure, with just General Textual ,b1UCr'* BeneItts
and/or Benefits .scattered in multiple places,
or Benefit Totals, but no details wher than General Teat
D = POOR - .Salary Min/Afar Ranges by Position or Classification & Srep levels,
with just General Textual MOU" Benefits,
and/or with Benefits scattered in multiple places,
or with Benefits not shown in absolute dollars for a position
F = NONEXISTENT - No Salary or Benefit Data
MOU - Memorandum of Understanding
2011 -2012 Orange County Grand Jury Page 12
18
COMPENSATION COST TRANSPARENCY
TABLE 1— 2012 Compensation Cost Transparency Assessment Ratings Chart
2011 -2012 Orange County Grand Jury Page 13
19
City/ District /
Access-
Fxec.
Employee
Areas of Strenra
Areas for
Web Updates
ihilkv
Pages
Joint Power
Paee
Improvement
since March or.
Au t orit
Grade
Grade
Grade
Mav Exit Interviews
County
1
County of
A
A
C
Excellent Executive
Employee Pages
UPDATE Note ] -
Orange
Page & Excellent
see end of table noic
Accessibility
Cities
1
Aliso Viejo
A
C
D
Excellent
Employee Pages for
n/a - Did not attend
Accessibility
Salaries and Benefits
A/av exit interview
2
Anaheim
A
B
B
Excellent
Employee Pages for
Accessibility
Salaries and Benefits
3
Brea
A
C
C
Excellent
Accessibility
4
Buena Park
A
A
A
Excellent in all ways
5
Costa Mesa
A
A
A
Excellent in all ways
6
Cypress
B
D
D
Both Executive and
Employee Pages for
Salaries and Benefits
7
Dana Point
A
A
D
Excellent Executive
Employee Pages for
Page
Salaries and Benefns
8
Fountain
B
F
D
Both Executive and
n/a -Did not amend
Valley
Employee Pages for
A4av exit interview
Salaries and Benefits
9
Fullerton
B
A
D
Employee Pages for
Salaries and Benefits
10
Garden
A
C
D
Excellent
Employee Pages for
Grove
Accessibility
Salaries and Benefits
11
Huntington
B
F
B
Executive Page for
Beach
Salaries and Benefits
12
Irvine
A
A
D
Excellent
Employee Pages for
UPDATE Note 2 -
Accessibility
Salaries and Benefits
See end of table (rotes
Excellent Exec Page
13
La Habra
A
A
F
Excellent
Employee Pages
Accessibility
needs Compensation
Excellent Exec. Page
Costs & Benefits
14
La Palma
A
D
D
Excellent
Both Executive and
UPDATE Note 3 -
Accessibility
Employee Pages for
See end of table notes
Salaries and Benefits
15
Laguna
A
D
D
Excellent
Both Executive and
UPDATE Note 4 -
Beach
Accessibility
Employee Pages for
See end of table note:
Salaries and Benefits
16
Laguna
A
D
Excellent
Employee Pages for
Hills
Accessibility
Salaries and Benefits
Exec Page needs
Pension Costs
17
Laguna
h
D
D
Both Executive and
n/a -Did not attend
Niguel
Employee Pages for
A4av exit interview
2011 -2012 Orange County Grand Jury Page 13
19
COMPENSATION COST TRANSPARENCY
2011 -2012 Orange County Grand Jury Page 14
NE
Salaries and Benefits
City /District/
ccess-
Exec,
Employee
Areas of Strenxths
Areas for
Web Updates
imI
Pager
Joint Power
Page
I mprovement
since March Per
AtrthoriN
Gra d e
G d
Grade
G
Grade
d
May Exit Interviews
18
Laguna
A
A
A
Excellent In all ways
Wa - Did not attend
Woods
Alav exit interview
19
Lake Forest
A
D
Excellent
Employee Pages for
Accessibility
Salaries and Benefits
20
Los
i.
D
Employee Pages for
nia -Did not attend
Alamitos
Salaries and Benefits
Mav exit interview
21
Mission
A
D
D
Excellent
Both Executive and
Viejo
Accessibility
Employee Pages for
Salaries and Benefits
22
Newport
A
C
Excellent
Beach
Accessibility
23
Orange
A
C
D
Excellent
Employee Pages for
rca - Did not amend
Accessibility
Salaries and Benefits
A* exit interview
24
Placentia
A
A
A
Excellent in all ways
25
Rancho
A
A
D
Excellent
Employee Pages for
Santa
Accessibility
Salaries and Benefits
Excellent Executive
Margarita
Page
26
San
A
A
D
Excellent
Employee Pages for
Clemente
Accessibility
Salaries and Benefits
Excellent Executive
Page
27
San Juan
A
A
D
Excellent
Employee Pages for
UPDATE Note S-
Capistrano
Accessibility
Salaries and Benefits
See end of table notes
Excellent Executive
Page
28
Santa Ana
B
B
D
Employee Pages for
UPDATE Note 6 -
Salaries and Benefits
See end oftable notes
29
Seal Beach
B
A
D
Excellent Executive
Employee Pages for
Page
Salaries and Benefits
30
Stanton
A
A
D
Excellent
Employee Pages for
n,n - Did not attend
Accessibility
Salaries and Benefits
Alav exit interview
Excellent Executive
Page
31
Tustin
A
D
Excellent
Employee Pages for
Accessibility
Salaries and Benefits
32
Villa Park
A
;
C
Excellent
n/a - Did not attend
Accessibility
Mav exn interview
33
Westminster
F
D
Both Executive and
n1a - Did rot attend
Employee Pages for
Alav ent astenwo,
Salaries and Benefits
34
Yorba Linda
A
A
A
Excellent in all ways
2011 -2012 Orange County Grand Jury Page 14
NE
COMPENSATION COST TRANSPARENCY
2011 -2012 Orange County Grand Jury Page 15
21
city /District/
Access.
Exec.
Employee
Areas of Strengths
Areas for
Web Updates
ibilil`'
Pages
Joint Power
Paee
Improvement
since March per
Author
Grade
§rIdt
Grade
May Exitlnterviews
5aeciol
Districts
Water and
s
1
Costa Mesa
A
B+
B+
Excellent
Exact pensions are
Sanitary
Accessibility
on separate list. Add
exact pensions to
chart and total
2
East OC
A
C
C
Excellent
Need chart w/ other
r ✓a -Did not attend
Water
Accessibility
pay, Insurance, exact
Alayexit interview,
pension cost & total
3
El Toro
A
C
F
Excellent
Employee Page Chart
UPDATE Note 7 -
Water
Accessibility
needed for Salaries &
sea end of table notes
Benefits
4
Irvine Ranch
A
D
D
Excellent
Both Executive and
Water
Accessibility
Employee Pages for
Salaries and Benefits
5
Mesa
A
D
D
Excellent
Both Executive and
UPDATE Note g -
Consolidated
Accessibility
Employee Pages for
Sce end of table notes
Water
Salaries and Benefits
6
Midway
A
A
A
Excellent in all ways
City
Sanitary
7
Moulton
A
D
D
Excellent
Both Executive and
Niguel
Accessibility
Employee Pages for
Salaries and Benefits
Water
8
Municipal
D
D
D
Have listing on home
Both Executive and
Water Dist.
page, but does not
Employee Pages for
of OC
list Information In an
Salaries and Benefits
accessible format.
9
Orange
A
D
D
Excellent
Both Executive and
UPDATE Note 9 -
County
Accessibility
Employee Pages for
Sec end of table notes
Salaries and Benefits
Sanitation
10
Orange
A
D
D
Excellent
Both Executive and
UPDATE Note 10
County
Accessibility
Employee Pages for
See end of table trots,
Salaries and Benefits
Water
11
Santa
C
F
F
Both Executive and
rva- Didnotattend
Margarita
Employee Pages for
May exit interview,
Salaries and Benefits
Water
12
Serrano
A
B
B
Excellent
Water
Accessibility
13
South Coast
A
D
D
Excellent
Both Executive and
Water
Accessibility
Employee Pages for
Salaries and Benefits
14
Trabuco
C
D
D
Both Executive and
Wa -Did not attend
Canyon
Employee Pages for
Alay exit interview
Water
Salaries and Benefits
15
Yorba Unda
B
D
D
Both Executive and
Water
Employee Pages for
Salaries and Benefits
2011 -2012 Orange County Grand Jury Page 15
21
COMPENSATION COST TRANSPARENCY
Legend: • N/A = Not Applicable
2011 -2012 Orange County Grand jury Page 16
22
City /District/
Access-
Enrti
Emolovee
Areas of Streneths
Areas for
Web Updates
MIA
Eaxes
Joint Power
Em
Improvement
since March oer
Authority
Grade
Grade
Grade
Mav Exit Interviews
Special
Districts
- Non
Enterprise
1
Buena Park
A
A
A
Excellent in all ways
Library
2
Orange
A
D
D
Excellent
Both Executive and
UPDATE Note 11
County
Accessibility
Employee Pages for
See end ofuble notes
Salaries and Benefits
Cemetery
3
Orange Co.
F
F
F
Accessibility, plus
wa - Did not attend
Vector
Both Executive and
May exit interview,
Control
Employee Pages for
Salaries and Benefits
4
Placentia
A
A
A
Excellent in all ways
Library
5
Rossmoor
D
F
F
Accessibility, plus
a/a -Did nor attend
Community
Both Executive and
May exit interview
Service
Employee Pages for
Salaries and Benefits
6
Silverado-
A
N /A*
A
Excellent in all ways
n/a -Did not attend
Modjeska
May exit interview
Recreation
& Parks
Sped°1
istrkt -
Transport
1
OCTA -
A
h
B
Excellent
Need to report
Orange
Accessibility
Retirement Plan
contribution
County
amounts as a stand -
Transpor-
alone Rem for full
tation
transparency, not
Authority
bundled
Joint Power
490-0—rlu
1
OCFA -
P
D
D
Both Executive and
Orange
Employee Pages for
Salaries and Benefits
County Fire
Authority
Legend: • N/A = Not Applicable
2011 -2012 Orange County Grand jury Page 16
22
COMPENSATION COST TRANSPARENCY
Table 1 WEB UPDATE NOTES from May, 2012 Exit Interviews on web changes since March, 2012:
1- The County of Orange subsequently submitted a spreadsheet of salary and benefit information for
over 17,000 employees for 2011 that they prepared for a Public Records Act response to a request
submitted by the Bay Area News Group, an organization of Northern California newspapers. The OC
Register requested to receive the same information once it was released to the original requestor. It
appears quite complete and the County of Orange will post this compensation information on the
County's web site as their Employee Compensation Cost pages for the public to see as well. It appears
be quite complete.
2- The City of Irvine reported that their Employee page was subsequently posted on their City
Compensation Page, using the Orange County Grand Jury suggested format. It appears to be quite
complete.
3. The City of La Palma reported that their website was updated in early May to reflect the Grand Jury's
requests. They submitted a copy of the City of La Palma 2011 Compensation Report and it appears to be
quite complete.
4. The City of Laguna Beach reported that they have added a table to the compensation pages to
include Defined Benefit Plan Pension Costs and a Total Salary and Benefits column for all employees. It
appears to be quite complete.
S. The City of San Juan Capistrano reported that they have added employee compensation pages to
their website. It appears quite complete.
6. The City of Santa Ana reported that data has been compiled for their Employee pages and will be
posted on their website in May, 2012.
7. The El Toro Water District reported that it has updated its website to include all compensation,
including pension for the GM, in table form. They report that they do not offer a defined benefit
plan, so there are no pension costs to disclose.
8. The Mesa Consolidated Water District reported that Executive Compensation is on the website, as
are Employee Salary Ranges and Title. May, 2012 report recommendations are being implemented.
9. The Orange County Sanitation District reported that their Compensation Cost website had been
updated.
10. The Orange County Water District reports that additional information has been added to their
website. The information that was on the website in March under "Human Resources" and is now
under "Transparency."
11. The Orange County Cemetery District reported an upgrade to their Salary and Benefit Summary that
they brought in for review. It appears quite complete.
2011 -2012 Orange County Grand Jury Page 17
23
COMPENSATION COST TRANSPARENCY
Recognition of Excellence in Compensation Cost Transparency (CCT) —
To recognize achievement of excellence in Compensation Cost Transparency, Appendix A
contains the 2012 ::oid. Silver and Bronze Honor Rolls. Listed are Orange County cities,
special districts/JPAs and the County of Orange. Appendix A also has the 2012 list of Most
Potential for Improvement. These four lists are described below.
mold Ilonof )toil is for cities & special districts providing outstanding overall CCT access,
content & clarity in government for their citizens. Straight "A" (excellent) ratings in all
three CCT categories of Accessibility, Executive Content & Clarity and Employee
Content & Clarity for 2012 were achieved by all listed.
2. Silver Ilonor Roll is for cities & special districts providing excellent executive CCT in
government for their citizens. "A' (excellent) ratings in the two categories of Accessibility
& Executive Content & Clarity for 2012 were achieved by all listed.
3. Bronze Ilonor Roll is for cities & special districts providing excellent CCT accessibility in
government for their citizens. "A" (excellent) rating in the one category of Accessibility for
2012 were achieved by all listed.
4. Most Potential for Improvement List for the cities & special districts in CCT. This
potential for improvement was demonstrated by receiving one 2012 "F" (nonexistent) rating
in at least one of the three CCT categories of Accessibility, Executive Content & Clarity
or Employee Content & Clarity.
Non - Transparent Compensation Costs Funding Guaranteed Pensions
Current fiscal pressures accentuate the need for more pension cost information. Public demand
is building for transparent reporting of unfunded pension liabilities in more detail.
The Government Accounting Standards Board (GASB) is addressing the unfunded pension
liability issue at the macro level. 17 GASB would mandate the movement of the unfunded
pension liability from an informational footnote to a liability on the balance sheet as early as
2013. Private industry Financial Accounting Standards Board (FASB) has mandated this
practice for years and upgraded their balance sheet pension liability reporting with FASB
Statement 158 in 2006.18
A real lack of transparency of reporting the annual government dollar costs to fund guaranteed
pensions appears at the emplovee.position pension level. Why?
17 GASB Postemployment Benefit Accounting and Financial Reporting Project, scheduled for statement release June, 2012. www, ansh.orc
1a "FASB adopts New Pension Std.," 1013/2006, hue: accounline.smanmos.com O W7 =I & htlo:C %Z w.fash,orzsumn a ,stsuml %shtml
2011 -2012 Orange County Grand Jury Page 18
24
COMPENSATION COST TRANSPARENCY
Last year, the 2010 -2011 Grand Jury asked for pension costs (i.e., the amounts that the city pays
for contributions to a pension plan, such as PERS and Social Security) to be reported in their
annual compensation cost disclosures. The county and some cities did, and many did not. The
ones who did were:
• The County of Orange reported pension costs on their Executive page.
• The city governments that provided excellent executive pension cost transparency by
apparently reporting pension costs on their Executive pages were:
• Dana Point
• Fullerton
• Irvine
• La Habra
• Rancho Santa Margarita
• San Clemente
• San Juan Capistrano
• Stanton.
The cities who apparently went a step further and reported pension costs for all their
employees and executives, to provide excellent maximum transparency for their
citizens were:
o Buena Park
o Costa Mesa
o Laguna Woods
o Placentia
o Yorba Linda.
The current focus of the California State Controller website does not yet reflect pension
compensation costs. So pension costs for defined benefit plans (DBPs) currently go unreported
on the state's local government's compensation site. The formula for the DBPs pension benefits
is shown instead.
The state site reports the shorthand formula for the DBP pension benefit. However the formula
is cryptic and the formula is not translated to the government's cost of funding it. A citizen can
view the benefit formula shorthand notation that shows at what age the employee can collect
what percentage of their last year's pay for every year of service.
The pension benefit formula is often not understood by the average citizen unless they are
already familiar with the formula shorthand notation. An explanation is offered here with an
example below.
2011 -2012 Orange County Grand Jury Page 19
25
COMPENSATION COST TRANSPARENCY
The pension formula for Officer Jane Doe, a public safety employee, is shown as "3 % @50"
The -3%@50" means that Officer Jane Doe can retire when 50 years old and collect 3% of her
last year's pay, which is multiplied by each year of her public service. More specifically, that
would mean when she obtained 50 years of age and if she had 30 years of public service, that
Officer Jane Doe could collect 90% of her last year's pay for the rest of her life (30 yrs x 3 %).
If her annual pay from her last year(s) or highest year was $100,000, then her pension annual
payment would be $90,000 for the rest of her life, plus cost of living allowances, if applicable.
The annual cost by the government of building up the funds for this pension is not shown on the
California State Controller's web site for this employee's position level The state site does not
currently focus on the government's compensation costs of the guaranteed pension, but just on
the benefit formula of the employee's guaranteed pension. This may change in the future, as
described in the "Future Potential for California's Local Government Pension Cost Reporting"
section.
Sienificance of Local Government's Cost of Funding Guaranteed Pension Benefits
Taxpayer and ratepayer dollars fund public pensions In many local governments, but not all,
taxpayers are obligated to pay government workers' guaranteed pension benefits as promised
through collective bargaining agreements. What is the range of the compensation costs of
defined benefit plans?
The range of pension fund investment annual payments that Orange County local governments
make for their General employees (officially classified as "miscellaneous" in pension plans) is
from 9% to 28% of salaries.
For Public Safety employees, that include fire, police, probation and lifeguards, the range is from
20% to 48% of salaries. Appendices B and C list these percentage amounts owed to CalPERS
or OCERS annually by each local government entity.
Are these government current compensation costs for a future benefit significant? Should
pension funding amounts by employee positions be reported to the public, even though they are
not current taxable compensation to the employee? Since local governmental annual investment
payments range from 9% to 48% of salary, they are significant for taxpayer citizens to know.
Taxpayer and ratepayer dollars fund these dollar amounts now to cover future pension
obligations for employees, and are real and significant costs of government employment.
Future Potential for California's Local Government Pension Cost Reporting
The government's portion of guaranteed pension annual costs currently go unreported on the
California State Controller's local government compensation reporting site That has been due to
different objectives. We understand this may change in the near future.
2011 -2012 Orange County Grand jury Page 20
99
COMPENSATION COST TRANSPARENCY
To reduce the workload and simplify different reporting requirements for Orange County local
governments, the 2011 -2012 Grand Jury has had a continuing dialogue with the State
Controller's office about the inclusion of pension costs.
Specifically, the discussions were with the California State Controller's Bureau of Local
Government Policy and Reporting. This unit of the State Controller's office is embarking on the
requirements phase for new database software to replace the annual influx of approximately
5,000 Excel spreadsheets.
The State Controller's office has considered the potential inclusion of requesting local
governments to report Pension Costs for Defined Benefit Plans (DBPs) in their future minimum
requirements. Informally, they have relayed to the 2011 -2012 Grand Jury that they plan to
include pension costs of DBPs in their reporting requirements for local government reporting in
2013, as part of the "burden cost of compensation." The new software implementation is
initially planned to include pension cost data in the second phase. They stated that they would
formally document their intentions to the Grand Jury in the near term.
Orange County citizens would benefit from being able to access DBP pension annual funding
costs by employee/position on local web sites as soon as possible in the spirit of full
transparency. Why wait? This information would appear to be too significant to ignore. Why
just provide only the bare minimum in compensation cost transparency reporting, as required by
the State Controller, when full transparency would benefit Orange County citizens now?
Need for Local Government Website Reporting of Compensation Cost Reporting
Compensation cost reporting is preferably shown on the local government website for ease of
citizen use and because the data will be the latest available. At the State Controller's level, the
local government reporting information can be from one to two years late due to the multiple
fiscal years that the State has to address for the approximately 5,000 local governments.
Taxpaying citizens deserve to see the costs of funding guaranteed pensions clearly displayed at
the employee position level now. The exceptional and commendable Orange County cities and
districts that appear to include pension cost amounts in their Executive and Em I2ovee
compensation costs in 2012 are:
o Buena Park
o Costa Mesa
o Laguna Woods
o Placentia
o Yorba Linda
o Midway Sanitary District
2011 -2012 Orange County Grand Jury Page 21
27
COMPENSATION COST TRANSPARENCY
• Buena Park Library District
• Placentia Library District.
Costa Mesa was recognized by the national Sunshine Review, a nonprofit organization dedicated
to government transparency. They were awarded a national 2012 Sunny Award for doing an
exemplary job at proactively disclosing information to taxpayers. 19 They were the only
government in California to receive an "A +" grade from the Sunshine Review. They set a good
transparency example. Costa Mesa solicits their citizens to send in additional ideas about how
they can improve their transparency at www ci costa -mesa ca/transparency /.
The exceptional and commendable Orange County governments that appear to include these
pension costs on their Executive Compensation cost page in 2012 are the County of Orange 2"
and the cities of
• Dana Point
• Fullerton
o Irvine
• La Habra
• Rancho Santa Margarita
• San Clemente
• San Juan Capistrano
• Stanton
" For sward infomation. see bent, wnshi0o<vww.a4ndea oho:012. %: \wad..
s0 The salaries and benefits for the County or0rangc 12 top elected officials ere shown on Sunshine Review's national wabsite at
hno' . WNhlnaeslew.a4Indcz.DM (karlQC Count- cmolovec salariex with reference to the 3100 employees who make over 5150.000 in total
compenation of salaries and benefits ( including pension crops). The reporting is excerpted am the County's eloped and executive
compensation web page, as recurmnended by lap year's 2010.2011 OC (had Jury, providing a good leadership example for OC cities & special
districts to follow.
2011 -2012 Orange County Grand Jury Page 22
9
COMPENSATION COST TRANSPARENCY
Signs of the Public's Need to see Pension Costs at the Employee Position Level
Recent signs of the public's increasing need to have pension costs reported at the Employee
Pension level include the following examples.
• Orange County Register's March 20, 2012 article on "Public pensions evolving at local
level" which had to rely on survey data, not actual local governmental Pension Cost data,
stated the following:
"Specifically, the recent League of California Cities survey that showed that 48% of
California cities have reduced pension benefits, for new hires. "'f
The building block for this Pension Cost information would naturally be at the Employee
Position level, like transparent Salary and other Benefits are, but alas it is not yet generally
available nor yet reported at that level.
The survey covered only the California cities that contract with CaIPERS. As a result, only
321 of California's 482 cities responded. Reporting Pension Costs per employee position on
a regular basis is topical and needed for transparent local government.
• USA Today's March 12, 2012 article on "In Too marry places, public pensions remain
private" which stated the following:
"Even in states (California Florida, New Jersey and New York) where pension data are
public, they're often tough to find Jf a newspaper or a public interest group hasn't put the
information online, people must file written requests to obtain it All states could take a cue
from New Jersey where pension data are posted and easily searchable online. ,22
The USA Today article concluded:
"Taxpayers have a right to know how their money is being spent. But when it comes to
public pensions, it's going to take a big push for transparency before that happens
everywhere.
• The California -based Little Hoover Commission issued a comprehensive report in February,
2011 on "Public Pensions for Retirement Security" that recommended:
71 "NWic pauiow evolving of 1ocni Leval," Orange Cowdy Repuer, Much 20, 2012, local, OC Watchdog, p.1
"-In I" nvwj• plea, prb6e pemtow rtnviwpnwo." LISA Today, Much 12.2012. p.8A
n [bid.
2011 -2012 Orange County Grand jury Page 23
M]
COMPENSATION COST TRANSPARENCY
"To improve transparency and accountability, more information about pension costs must be
provided regularly to the public. "''
Specifically recommended was that "The Legislature must require pension fund
administrators to improve procedures for detecting and alerting the public about unusually
high salary increases of government officials that will push pension costs upward "'3
A more expedient local method of educating the Orange County public would be to include
Pension Costs at the Employee Position level on the Orange County local government websites
today in transparent compensation cost reporting.
This would let Orange County local governments potentially lead in pension cost transparency,
as the County of Orange has done. One third of Orange County cities have already stepped out
front and done so, and others are expected to do so as well. Financial pressures are starting to
force local governments to make hard choices. Good clear transparent information reporting is
needed to make informed choices. Informed citizens can then understand and support future
actions.
FINDING S /CONCLUSIONS
In accordance with California Penal Code Sections 933 and 933.05, the 2011 -2012 Grand Jury
requires responses from each city, special district, joint power authority, as well as the County of
Orange and OCERS, affected and named by the findings presented in this section. The
responses should address the specific situation of the governmental entity responding. The
responses are to be submitted to the Presiding Judge of the Superior Court, with a copy to the
Orange County Grand Jury.
A list of which governments are required to respond to which of the findings are summarized in
Tables 2 and 3. These tables can be found in a later section entitled REQUIREMENTS AND
INSTRUCTIONS.
Based upon the assessment of 58 websites of the County of Orange, 34 OC cities, 15 OC water
and sanitation districts, 6 OC non - enterprise special districts, 1 transportation special district and
1 OC Joint Power Authority, the 2011 -2012 Orange County Grand Jury has five principal
findings.
"PuW Pemlom for Rerhemom seeuriry.- I Jule Hoover Commission. Stns of Califomia. February, 2011, Exewfive Summary,
Ibc_u
@id
2011 -2012 Orange County Grand Jury Page 24
M
COMPENSATION COST TRANSPARENCY
Finding I (F1) - Accessibility Ratings for Cities, Special Districts and JPAs
Accessibility to Compensation Costs for Orange County cities web -sites experienced 92%
improvement this year, but there is still room for improvement at some cities. Accessibility to
Compensation Costs on Orange County websites for districts and joint power authority (JPA) has
room for improvement, even though 70% were rated cArc! Icnt
o it'
There was a 92% improvement in CCT Accessibility from the thirteen cities rated
excellent in 2011 compared to twenty -five cities were rated excellent in 2012-
Yet there is still room for improvement for the remaining nine of thirty-
four Orange County cities who received a rating of in 2012 to
achieve excellen(, in CCT Accessibility.
o Special Districts and Joint Power Authority UPA):
Sixteen of the twenty -three special districts/joint power authority (70 %) were rated
cm—llew in 2012 for CCT Accessibility. This was a very good showing in their first year
of being rated
However, seven of the twenty -three special districts /joint power authority
were rated ^i!. ;:� ,,i�t . pour and nonexistent for CCT Accessibility, all of
whom could improve to ex, eut:u.
Finding 2 (F2) — Content & Clarity Ratings for EXECUTIVE Compensation Cost
Content and Clarity for the OC cities elected officials and executives over $100,000 in base
salary is improving in this 2 "d year of ratings. On the other hand, there is understandably even
more potential improvement possible for the Special Districts and joint power authority, which
are in their l° year of ratings.
o County:
The County of Orange went from a nonexistent Executive Compensation Page in 2011
to one rated excellent in 2012 for Content and Clarity.
o iie:
This year in 2012, fourteen of thirty -four cities (41 %) were rated excellent for Executive
CCT Content and Clarity, while none were rated excellent in 2011.
However, twenty of the thirty -four cities were rated, ... I - I , pour and
nonexistent for Executive Compensation Cost Content and Clarity, all of
2011 -2012 Orange County Grand Jury Page 25
31
COMPENSATION COST TRANSPARENCY
whom could improve to excellent.
o Special Districts and Joint Power Authority UP&
Only three of twenty -three special districts/JPA (13 %) were rated,, � eel leu i for
Executive Compensation Cost Content and Clarity.
■ Nineteen of twenty -three special districts /JPA who received ratings of ,(.
. . poor and nonexistent for Executive Compensation Cost can improve
to achieve an excellent rating.26
Finding 3 (173) - Content & Clarity for EMPLOYEE Compensation Cost Ratings
There is the most opportunity for more transparent reporting in the Content and Clarity of
Employee Compensation Cost reporting on local government websites.
o County:
The County of Orange was rated excellent above for their Executive Compensation Page
Content and Clarity.
However, the County of Orange was only rated r::9 p for Employee
Compensation Cost Content and Clarity and could improve to achieve an
excellent rating.
o Cities:
Only five ofthirty -four cities (15 %) were rated excellent for Employee Compensation
Cost Content and Clarity.
■ Twenty -nine of the thirty -four cities were rated l000d, aver, ge. poor and
nonexistent for Employee Compensation Cost Content and Clarity, all of
whom could improve to excetie.:
o Special Districts and Joint Power Authority (JPA)
Only four of twenty -three special districts and joint power authority (17 %) were rated
cs� 0 1erit for Employee Compensation Cost Content and Clarity.
■ Nineteen of the twenty -three special districts /JPA were rated
J)001' and nonexistent for Employee Compensation Cost Content and Clarity,
all of whom could improve to excellent.
'a One of the 23 special districts /3PAs was rated "Not Applimble" due to their volunteer executive board and no paid executives. (3 +19 +1 -23).
2011 -2012 Orange County Grand Jury Page 26
32
COMPENSATION COST TRANSPARENCY
Finding 4 (F4) — Transparency of Emplover Pension Contribution Rates
Many Orange County local government web sites do not generally post their employer
pension annual contribution rates prominently to their web sites as part of their
compensation cost disclosure for public disclosure.
Specifically, these employer contribution percentages refer to the annual percentages of
employee salary that CaIPERS (California Public Employees Retirement System) or OCERS
(Orange County Employee Retirement System) requires of Orange County local governments to
fund their employee guaranteed pension plans.
OCERS has the employer pension contribution rates buried in detailed actuarial reports
and presentations on the OCERS website or requires member passwords to access these
annual governmental funding rates. Thus, there is limited transparency for the public of these
governmental pension contribution rates.
Findine 5 (F5) — Inclusion of Overtime and On -Call Pay in Emvlovee Compensation Costs
The Orange County "de facto' standard for CCT in the county, cities, districts and JPA now
contains all employees, including a page for executives and all elected officials. Two key
categories are missing from compensation cost reporting. They are overtime pay and on-
call pay. They have become important as the new "de facto' compensation cost reporting
standard which now includes all employees.
These two cost categories can be significant for public safety employees. However, it is
recognized that these cost categories generally do not apply to elected officials. On the other
hand, if overtime does not occur for various employee positions, it is important for citizens to be
aware of the aware of that in the annual reporting.
RECOMMENDATIONS
In accordance with California Penal Code Sections 933 and 933.05, the 2011 -2012 Grand Jury
requires responses from each city, special district, joint power authority, as well as County of
Orange and OCERS, affected and listed in Tables 2 and 3 that follows The responses are to be
submitted to the Presiding Judge of the Superior Court, with a copy to the Orange County Grand
Jury.
Based upon the assessment of 58 websites of the County of Orange, 34 OC cities, 15 OC Water
and Sanitation Districts, 6 OC Non - Enterprise Special Districts, 1 transportation special district
and I OC joint power authority, the 2011 -2012 Orange County Grand Jury has five principal
recommendations
2011 -2012 Orange County Grand Jury Page 27
33
COMPENSATION COST TRANSPARENCY
Recommendation 1 (RI) - Access for Compensation Costs Transuarenc
The Grand Jury recommends that each of the sixteen Orange County cities, districts and joint
power authority that were rated less than e \ccllcoi for Accessibility upgrade their access to
compensation costs. The access should be intuitive, readily identifiable on the web site home
page and provide easy navigation within one or very few "clicks."
Recommendation 2 (R2) - Content & Clarity of EXECUTIVE Compensation Costs -
The Grand Jury recommends that each of the forty -one of the fifty-seven Orange County
cities, districts and joint power authority that were rated less than ( XCc ew for their
Content and Clarity for their Executive and Elected Officials compensation costs page
upgrade their Executive Compensation Pape. See Appendix D for a suggested full disclosure
model which is the same as 2011 with expanded descriptions, but with particular emphasis on
pension costs.
Recommendation 3 (R3) - Content & Clarity of EMPLOYEE Compensation Costs -
The Grand Jury recommends that the County of Orange and all Orange County cities,
districts and joint power authority that were rated less than [ Accllcnr for Content and
Clarity for their Employee compensation costs pages upgrade their Employee pages. See
Appendix D for a suggested full disclosure model which is the same as 2011 with the addition of
overtime pay, on -call pay and expanded descriptions, with particular emphasis on pension costs.
Recommendation 4 (R4) - Transparency of Emnlover Pension Contribution Rates -
The Grand Jury recommends that all Orange County cities, districts and joint power
authority, as well as the County of Orange, post their employer pension annual contribution
rates prominently and transparently on their web sites. Current and recent rates would be
instructive and informative. It is recognized that some already do.
The Grand Jury recommends that OCERS display their member organizations annual
contribution rates in a transparent way to the general public without password access on
their web site. For a suggested model, see http. //caipers.ca.cov and enter "public agency
employer contribution search."
Recommendation 5 (R5) - Transparency of Overtime Pay and On -Call Pay in Employee
Compensation Cost Reporting —
The Grand Jury recommends that all Orange County cities, districts and joint power
authority, as well as the County of Orange, include overtime pay and on -call pav in
compensation cost reporting on their employees' compensation pages. See Appendix D for a
suggested full disclosure model for these new compensation cost reporting categories.
2011 -2012 Orange County Grand Jury Page 28
34
COMPENSATION COST TRANSPARENCY
REQUIREMENTS AND INSTRUCTIONS
The California Penal Code Section 933(c) requires any public agency which the Grand Jury has
reviewed, and about which it has issued a final report, to comment to the Presiding Judge of the
Superior Court on the findings and recommendations pertaining to matters under the control of
the agency Such comment shall be made no later than 90 da'vs after the Grand Jury publishes its
report (filed with the Clerk of the Court); except that in the case of a report containing findings
and recommendations pertaining to a department or agency headed by an elected County official
(e.g. District Attorney, Sheriff, etc.), such comment shall be made within 60 dais to the
Presiding Judge with an information copy sent to the Board of Supervisors.
Furthermore, California Penal Code Section 933.05(a), (b), (c), details, as follows, the manner in
which such comment(s) is to be made:
As to each grand jury finding, the responding person or entity shall indicate one of the
following
a. The respondent agrees with the finding.
b. The respondent disagrees wholly or partially with the finding, in which case the
response shall specify the portion of the finding that is disputed and shall include
an explanation of the reasons therefore.
2. As to each grand jury recommendation, the responding person or entity shall report one
of the following actions:
a. The recommendation has been implemented, with a summary regarding the
implemented action.
b. The recommendation has not yet been implemented, but will be implemented in
the future, with a time frame for implementation
c The recommendation requires further analysis, with an explanation and the scope
and parameters of an analysis or study, and a time frame for the matter to be
prepared for discussion by the officer or head of the agency or department being
investigated or reviewed, including the governing body of the public agency when
applicable. This time frame shall not exceed six months from the date of
publication of the grand jury report.
d The recommendation will not be implemented because it is not warranted or is not
reasonable, with an explanation therefore
3. However, if a finding or recommendation of the grand jury addresses budgetary or
personnel matters of a county agency or department headed by an elected officer, both
the agency or department head and the Board of Supervisors shall respond if requested by
2011 -2012 Orange County Grand Jury Page 29
35
COMPENSATION COST TRANSPARENCY
the grand jury, but the response of the Board of Supervisors shall address only those
budgetary or personnel matters over which it has some decision making authority. The
response of the elected agency or department head shall address all aspects of the
findings or recommendations affecting his or her agency or department.
Comments to the Presiding Judge of the Superior Court in compliance with Penal Code section
933.05 are requested from the County of Orange Executive Office, Human Resources and
required from each city council of the cities set forth in Table 2 and Board of Directors of each
legislative, special assessing and joint power agency in Table 3, with a copy to the Orange
County Grand Jury.
2011 -2012 Orange County Grand Jury Page 30
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COMPENSATION COST TRANSPARENCY
TABLE 2— County & Cities Responses Required for Findings (F) & Recommendations (R)
2011 -2012 Orange County Grand Jury Page 31
37
F1
F2
F3
F4
F5
R1
R2
R3
R4
R5
Cou
County of Orange
X
X
X
X
X
X
01511
Aliso Viejo
X
X
X
X
X
X X
X
Anaheim
I X
I X
X
X
X
X
X
X
Brea
x
X
X
X
X
X
X
X
Buena Park
X
X
X
x
Costa Mesa
X
X
X
X
Cypress
X
X
X
X
X
X
X
x
X
x
Dana Point
X
X
X
X
X
x
Fountain Valley
X
X
X
X
X
X
X
X
X
X
Fullerton
X
I
X
X
X
X
X
X
X
Garden Grove
X
X
X
X
X
X
X
X
Huntington Beach
X
X
X
X
X
X
X
X
X
X
Irvine
X
X
X
x
X
X
La Habra
X
X
X
X
X
X
La Palma
X
X
X
X
X
X
X
X
Laguna Beach
X
X
X
X
X
X
X
X
Laguna Hills
X
X
X
X
X
X
X
X
Laguna Niguel
X
I X
I X.
X
X
X
X
X
X
X
Laguna Woods
X
I X
X
X
Lake Forest
X
X
X
X
X
X
X
x
Los Alamitos
X
X
X
x
X
X
X
X
X
X
Mission Viejo
X
X
X
X
X
X
X
X
Newport Beach
X
X
X
X
X
X
X
X
Orange
X
X
X
X
X
X
X
X
Placentia
I
I
X
X
x
X
Rancho Santa Margarita
X
X
X
X
X
x
San Clemente
X
X
X
X
X
x
San Juan Capistrano
X
X
X
X
X
X
Santa Ana
X
X
X
X
X
X
X
X
X
X
Seal Beach
X
X
X
X
X
X
X
X
Stanton
x
x
x
x
x
x
Tustin
X
X
X
X
X
x
X
X
Villa Park
X
X
X
X
X
X
X
X
Westminster
X
X
X
X
X
X
X
X
X
X
Yorba Linda
X
X
X
X
2011 -2012 Orange County Grand Jury Page 31
37
COMPENSATION COST TRANSPARENCY
TABLE 3— Special DIstlicts/JPAs /OCERS Responses Required for Findings (F) & Recommendations (R)
2011 -2012 Orange County Grand Jury Page 32
m
F1
F2
F3
F4
F5
R1
R2
R3
R4
R5
Special Districts
- Water and Sanitation
Costa Mesa Sanitary
X
X
X
X
X
X
X
X
East Orange County Water
X
X
X
X
X
X
X
X
El Toro Water
X
X
X
X
X
X
X
X
Irvine Ranch Water
X
X
x
X
I X
X
X
X
Mesa Consolidated Water
X
X
X
X
X
X
X
X
Midway City Sanitary
x
X
X
X
Moulton Niguel Water
x
X
X
X
X
X
X
X
Municipal Water District of OC
X
X
X
X
X
X
X
X
X
X
Orange County Sanitation
x
X
X
X
X
x
x
X
Orange County Water
X
X
X
X
X
X
X
X
Santa Margarita Water
X I
x
X
I X
I X
X
X
X
X
X
Serrano Water
x
X
X
X
X
X
X
x
South Coast Water
X
X
X
X
X
X
X
X
Trabuco Canyon Water
X
X
X
X
X
X
X
X
x
X
Yorba Linda Water
X
X
X
X
X
X
X
X
X
X
Special Districts
- Non Enterprise
Buena Park Library
X
I X
X
X
Orange County Cemetery
X
X
x
X
X
X
X
X
Orange County Vector Control
X
X
x
x
X
X
X
X
X
X
Placentia Library
x
X
X
x
Rossmoor Community Service
X
X
X
x
X
X
X
X
X
X
Silverado - Modjeska
Recreation & Parks
I
X
X
Special District
- Transportation
OCTA - Orange County
Transportation Authority
x
X
X
X
X
X
X
X
Joint Power Authorities
_
OCFA - Orange County
Fire Authority
X
X
X
x
X
X
X
X
X
X
Legislative District
OCERS - Orange County
Employees Retirement System
x
X
2011 -2012 Orange County Grand Jury Page 32
m
COMPENSATION COST TRANSPARENCY
APPENDICES
2011 -2012 Orange County Grand fury Page 33
39
COMPENSATION COST TRANSPARENCY
APPENDIX A — Compensation Cost Transparency Honor Rolls - Page I of 3
The 20l2,.'--: r ,:,; _ Poi I for supplying the best CCT in government for their citizens applies
to the following cities and special districts. They all received straight "A" ratings in an 3
categories of Accessibility, Content & Clarity for Elected/ Executive and Employee
compensation.
l iiir;
-
Y
Buena Park
Y
Costa Mesa
➢
Laguna Woods
➢
Placentia
➢
Yorba Linda
�jwcial Districts -
➢ Buena Park Library District
➢ Midway Sanitary District
➢ Placentia Library District
The 2012 Silver honor Roll for supplying excellent CCT in government for their citizens
applies to the following county, cities and special districts at the Executive & Elected official
level. The county and cities below all received "A" ratings in 2 categories of Executive
Accessibility and Content & Clarity. The special district below received an "A" rating in the 2
categories of Employee Accessibility and Content & Clarity, as they have no Executive page
Count
➢ County of Orange
Cities
Y Dana Point
➢ Irvine
Y La Habra
Y Rancho Santa Margarita
➢ San Clemente
➢ San Juan Capistrano
➢ Stanton
;iaecial Districts -
➢ Silverado-Modjeska Recreation & Parks District
2011 -2012 Orange County Grand Jury Page 34
40
COMPENSATION COST TRANSPARENCY
APPENDIX A — Compensation Cost Transparency honor Rolls - Page 2 of 3
The 2012 Bronze Honor Roll for supplying excellent CCT accessibility in government for their
citizens applies to the following cities, special districts and joint power authorities. They all
received "A" ratings in Accessibility.
Cii -
➢
Aliso Viejo
r
Anaheim
Brea
i
Garden Grove
i
La Palma
'r
Laguna Beach
'o
Laguna Hills
Y
Lake Forest
Mission Viejo
r
Newport Beach
r
Orange
r
Tustin
Villa Park
Suecial Districts -
'r Costa Mesa Sanitary District
:> East Orange County Water District
i-
El Toro Water District
Irvine Ranch Water District
r Mesa Consolidated Water District
;w Moulton Niguel Water District
Orange County Cemetery District
r Orange County Sanitation District
r Orange County Transportation Authority
Orange County Water District
r Serrano Water District
South Coast Water District
2011 -2012 Orange County Grand Jury Page 35
41
COMPENSATION COST TRANSPARENCY
APPENDIX A — Compensation Cost Transparency Honor Rolls - Page 3 of 3
The 2012 Most Potential for Improvement List in local government compensation cost
transparency applies to the following cities and special districts. They received at least one "F"
in one or more of the three categories
Cities -
� Fountain Valley
Huntington Beach
La Habra
Westminster
El Toro Water District
Orange County Vector Control District
Rossmoor Community Service District
Santa Margarita Water District
2011 -2012 Orange County Grand Jury Page 36
42
COMPENSATION COST TRANSPARENCY
APPENDIX B: Cal PERS (Camiumin Puhlic F.mnluree Rruremrnt mocito EmD lover Contribution 2011 Rates-
% of Current Employee Payroll that the Employer must contribute to COMERS in 2011
Cities
General
Safety
Safety -Fire Safety- Police
Aliso Viejo
9.539%
Anaheim
20.389%
29.228% 30.623%
Brea
11.219%
30.347%
Buena Park
14.700%
25.821 %*
Costa Mesa
16.583%
32.404% 29.063%
Cypress
12.222%
32.407 %*
Dana Point
10.059%
Fountain Valley
17.800% - 1" Tier<
28.859% -
1" Tier<
Fullerton
11.119%
30.2%
Garden Grove
17.854%
33.178%
Huntington Beach
15.311%
34.196%
Irvine
21.733%
32.678%
La Habra
11.752%
31.962%
La Palma
14.762%
25.821 %*
Laguna Beach
15.258%
21.252 % -
Lifeguard 24.112%A 24.112%A
Laguna Hills
11.271%
Laguna Niguel
10.539%
Laguna Woods
10.896%
Lake Forest
12.170%
Los Alamitos
10.748%
25.21 %*
Mission Viejo
16.361%
Newport Beach
12.208%
35.028 %>
Orange
18.646%
29.613%
Placentia
9.548%
44.581 %*
Rancho Santa Margarita
16.497% - I" Tier<
San Clemente
#
32.546 % -
Lifeguard
Santa Ana
18.373%
28.848%
Seal Beach
9.313%
25.821%*
Stanton
13.523%
Tustin
9.943%
32.17 %*
Villa Park
20.046%
Westminster
14.494%
25.821°/x,*
Yorba Linda
13.996%
'• CaIPERS • Ilrtg_ w���r 4��y,�a ¢v� +InJes un'Ibc- emolvvcrn�huarSll•tuch cawrMrun raf shame xml
2011 -2012 Orange County Grand jury Page 37
43
COMPENSATION COST TRANSPARENCY
Appendix 8 Notes Le¢end:
* OCFA notes that these *rates of OCFA serviced cities apply only to non -fire safety employees
< Second Tier Levels in effect currently -
Second Tier level for Fountain Valley General Employees is 8.902% & 20.308% for Police
Second Tier level for Rancho Santa Margarita General Employees is 8.704%
> A Future Second Tier Level was approved in May, 2012 by Newport Beach for Firefighters that
will go into effect in 2014 that will have Newport Beach "paying 80% of pension costs
annually instead of the 94% annually they are currently contributing.... It will take 18
months for the new contribution percentages to take effect. "2B
^ Laguna Beach has subsequently implemented a second tier for public safety officers
# Administered by Great -West Retirement Services for San Clemente non - safety employees
"-Newport Beach firefighters to pay more of pensions ", Orange County Register, May 25, 2012, Local, Government, p.9.
2011 -2012 Orange County Grand Jury Page 38
44
COMPENSATION COST TRANSPARENCY
API, ENDI% C: OCERS ton ee cuunn EmN,.r•es RrW@ ment Scsiem) Employer Contribution 2012 -2013 Rates 29
% of('urrent Eniplo vee Pa}-roll that F.mphner must contribute to 0(-E16 in Fiscal Year 2013
Representative OCERS Examples and not a Comprehensive ItstinY
City General Safety
San Juan Capistrano (2.7%@SS) —Rate Group #2 28.39%
(2.0 % @57) — Rate Group #2 27.49%
County Special Districts
Orange County Cemetery District
(2_0 %�la 55) Rate Group #11 17.76%
Orange County Sanitation District— OCSD
(1.664%@5 .,) Rate Group #3 26.69%
(2.5%@55) Rate Group #3 27.47%
Orange County Transportation Authority— OCTA
Rate Group #5 20.96%
Joint Power Authority
Orange County Fire Authority — OCFA
(2.7 % @55) Rate Groups #10 27.99%
(2.0% @55) Rate Group #10 27.25%
(3.0%@5 ) Rate Group #8 45.46%
(3.0 %, @55) Rate Group #8 42.22%
Countv of Orange
General — Rate Group #1 16.85%
General (1..62 % @65) Rate Group #2 21.94%
General (2.7 % @55) Rate Group #2 28.39%
Law Enforcement (3.0% @50) Rate Group #7 47.45%
(3_O%!q @55) Rate Group #7 46.78%
Probation (3.0%@S ) Rate Group #6 36.29%
°U('l; 2C :0 /( /;trmm�nl I'aluannn and /[....... I, '11w S,pl Group. In,
2011 -2012 Orange County Grand jury Page 39
45
COMPENSATION COST TRANSPARENCY
APPENDIX D - Compensation Cost Disclosure Model - Page 1 of 2
POSITION SALARY OVER- OTHER INSURANCE PENSION TOTAL
TIME PAY* PREMIUMS COSTS COMP.
COSTS
* Other Pay Includes Fees, Deferred
Pay in Lieu of Time Off and On -Call Pay.
(RED mgmfic> iw%% in -1012)
2011 -2012 Orange County Grand Jury Page 40
46
COMPENSATION COST TRANSPARENCY
APPENDIX D - Compensation Cost Disclosure Model - Page 2 of 2
In the interest of consistency and clarity in the disclosure of compensation cost data for local
government officials and employees, the 2010 -2011 Orange County Grand Jury developed a
model table on the previous page, which could be posted onto the Internet websites of local
governments in Orange County. The 2011-2012 Orange County Grand Jury has enhanced and
expanded the applicability of the model for clarity, emphasis and scope, as local websites have
evolved. The fundamental elements of the model on the websites would provide the following.
• Accessibility - The link from the home page to the compensation cost web page be a
permanent feature, which is prominently displayed on the home page, as both self - descriptive
and intuitive, requiring very minimal keystrokes for access.
• Positions Reported - All elected officials and those executive positions earning a base salary
rate in excess of $100.000 per year should be reported on an Executive Compensation Pape
Elected officials should be listed first, followed by employees in descending order of salary
The salaries and benefits for all employee positions should be posted in a standard table on a
separate on the Employee Compensation Pages
Note The listing of names is not recommended on the compensation cost listings of employee
position salaries and benefits, but is preferable for elected officials.
• Salary Reporting -- The actual or annualized base rate of salary for the position should be
shown, rather than minimum & maximum ranges or the employee's W -2 form Box 5 amount
Overtime Pay - Actual overtime pay by employee position
• Other Pay
• Fees - Fees earned from reporting agency- sponsored boards, committees or commissions
• Deferred Compensation
• Bonus - Any form of management, incentive or performance improvement bonuses.
• Pay in Lieu of Time Off
• Automobile Allowance
o 0
• Insurance Premiums - Annualized amounts that the reporting agency pays on the employee's
behalf for medical, dental, vision, disabilitv and life insurance
• Pension Costs - Annual amounts that the reporting agency pays for contributions to a pension
plan (such as CaIPERS or OCERS) and/or Social Security. This is the government's share of
the Employer Pension Annual Contribution to CalPER.S, OCE2S & Social Security, in
addition to the Employer payment of an), share of the Employees obligated contribution
percentage. See Appendices B and C
• Total Compensation - Salary and benefit amounts should be totaled for the calendar year
RED denotes nc« reporting requirement in 20 12
2011 -2012 Orange County Grand Jury Page 41
47
COMPENSATION COST TRANSPARENCY
APPENDIX E: Methodology Details — Page 1 of 2
• Reviewed the three 2010 -2011 Orange County Grand Jury reports on:
• Compensation Study of Orange County Cities;
• County of Orange Compensation Disclosure;
o Compensation Survey of Orange County Water and Sanitation Districts.
• Reviewed 54 city, water & sanitation districts and county government response
letters30 to the findings and recommendations of the three previous 2010-
2011 Orange County Grand Jury reports.
• The 53 entities in the 2010 -2011 studies were the 34 Cities of Orange County,
one County government and 18 Water & Sanitation Special Districts.
• The 34 cities included Aliso Viejo, Anaheim, Brea, Buena Park, Costa Mesa,
Cypress, Dana Point, Fountain Valley, Fullerton, Garden Grove,
Huntington Beach, Irvine, La Habra, La Palma, Laguna Beach,
Laguna Hills, Laguna Niguel, Laguna Woods, Lake Forest, Los Alamitos,
Mission Viejo, Newport Beach, Orange, Placentia, Rancho Santa
Margarita, San Clemente, San Juan Capistrano, Santa Ana, Seal Beach,
Stanton, Tustin, Villa Park, Westminster and Yorba Linda.
• The 18 Water and Sanitation Special Districts were Costa Mesa Sanitation
District, East Orange County Water District, El Toro Water District, Irvine
Ranch Water District, Laguna Beach County Water District, Mesa
Consolidated Water District, Midway City Sanitary District, Moulton
Niguel Water District, Municipal Water District of OC, Orange County
Sanitation District, Orange County Water District, Rossmoor/Los
Alamitos Area Sewer District, Santa Margarita Water District, Serrano
Water District, South Coast Water District, Sunset Beach Sanitary District,
Trabuco Canyon Water District and Yorba Linda Water District.
• Discussed in conversations, both in person and by phone, with selected Orange
County cities and county governments about their 2010 -2011 responses.
at Expanded the 2012 study to include 7 additional special districts, 1 joint power
authorities (JPAs), and eliminated 3 water and sewer district to make a
total of 58 governmental web sites to be reviewed.
o The 8 additions are the:
■ Joint power authority of the Orange County Fire Authority;
■ 6 Special (non -water and sanitation) Districts of Buena Park
Library District, Orange County Cemetery District, Orange
County Vector Control, Placentia Library District,
" 54 letters were received from 53 entities (34 cities, IS water & sanitation districts and 1 county government) since the city of laguns Hills sent
a separate minority and majority response. All response letters to the 2010.2011 Orange County Grand Jury reports can be found at
p Feu o ypall j1un ora rCOJnt asp .
2011 -2012 Orange County Grand Jury Page 42
48
COMPENSATION COST TRANSPARENCY
APPENDIX E: Methodology Details — Page 2 of 2
Rossmoor Community Services District and
Silverado/Modjeska Recreation & Parks District.
■ I Special (transportation) District, which is the Orange County
Transportation Authority.
o The 3 eliminations are Rossmoor/Los Alamitos Sewer District (no longer
has a web site), Sunset Beach Sanitary District (which doesn't
have a web site) and Laguna Beach County Water District, (now a
part of the City of Laguna Beach).
Corresponded with the OC local governments to be studied —
o Re the establishment of this study to examine the local government web
sites for the level of CCT, in terms of accessibility and content &
clarity — by letters
• Dated January 9 & 10, 2012 to 34 cities & 23 special
districts/joint power authorities
• Dated January 24, 2012 to Orange County CEO
o Re: the frequently asked questions (FAQ's) concerning the Compensation
Cost Transparency study — by letters
• Dated February 23, 2012 to 34 cities & 23 special districts/JPAs
• Dated March S, 2012 to Orange County CEO
• Expanded the web assessment rating criteria to be more precise and objectively
defined to build upon the previously more subjective rating criteria.
• Researched on the CalPERS web to obtain the OC cities' and special districts'
individual public employer contribution annual percentage rate of
employee salary that CaIPERS requires the OC cities & special districts to
contribute for their employee members' pensions.
• Solicited OCERS and obtained the OC individual public employer contribution
annual percentage rate of employer salary that OCERS requires the county
agencies, county JPAs and some city & special districts to contribute for
their employee members' pensions.
• Reviewed, documented and assessed the transparency & content & clarity of each
OC local government web site multiple times.
• Initiated explanatory phone conversations in March, 2012 with several special
districts/joint power authorities, selected cities and County CEO office.
• Initiated February & March, 2012 phone conversations with the California State
Controller Office's Bureau of Local Government Policy and
Reporting to understand the state's local government compensation
reporting requirements and future plans.
• Compiled data, charts & assessments from documentation & web reviews.
• Drafted and published study background, facts, analysis /findings &
recommendations.
2011 -2012 Orange County Grand Jury Page 43
49
California Penal Coale Sections 033 and 033.05
[Note: to reduce grand jury requests for additional response information, the grand jury has bolded those
words in §933.05 which should be appropriately included in a response]
§933 (a) Each grand jury shall submit to the presidingjudge of the superior court a final report of its
findings and recommendations that pertain to county government matters during the fiscal or
calendar year. Final reports on any appropriate subject may be submitted to the presidingjudge of
the superior court at any time during the term of service of a grand jury. A final report may be
submitted for comment to responsible officers, agencies, or departments, including the county
board of supervisors, when applicable, upon finding of the presidingjudge that the report is in
compliance with this title. For 45 days after the end ofthe term, the foreperson and his or her
designees shall, upon reasonable notice, be available to clarify the recommendations of the report.
(b) One copy of each final report, together with the responses thereto, found to be in compliance
with this title shall be placed on file with the clerk of the court and remain on file in the office of
the clerk. The clerk shall immediately forward a true copy of the report and the responses to the
State Archivist who shall retain that report and all responses in perpetuity.
(c) No later than 90 days after the grand jury submits a final report on the operations of any public
agency subject to its reviewing authority, the governing body of the public agency shall comment
to the presidingjudge of the superior court on the findings and recommendations pertaining to
matters under the control of the governing body, and every elected county officer or agency head
for which the grand jury has responsibility pursuant to Section 914.1 shall comment within 60
days to the presiding judge of the superior court, with an information copy sent to the board of
supervisors, on the findings and recommendations pertaining to matters under the control of that
county officer or agency head and any agency or agencies which that officer or agency head
supervises or controls. In any city and county, the mayor shall also comment on the findings and
recommendations. All of these comments and reports shall forthwith be submitted to the presiding
judge of the superior court who impaneled the grand jury. A copy of all responses to grand jury
reports shall be placed on file with the clerk of the public agency and the office of the county
clerk, or the mayor when applicable, and shall remain on file in those offices. One copy shall be
placed on file with the applicable grand jury final report by, and in the control of the currently
impaneled grand jury, where it shall be maintained for a minimum of five years.
(d) As used in this section "agency" includes a department.
§933,05 (a) For purposes of subdivision (b) of Section 933, as to each grand jury finding, the responding
person or entity shall indicate one of the following:
(1) The respondent agrees with the finding.
(2) The respondent disagrees wholly or partially with the finding, in which case the
response shall specify the portion of the finding that is disputed and shall include an
explanation of the reasons therefor.
(b) For purposes of subdivision (b) of Section 933, as to each grand jury recommendation, the
responding person or entity shall report one of the following actions:
(1) The recommendation has been implemented, with it summary regarding the
implemented action.
(2) The recommendation has not yet been implemented, but will be implemented in the
future, with a timeframe for implementation.
(3) The recommendation requires further analysis, with an explanation and the scope and
parameters of an analysis or study, and a timeframe for the matter to be prepared for
discussion by the officer or head of the agency or department being investigated or
reviewed, including the governing body of the public agency when applicable. This
timeframe shall not exceed six months from the date of publication of the grand jury report.
(4) The recommendation will not be implementer) because it is not warranted or is not
reasonable, with an explanation therefor.
-M
(c) However, if a finding or recommendation of the grand jury addresses budgetary or personnel
matters of a county agency or department headed by an elected officer, both the agency or
department head and the board of supervisors shall respond if requested by the grand jury, but the
response of the board of supervisors shall address only those budgetary or personnel matters over
which it has some decision making authority. The response of the elected agency or department
head shall address all aspects of the findings or recommendations affecting his or her agency or
department.
(d) A grand jury may request a subject person or entity to come before the grand jury for the
purpose of reading and discussing the findings of the grand jury report that relates to that person or
entity in order to verify the accuracy of the findings prior to their release.
(e) During an investigation, the grand jury shall meet with the subject of that investigation
regarding the investigation, unless the court, either on its own determination or upon request of the
foreperson of the grand jury, determines that such it meeting would be deu•imentul.
(q A grand jury shall provide to the affected agency a copy of the portion of the grand jury report
relating to that person or entity two working days prior to its public release and after the approval
of the presiding judge. No officer, agency, department, or governing body of a public agency shall
disclose any contents of the report prior to the public release of the final report.
51
Mayor
Nancy Gardner
Mayor Pro Teat
Keith D. Cm ry
Council Members
Lcslic J. Daigle
Michael F. Henn
Rush N. Hill, II
Steven J. Rosansky
f dwnrd D. Selidl
CITY OF NEWPORT BEACH
OFFICE OF THE MAYOR
October 10, 2012
The Honorable Thomas J. Borris
Presiding Judge of the Superior Court
700 Civic Center Drive West
Santa Ana, California 92701
RE: Report of the Orange County Grand Jury — "Transparency Breaking Up
Compensation Fog — But Why Hide Pension Costs ?"
Dear Judge Borrls:
The attached is the City of Newport Beach's formal response to the above -noted
Grand Jury Report.
If you or any members of the Grand Jury have questions about our response, please
do not hesitate to contact City Manager Dave Kiff at dkiff @newaortbeachca.gov or
949- 644 -3001.
Sincerely,
NANCY GARDNER
Mayor of Newport Beach
City Hall ^ 3300 Newport Boulevard ^ Post Office Box 1768
Newport Beach, California 92658 -8915 ^ www.newportbeachca.gov
(949) 644 -3004
CITY OF NEWPORT BEACH
MEMORANDUM
FROM: City of Newport Beach, California
DATE: October 9, 2012
RE: Response to a Report of the Orange County Grand Jury titled
"Transparency Breaking Up Compensation Fog - But Why Hide Pension
Costs ?"
The Grand Jury's recent report, "Transparency Breaking Up Compensation Fog - But
Why Hide Pension Costs ?" obligates the City of Newport Beach (City) to respond nc
later than October 12, 2012 to:
Findings 2, 3, 4, and 5; and
Recommendations 2, 3, 4, and 5.
City Manager Dave Kiff was instructed to respond to the report on the City's behalf. His
comments follow.
FINDINGS
Finding 2 - Content and Clarity Ratings for EXECUTIVE Compensation Cost. Twenty of
the thirty -four cities were rated good, average, poor and nonexistent for Executive
Compensation Cost Content and Clarity, all of whom could improve to excellent.
Response: We agree that we can improve the provision of this information.
Finding 3 - Content and Clarity Ratings for EMPLOYEE Compensation Cost Ratings.
Twenty -nine of the thirty -four cities were rated good, average, poor and nonexistent for
Employee Compensation Cost Content and Clarity, all of whom could improve to
excellent.
Response: We agree that we can improve the provision of this information.
Finding 4 - Many Orange County local government web sites do not generally post
their employer pension annual contribution rates prominently to their web sites as part
of their compensation cost disclosure for public disclosure.
Response: We agree that this information is not easy to find on our website, and that
can be improved fairly easily.
City Hall o 3300 Newport Boulevard o Post Office Box 1768 o Newport Beach, California 92659 -1768
Response to a Report of the Orange County Grand Jury titled "Transparency Breaking Up Compensation
Fog - But Why Hide Pension Costs ?"
October 9
Page 2
Finding 5 -Two key categories are missing from compensation cost reporting. They are
overtime pay and on -call pay.
Response: We agree that this information is not easy to determine, but it also varies
significantly person to person and year to year. It might be easier to post a year in
arrears rather than in the current year.
RECOMMENDATIONS
Recommendation #2 - The City should upgrade its executive compensation page, with
a particular emphasis on pension costs.
Response: This recommendation has not been implemented, but will be implemented
in the future, within roughly six months.
Recommendation #3 -The City should upgrade its employee compensation cost
pages, with a particular emphasis on pension costs, overtime pay, on -call pay, and
expanded descriptions."
Response: This recommendation has not been implemented, but portions of it will be
implemented in approximately six months. It may be challenging to include overtime
pay and on -call pay by specific individual, given that these numbers change
frequently, and can vary year to year. The City will examine ways to provide this
information.
Recommendation #4 - The City should post its employer pension annual contribution
rates prominently and transparently on their websites.
Response: This recommendation has not been implemented, but will be implemented
in the future, within roughly six months.
Recommendation #5 - The City should include overtime pay and on -call pay in
compensation cost reporting on their employees' compensation pages.
Response: As noted in our response to Recommendation #3, the City will examine ways
to provide this information in a relevant and timely way. As of the date of this response,
this recommendation requires further analysis to examine whether current year or past
year information is regularly reportable, and whether the City's current software system
could effectively provide it. The analysis will be completed within six months.
If the Grand Jury has any questions or concerns about this response, please contact
City Manager Dave Kiff at 949- 644 -3001 or dkiff @newportbeachca.gov
NO ON MEASURE EE
October 9, 2012
The Honorable Thomas J. Burris
Presiding Judge of the Superior Court
700 Civic Center Drive West
Santa Ana, California 92701
4 )0 - m-0-12
Re: Report of the Orange County Grand Jury — "Transparency Breaking Up
Compensation Fog — But Why Hide Pension Costs ?"
Dear Judge Borris
I write to advise you about additional "compensation fog" that has arisen in the City of
Newport Beach.
I am a member of "No on Measure EE." As indicated in this letterhead, we are "No on
Measure EE" which is a grass roots group of long time and concerned Newport Beach residents who
oppose the City of Newport Beach's proposed 2012 Charter Amendments known as Measure EE.
We submitted Arguments in Opposition to the Measure and Rebuttal Argument to the Proponents
Argument in Support of the Measure.
In connection with our Rebuttal to the Argument in Support which was timely submitted on
August 16, 2012, we noted that one of the problems with Measure EE concerned compensation. In
this Rebuttal, we stated:
"The new Council compensation provisions fail to disclose the $19,045.34 per year
health and retirement benefits which each councilperson receives in addition to the
$14,728.20 per year reimbursement for expenses currently sanctioned (with cost of
living increases) by the Charter."
This was enclosed in the City Clerk's August 17, 2012 letter to us which is attached.
On August 17, 2012, we received a letter from the City Clerk for the City of Newport Beach
which stated that the above is false and misleading. She demanded that we rewrite it or defend it in
court. She stated:
You are correct that proposed City of Newport Beach Charter Section 402
(Compensation) does report the City Council's compensation amount which currently
totals $14,728.20 per year; however, the $19,045.34 is not considered compensation
as the Section title indicates. The health and retirement benefits Council Members
receive under the California Public Employees' Retirement System are authorized
under Charter Section 900 (Retirement System) and are listed as benefits and not as
No2MeasureEE.com
NO.ON.MEASURE.EE @GMAIL.COM
1048 IRVINE AVE., No. 273
NEWPORT BEACH. CALIFORNIA 92660
OFFICE OF THE CITY CLERK
Leilani 1. Brown, MMC
August 17, 2012
Via Regular U.S. Mail and Email
Mr. Robert Hawkins (rhawkins62
earthl ink. net)
14 Corporate Plaza, Suite 120
Newport Beach, CA 92660
Mr. Ron Hendrickson and Mrs.
Novell Hendrickson (ronov(a�cox.net)
1991 Port Claridge Place
Newport Beach, CA 92663
Ms. Lucille Kuehn
1831 Seadrift Drive
Corona del Mar, CA 92625
Mr. Jim Mosher (Jmmosher(a7yahoo.com)
2210 Private Road
Newport Beach, CA 92660
Re: Requested Revisions to the Rebuttal to Direct Argument In Favor of Measure EE
Dear Mr. Hawkins, Mr. and Mrs. Hendrickson, Ms. Kuehn, and Mr. Mosher:
As (lie City of Newport Beach's City Clerk, I serve as the City's Elections Official. This position comes with
considerable responsibility to follow and enforce election laws and standards. One of the laws that I must
seek strict compliance of is that all election materials printed and presented to the voters is true and
accurate. In reviewing the rebuttal argument that you submitted, I found two (2) clauses which violate the
standard and I would like to present you with the opportunity to review and edit the clauses.
The law provides that ballot arguments shall be made available for inspection and copying for a period of
ten (10) calendar days following the deadline for submission of those materials. (California Elections
Code Section 9295.) During those ten (10) calendar days, any voter or the Elections Official may seek a
writ of mandate or injunction requiring any of the materials to be amended or deleted. A writ of mandate
or an injunction may be issued upon clear and convincing proof that the material in question is false,
misleading, or inconsistent with the requirements of the Elections Code, and that issuance of the writ or
injunction will not substantially interfere with the printing or distribution of official election materials as
provided by law.
3300 Newport Boulevard Post Office Box 1768 Newport ]Beach, California 92658 -8915
Telephone: (949) 644 -3005 Feu: (949) 644 -3039 xvRv v.cit},.ne%;.—Port- beach.ca.us
Rebuttal to `Lrgument in Favor of Measure £E
Our Cite Charter is our Constitution: it should define the people's rights and limit the Chv 's poa ers.
Instead, the aunend.ments proposed in Measure EE weaken existing restraints Ind limit public
participation. We are asked, with a iftLr[C Y) S or NO vote, to approN c ?8 di\ crs and vaguely
e�piained proposal
Contrary t,) wl-,at tcc proponents s.iN :
C The last minute prohibition of red -light cameras, added without revi niv b) the Charter
Committee. would be better handled by ordinance It was a rushed proposal and ;,. red herring: it
is mi�sin�? c�•,cntial r,ords and naa} preclude f.;une tecl?aolor� cal ad\:mc.•: beneti_ia( to our City.
i The char -, io ih,: conflict of lldcltist provisions rioted ;,,i ( owlc;l. nui :he pubhc%
The new Council compensation provisions fail to di close the S 19;045.34 per year health and
retir, went benefits which each councilperson receives irs addition to the $14,728.20 per year
reimhursement for e :y�cnscs currently sanctioned t\�ith cost of li-. in- increases) i the Charter.
u the i' :r\ _Si0^ barring cl8cs ::J:,un9 reslricL Cai7cra' ri h•- 1% - ecovc,
b ch„rged !es an
mad ha\e quest onable legality.
o The supposedly antiquated "fu 11 audit" requiring ",cost!v small prim' is in fact a 25 -line financial
stawrncnt that -osts _,.1 14 to pi int.
iv1: asure LE h--is n:.m . other probl,:rr,,
e'111M, the in -depth in;i :oration at T ce ortClnartc *t'pdatu.. iklsnae > Lam a ld decide - ;ou reap} %%ant,
und : :r guise of increasing e f ioicncy, to make so many questionable changes to our C h :irtor. The claimed
gains in ` ufficiency" lim..it your rights and expand the C UY's pulvers.
Vote NO on Measure Lh.
2ober C. HaH kins ( t t
Past Chair, NwAport Beach Planning Comm ssion ti
� a
\o,.ell Hendrickson ! w2( i� [ .,4i ,..: � - ��t ! AD_ e'
Past Chair. \ \\ ort Beach Ciry yet Co n ssiol ; / C�
Lucihe Kuehn _ �
w T
Pormc: r' VcN port Beach City Council Member � ti
CD
Jim Mosher
ti� r L 1 t.
Community Activist
Ron He:tdrickson
40 Year \ec�port Beach Resident
C 2 :`io Cie p_t 7� cn bit^ vwr,°3
a .bc�plvse,;01�=