City Council Meeting Tuesday Night

Fullerton City Council Meeting August 7, 2012 at 6:30PM at City Hall, 303 W. Commonwealth Ave

The Agenda has some big-ticket items that you should be aware of.  Among them is the massive issue of water rates and determining what costs should be appropriately charged to the Water Fund.  

There are a total of 27 items on the agenda and I hope to hear you speak about them.  Your voice matters so please speak up.

Click HERE for the Agenda!

OC Register Columnist Avoids the Obvious

OC Register columnist David Whiting shows the same trait as the Fullerton City Council members being recalled- denial.

Whiting gives his impression of the Fullerton recall election and the reaction of the public since the video was released.

While Whiting is entitled to express his opinion, he chose to use his creative writing skills over his journalist skills to express his support of the three doomed council members Jones, Bankhead, and McKinley.

I suppose when the facts are present, one need only close their eyes and the facts go away.  I'm sure my toddler would agree.

Unfortunately, sticking one's head in the sand doesn't resolve anything.  It only drags out the inevitable demise that is certain to follow.

Whiting gives the before and after impressions of the soon-to-be ex-councilmen and uses some mild quotes. He ignores, as city council candidate Matt Rowe pointed out, numerous tasteless, insensitive, and demeaning comments made by McKinley.  Bankhead and Jones also made plenty of similar remarks that have reflected poorly on our city.

From Matt's Facebook post at the OC Register on-line:

Here's some better quotes for Councilman McKinley.
---
Theme: Compassion
On sexual assault and the FPD (Rincon).
"Those ladies weren't people like this." 
This is not compassion. This is judgement. Does Pat McKinley side with the victims here or with the officer? You decide, then read the next one.
"It was just inappropriate touching. Not a good thing, but it ain't a dangerous thing."
This is not compassion. Pat McKinley actively dismissed what it feels like to be sexually assaulted and defended the officer's actions. Need more, read below. 

On Kelly Thomas.
"You can't get six people around one guy."
This is not compassion. This is attacking witnesses to the crime. As the video demonstrates, you can certainly get six officers on one guy. They piled on and crushed Kelly to death. Again, this is not compassion, this is Pat McKinley defending the FPD on national television. Need more?
"I've had my eyes bloused a few times myself... facial injuries are not life threatening."
This is not compassion. This is Pat McKinley minimizing the injuries that Kelly Thomas received. He's making a foray into medicine and is not acting appropriately for a councilman. No eye blousing every received by Pat McKinley should EVER be compared to Kelly Thomas's injuries. Need more?
"I can guarantee neither of these officers intended for Kelly Thomas to die. They had no intention of murdering him."
THIS IS NOT COMPASSION. This is Pat McKinley, again, sticking his nose where it doesn't belong. He has no idea what the officers' intent was. Here he is AGAIN advocating for the FPD and not advocating for a citizen of Fullerton, a victim of the FPD. Still need more?
"This should be an interesting trial and Mr Barnett is an extremely competent lawyer, and he has said that he has other information."
This is not compassion. This is Pat McKinley alluding to evidence held by the defense that may exonerate the officers. He has no business stating this, true or untrue. He's supposed to be advocating for citizens, for Fullerton, and for victims of crime inside the city limits. Making a statement about how good the defense attorney is and how interesting he's going to make the trial is not compassion. If it is, it's only for the FPD.
---
Theme: Police Discipline:
"I probably hired them all."
Yup. You probably trained them, too. Not exactly who I want ensuring my rights aren't violated.
"We changed the entire culture of the department."
I have no doubt you did.
"We put Rincon on administrative leave, immediately."
Really? This is a lie. Pat McKinley left Rincon on the job after receiving multiple complaints. He assaulted many many women. What did Pat McKinley do about it? He left him on the street, retired, then blamed the incoming police chief. View it yourself.
http://www.youtube.com/watch?v=Mg3uCUnivlU&feature=youtu.be
---
I have no idea why the person writing this article wrote what they did. What I can tell you is that we're not all on the same page. The quotes presented by the author, at best, occurred weeks and months after Kelly was killed. What the author should be presenting is what the council members said before the press got a hold of the case. That's the justification for the recall.
I guess this really sums up the reporter's journalistic ability: "As one speaker in council chambers put it, 'The world is watching this meeting.' I'm not so sure about the world."
The speaker was Ron Thomas. The world is most definitely watching. 10 million views and counting.
YES ON RECALL.

Well said Matt!  

Sticking our head in the sands of Fullerton have left us with over $1-BILLION of debt, no less than a dozen law suits, several former police employees incarcerated or on trial, accounting gimmicks and misappropriation of public funds, illegal taxes, and a blood on our streets.  \

The only cure for Fullerton's failed leadership is to replace the council with competent and caring leaders who will not look the other way while Rome is burning.

CAUSE: head in sand, EFFECT: (see images below)

A DUI crash mock-up. Unlike many

other Fullerton images, no one died

or was injured in this picture.

Water Rate Study Ad Hoc Committee Meeting Canceled

The Water Rate Study Ad Hoc Committee meeting has been canceled with no reason given.

The meeting was scheduled for this Wednesday but City manager Joe Felz canceled the meeting.  No reason was given.

The meeting would have been held to review the City Manager's list of "costs" associated with operating the City's Water Department and determine how much should be billed to the Water Fund.

Meanwhile, Fullerton Water Department customers are still being overcharged 10% on their water bills.  

City Council Meeting Tonight - Tuesday May 1

Please come to tonight's City Council meeting and be heard!  

DEBT

Tonight's agenda includes a revised debt obligation report (Item 3) showing the City's Redevelopment debt at $625,165,719.  MORE THAN HALF A BILLION OF DEBT!  This gem is in the Consent Calendar which means the report can be approved with other actions in one motion.  Ask for Item 3 to be pulled from the consent calendar so that we can tell the City Council that $625,165,719 is too much debt.

BUDGET

Also on the agenda is the Revised Budget for Fiscal Year 2012-13.  The revised budget relies on using City reserves to close the structural deficit of at least $1.5-million and make the broad assumption that your water bill will remain the same or go up.  It addresses the 10% cut by the City Council when they halted the illegal water tax however it assumes that there will be two new "fees" in the tax's place to "recover costs" that do not exist.  You and I will continue to pay more and as soon-to-be-Recalled Councilman Dick Jones suggested, the illegal water tax has two new names: Right of Way Impact Fee and Property Lease Fee.

You would think after the backlash over these artificially created "costs" that they would have forgone the fees and dealt with reality.  No.  Business as usual.

SOCIAL ENGINEERING

The General Plan Update or Fullerton Plan is also on the agenda (Item 7).  Depending on your view of social engineering, the General Plan Update may be great or terrible.

I don't like social engineering and therefore am inclined to disagree with the update.  The update incorporates many of the far left's goals to get people walking and cycling by penalizing those who operate gasoline powered  vehicles.  The word "sustainable" is used about as often as "green".  And we know how well these "green" initiatives have worked for the City with the installation of the Library's solar array.

As the name implies, it's all about "cap & trade".  CAP or Climate Action Plan makes the broad assumption that man has changed the Earth's climate and laws like this will change it back.  For that matter, there are several issues with the CAP but I'll focus on just one today.  The software used to dream up the plan's data for cap and trade, greenhouse gas emissions, and other statistical data was developed and disseminated by the very organization that lobbied for AB32 (the Global Warming Solutions Act- as if we can solve the world's problems with one law in CA).  That sounds like a conflict of interest but I'll let you do your own homework and figure out the particulars.

Tow Trucks and Commercial Routes

After a barrage of complaints of selective enforcement that favored one tow company over another, we have  the issue of "Truck Routes" back on the agenda (Item 8).  According to the staff report, some revisions to the municipal code should resolve the problem.  However, the revisions are minor and do not address the larger problem: are tow trucks "commercial vehicles" and therefor required to adhere to the truck routes?

The revised code references the California Vehicle Code's definition of "commercial vehicle".  Here is the actual language:

260.  (a) A "commercial vehicle" is a motor vehicle of a type required to be registered under this code used or maintained for the transportation of persons for hire, compensation, or profit or designed, used, or maintained primarily for the transportation of property. 

(b) Passenger vehicles and house cars that are not used for the transportation of persons for hire, compensation, or profit are not commercial vehicles. This subdivision shall not apply to Chapter 4 (commencing with Section 6700) of Division 3. 

(c) Any vanpool vehicle is not a commercial vehicle. 

(d) The definition of a commercial vehicle in this section does not apply to Chapter 7 (commencing with Section 15200) of Division 6.

This means that all tow trucks, delivery vans, maid service cars, ice cream trucks, plumbers, general contractors, electricians, or any vehicles that advertise a company or service and weigh 10,000 pounds or more are not permitted to travel in the City except along designated truck routes.

Of course there is a nice exemption for any vehicles being operated by city contractors, such as their contract tow company.  I see no changes that will resolve the issue of selective enforcement.  The municipal code gives tacit approval for Fullerton Police Officers to chase tow truck competition out of Fullerton and disenfranchising private business.  Only the City's contractor has free reign over Fullerton.

Conclusion

Clearly we are faced yet again with an agenda that supports a select few and contains little connection with the reality facing Fullerton's residents and business owners.  

Voters will have an opportunity to make a difference on June 5th by RECALLING Jones, Bankhead, and McKinley.  

Water Tax Repealed, Rate Decrease Anticipated

The City Council voted 5-0 to do the right thing: Rescind the 1970 City Council Resolution that granted an automatic transfer of 10% of gross water sales to the General Fund.  The money was then used to cover General Fund obligations, 80% of which is for salaries, benefits, and pensions.

The end of the water tax does not mean the automatic reduction of 10% of ratepayers water bills.

That will be explored by the Water Rate Ad Hoc Committee in the coming weeks.

For now, though, let's savor the moment.

One year ago I said that ending the water tax would allow for ratepayers' money to go where they had intended it to be spent, the water system.  "Oh no.  That would mean a $2.5 million cut to the General Fund" said the tax's supporters.  "We can't have that!"

The fact is, that money was not supposed to be going into the General Fund and reliance on those funds demonstrates a clear disregard of fiduciary responsibilities by our city officials.

The money was earmarked for water purposes and any other use is a clear misappropriation of public funds.  Suddenly with the water tax gone, the Water Fund has all the money necessary to begin replacing 4 to 6 miles of pipe per year instead of 1 mile per year.  This is a leap in the right direction.  However, there is much more work ahead.

You can expect another tax and spend plan to come forward to try to make up the $2.5 million annual cut in illegal funding.

Keep a wary eye out for gimmicks, games, and gambling with your money by city officials and vote June 5 to recall Bankhead, Jones, and McKinley.

Water Rate Study Ad Hoc Committee Calls On Council to Rescind Water Tax

Last night the Water Rate Study Ad Hoc Committee voted unanimously to recommend to the Fullerton city Council that the "in-lieu" franchise fee, or "water tax" as it has become known as, should be suspended indefinitely.

Another motion was made to recommend an audit of the Water Fund.  The motion failed 5-5.

Some members stated they had enough reports and felt spending more money would not provide any answers.  One member even said that no matter what is discovered in the audit, it would not be enough for some.

Others, like myself, feel it is a disservice to the public to not account for the misappropriated funds.  As we look to answer the question of how much was overcharged to ratepayers, we realize we cannot arrive at a fact-based answer.  Instead, the city's staff will have the Ad Hoc Committee look at what could or perhaps should be charged to the Water Fund.  That may be an appropriate step going forward but without an audit we will never know where our money went.

Water System Manager Dave Schickling offered up the City's Comprehensive Annual Financial Report as an audit that covered the Water Fund.  Unfortunately, the CAFR does not look at the Water Fund in any detail.  Instead, the accounting consultant was provided total dollars into and out of the Water Fund.  This may show that the Fund is operating in the black but does nothing to ensure that the transfers were legal or that the funds were used in support of water projects and system management.

I asked the Director of Engineering, Don Hoppe, and the Water System Manager, Dave Schickling, about how Maintenance Services bills their time to repair water leaks and the street that they dig up.  They said the time is all billed to the General Fund.  At the May 23, 2011 meeting the Water Rate Study showed that Maintenance Service accounted for 21% of the operations and maintenance of the water system.  This created some confusion, at least for me, because the Rate Study showed these maintenance costs as being part of the allocation from the Water Fund and not part of the franchise fee.  In the end, I am left to guess where at least $22.5-million was spent.

The chart below shows that Maintenance Services expenses accounted for 21% of the O&M expenses, "Other Expenses" as 2% (read the footnote on the chart to see what "other" refers to), and then the Franchise Charge at 11%.  According to the City, this chart represents all of the costs and expenses necessary to operate the Water System and consequently the Water Fund.

City Manager Joe Felz will be compiling what he believes to be a list a various "costs" to bring back before the Ad Hoc Committee.  The purpose would be for the Ad Hoc Committee to determine what "costs" are appropriately associated with and billed back to the Water Fund.

The Ad Hoc committee seemed somewhat unified in a desire to have only the actual costs billed to the Water Fund, but as we have seen, those "costs" are subject to staff interpretation.

Since last night's meeting, many members have expressed their concern over the way the entire Water Rate Study has been handled.

I think a large part of the problem has been the business-as-usual approach by staff to have a committee rubber stamp studies, reports, and recommendations all at the behest of city staff.

That's not to say the process yielded no results.  In fact, early in 2011 I made it my goal to end the water tax.  Last night, the first milestone was reached with the Ad Hoc Committee's recommendation.

As a final thought on water rates and the City's handling of this issue, I want to draw your attention to the City's Budget Study Session tomorrow.  The purpose of the meeting is for the City Manager and department managers to present their respective budgets.  This is where we find out how much of our money the City would like to spend and where they will spend it.  Even though the Ad Hoc Committee recommended that the City Council end the water tax completely, the City Manager, Joe Felz, intends to move the budget forward on the assumption that the General Fund will continue to receive a percentage of the Water Funds revenue.  So you see it is business as usual at the Fullerton City Hall.

Business as usual left us with an $8-million budget gap in the two-year budget for 2011/2012 and 2012/2013.    The proposed budget for 2012/2013 & 2013/2014 will have a $5-million deficit with the ending of the water tax and the official plan is to ignore it.

Water Rate Study Ad Hoc Committee Meeting Tonight

Water Rate Study Ad Hoc Committee meeting tonight

City Yard (1580 W. Commonwealth Ave.)

6:00PM 

Park in the gated employee parking lot

Please bring your neighbors and speak up.

Double taxation: Water Fund is City Hall's Go-To Cash Cow

How would you feel if money you paid for your water bill was used for something other than production and delivery of water?  Would it bother you that the City wasn't investing it in the water system?  It should.

August 18, 1998, the Fullerton City Council voted unanimously to transfer $250,506 from the Water Fund to pay for 1/3 of the City's portion of the total cost to seismically retrofit the PD and City Hall.  

Plenty of people raised valid questions and yet the resolution passed after Administrative Services Director Meyer noted that the Water Department uses office space at City Hall.

This transfer was in addition to the 10% water tax of $1,408,961 for FY1997-1998!  


But wait!  Wasn't the franchise fee supposed to cover costs associated with the Water Department's use of office space at City Hall?  


We just got taxed twice.  

City of Fullerton Gets Facts Wrong

My inbox alerted me that the City's latest Focus On Fullerton newsletter published by City Hall had been deposited.

Perusing the topics I found a "A Q&A: "Understanding the City's water fund transfer".  It sounded pretty honest until I got to this part:

Q: I have heard the City’s water franchise fee described as “illegal,” is this true?

Cities are entitled to recover all of their costs for utility services through their water service fees, including costs provided by the General Fund in support of the water utility. The City has determined, however, that it is appropriate to identify and quantify rather than estimate the direct charges that should be assessed to the Water Fund for the use of City-owned property and facilities in support of water system operations. The City engaged an independent rate consultant for this purpose.

As you might expect, I take issue with the answer.

First, the city did NOT determine that it is appropriate to identify and quantify rather than estimate the direct charges that should be assessed to the Water fund.  No, it was the Howard Jarvis Taxpayers Association and California Courts that determined activities similar to those practiced by City Hall were illegal.

Second, it is absurd to think that Municipal & Financial Services, Inc. is an independent consultant.  This is the same firm that conducted the Rate Study last year and who told the Water Rate Study Ad Hoc committee that we shouldn't ask questions about the franchise fee because we''l be "opening a can of worms."  I'm confident that M&FS did exactly what they were hired to do: justify as much of the transfer as they could articulate.

So, while the City chooses to dance around the subject and smooth over the problem with distractions, I'll answer the question... YES, THE FRANCHISE FEE IS ILLEGAL AND IT IS STILL IN PRACTICE IN FULLERTON.

On a "minor" side note, the City also incorrectly tells us that we can only bring up the issue when it is on the City Council Agenda:

Does the public have any say?
Yes, members of the public may speak at Ad Hoc Water Rate Study Committee and City Council meetings when the item is agenized. They may also write letters to the City Council.

This is another piece of bad or erroneous information.  The public may speak to the City Council about anything within the Council's purview, such as water rates, rebates, and franchise fees even if the issue is not on the agenda.  This is what the PUBLIC COMMENTS section of the City Council meeting is reserved for.  You have a legal right to speak before your elected representatives whom serve you.

There are a few other topics in this issue of Focus On Fullerton which I take issue with and will bring up before the City Council tonight.  The meeting starts at 6:30PM with several presentations and proclamations.

Fast Facts About Fullerton

Here are a few fast facts about Fullerton:

400 - the number of years it will take to replace that water line in the street (current replacement cycle should be 6 miles per year on 50-year cycle)
547.6 - millions of dollars of pension liability (CAFR 2011, page 69)
657.9 - millions of dollars of Redevelopment Agency liability (March 20, 2011 agenda item 6: "PROPOSED THIRD AMENDMENT TO ENFORCEABLE OBLIGATION PAYMENT")
91 - the percentage of increase in water rates proposed by City of Fullerton May 23, 2011
2,000 - approximate dollars paid per month in daily stipends to Councilman Bankhead as a Director on the Orange County Water District Board (City Council Agenda Item 12, April 3, 2012)
27 - millions of dollars skimmed since 1997 from the Water Fund to pay for salaries and benefits of employees not associated with the water department  (Public Records Request data from Julia James, Administrative Services Director, City of Fullerton)
2.7 - millions of dollars the City plans to skim June 2012 (Based on Adopted Budget FY2011-2012)
64 - days left for you to decide if you want to change any of these numbers (Recall Election June 5, 2012)

MARK YOUR CALENDAR - More meetings...

The Citizens Infrastructure Review Committee (CIRC) is scheduled to meet on Wednesday, April 4, at 6pm in the City Council Conference Room.  This is a PUBLIC meeting and PUBLIC COMMENTS are encouraged.

What does the CIRC do?  As the name implies, the committee reviews the City's infrastructure program also known as the Capital Improvement Program.  We look at prioritizing projects, funding sources, and act as the ears for the City Council.  The committee serves as an advisory body and has no authority to do anything accept approve previous meeting minutes and make recommendations to the City Council.

The Water Rate Study Ad Hoc Committee is scheduled to meet on Monday, April 9, at 6pm in the Main Branch Library.   This is a PUBLIC meeting and PUBLIC COMMENTS are encouraged.  

The Ad Hoc was formed to vet the initial water rate study which was conducted in 2010 and reviewed by the committee in 2011.  As part of the study, the committee asked questions about the in-lieu franchise fee ($2.7-million water tax).

The Ad Hoc is made up of two committees, CIRC and the Energy and Resource Management Committee (E&RC), as well as 5 community members.  Many of the CIRC and E&RC members have chosen not to participate for personal reasons such as scheduling and the depth of commitment necessary.

MARK YOUR CALENDAR - Water Rate Ad Hoc Meeting April 9th at 6PM, City Yard

Where is your money going?

The next Water Rate Study Ad Hoc Committee meeting is scheduled for Monday, April 9th at 6PM at the City Yard (Basque & Commonwealth).

Please attend this important meeting and speak up.  If you have ever wondered why Fullerton was in this mess it is because too often we all sit back and expect someone else to do all of the work.  Please do your part and engage in the discussion.

Do you think using your water rates to pay for "rent" of city-owned property is a bad idea?  Do you want a refund of the money you were over charged?  Do you want the City to actually use ALL of the money they collect from water sales do be spent on the Water System?  Are you upset that the Water System has been neglected?  Are you fearful the City will try other tricks and accounting gimmicks to take more of your money and provide fewer services?

Please mark your calendar and bring your neighbors.  Fullerton is YOUR city.  

Water Main Breaks In Front of Water Reformer's House

The irony, astonishing.  The coincidence, unnerving.  The big picture, never clearer.

If you could choose a place to break a water line, would this be at the top or bottom of the list?  It's in front of my house...again!

This is just around the corner from the house that exploded yesterday and has many questioning the water systems integrity and capability when taxed with fire services.  Did the sudden demand on the system place too much stress on the water lines?  One would think so but I have not been able to speak with the Water System Manager, Dave Schickling, or the City Engineer, Don Hoppe, to ask.

After you and I have contributed $27-million through the water tax since 1996 to the City's General Fund, you would think the City would have this under control.

A City of Fullerton representative contacted my wife to tell her that, because the leak is slow, they'll be out TOMORROW, on a Saturday, to fix the line.  Can you say OVERTIME?  Seriously.

If the City was ever going to try to demonstrate water efficiency and commonsense responsible water management, you would think they might want to expedite a water main break.  I wonder how many other breaks occurred since yesterday...

Neighbor's driveway is barricaded 

Water Rate Study Ad Hoc Committee Update

The new conference center at the Main Branch Library was full of City Council candidates.  Also in the back row was Councilman Don Bankhead, who I am running to replace should voters recall him on June 5.  

Thank you to everyone who took time out of their lives to join me at the meeting.  The discussion was lively and comments were appreciated.

There seems to be two camps brewing, though it may still be too early to know.  One position is that any rent-back of City-owned property to the City is illogical and amounts to a double tax.  The other position is that some rent-back is justified.  

I'm of the opinion that we (taxpayers and ratepayers) have already paid for these facilities and that renting them back to the City is wrong and amounts to a double tax.  

With so much material to review and interesting comments by all, no action was taken by the committee.  The transfer study will be further discussed in a couple of weeks along with possible recommendations to the City Council on what to do with the surplus cash from overcharges to ratepayers.

Also, I asked that we place on the agenda discussion and, possibly, a vote on recommending that the City completely forgo any transfers to the General Fund until an audit of the fund is complete.   Speaking of audits, the transfer study was not an audit by any stretch of the imagination.  Therefore, an audit of the General Fund is necessary. 

Stay tuned for more information in coming days...

Water Rate Hike Hearing...Will you be heard?

Tonight the Fullerton City Council will take up, among many issues, water rate hikes.

I oppose the so-called "pass-through" rate increase for a few reasons.

First, the pass-through is supposed to pass along rate increases imposed on Fullerton by the Metropolitan Water District (MWD) and the Orange County Water District (OCWD).  Fullerton passes the increase to YOU 6 MONTHS BEFORE MWD or OCWD actually increase their rates.  If it isn't illegal, it should be.  At the very least, it is unethical.

Second, the MWD is neck deep in a law suit by the San Diego County Water Authority which is alleging that MWD staff together with some of the staff of MWD's member agencies (like Fullerton) have created a "Secret Society" that meets behind closed doors to develop policies and manipulate water rate increases.  

Third, the MWD is raising their rates to help cover $6,000 bonuses for ALL employees, raises that will amount to nearly 6%, and two new pay grades.  And for those who will think I'm picking on the poor defenseless public employee, let me remind you that all public employees work for ratepayers/taxpayers.  These bonuses and raises are being pushed onto water consumers without their input or approval.  The increases are coming in the midst of the worst economic disaster since the Great Depression.

Water is not like any other commodity.  We have no choice which water agency hooks up to our water meters.  It is of the greatest importance that those services which have monopolies over taxpayers are regulated sufficiently to ensure that they are free of corruption and malfeasance.  Taxpayers must be assured that they are receiving the highest level of service at a reasonable and sustainable rate.

Please attend the City Council meeting at 6:30PM at City Hall.  

Are Fullerton's Water Rates and the Proposed Rate Hikes Justified

Tonight is the Fullerton Water Rate Study Ad Hoc Committee meeting at the Main Branch Library at 6pm.

As a member of this committee, I would like to hear your thoughts and concerns on all things water related.

With a massive MWD scandal brewing that implicates Fullerton in even more corruption and with the recent revelation that Fullerton water ratepayers were over charged, I think it is important to hear what you, the ratepayers and voters, have to say.

Tomorrow, the Fullerton City Council will take up a water rate hike.  You have a say in the rate increase but you need to come and speak to the Council.

FULLERTON IS YOUR CITY.

Results from Study of 10% Water Tax Released

The City of Fullerton has released the findings of a study that looked at transfers of funds from the Water Fund to the General Fund.  In simple terms, this is the City's justification for skimming water revenue and using it for non-water related activities.

The study focused on the last three (3) years because legal counsel identified a three-year window of liability.

Here is the City's internal memo (click image to read):

Page 1 of 3

Page 2 of 3 

Page 3 of 3

The memo notes that over the last three years water ratepayers have overpaid $2.5-million. 

If you can accept the premise* of the report then the next logical question is what to do with the over payment.  This question will be the focus of the Water Rate Ad Hoc Committee over then next several weeks.

*The bulk of the $5-million that the City would like to retain is being justified as rent for the water system's use of City-owned properties and is payable to the City's General Fund.

This latest study of the franchise fee will be the topic of conversation at Monday's Water Rate Ad Hoc Committee meeting at the Main Branch Library at 6PM.  

The OC Watchdog Plays in Fullerton's Muddy Waters

The OC Watchdog jumped into Fullerton's muddy water tax again on Sunday. CLICK HERE TO READ THE OC WATCHDOG.

Let's not forget how the City has used the $2.5 million.  10% of every water bill gets diverted or skimmed from the water fund and transferred into the City's General Fund. 80% of the General Fund goes to cover public safety employee salaries and benefits. The General Fund does not contribute any funds back into the water system. Removing this hidden tax would allow the water system to retain about $2.5-million for pipe replacement.
http://gregsebourn.blogspot.com/2011/07/reasons-i-oppose-fullertons-water-rate.html

WAKE UP FULLERTON! The Water Fund isn't the only fund getting skimmed.
http://gregsebourn.blogspot.com/2011/08/where-did-all-money-go.html

And in case you forgot...

http://gregsebourn.blogspot.com/2011/08/illegal-taxes-and-misappropriations.html

North OC Conservative Coallition - Mark Your Calendar

The non-partisan North Orange County Conservative Coallition invites YOU...

NOCCC Upcoming Events

Please Mark Your Calendars and Plan To Join Us!

Thursday, March 15, 7pm at the Foxfire in Anaheim Hills

Do you know how many of our national and state laws and policies are actually not constitutional? Knowledge is power!

Please join us to meet and hear special guest speaker Professor John Eastman. Dr. Eastman is the Director of the Claremont Institute’s Center for Constitutional Jurisprudence and former Dean of Chapman University School of Law.

With guest emcee Constitutional Law Attorney Karen Lugo, founder of Libertas-West Project, contributing editor for FamilySecurityMatters.org and Assistant Director for the Claremont Institute’s Center for Constitutional Jurisprudence.

Thursday, April 12, 7pm at the Foxfire in Anaheim Hills

Get to know the candidates before you vote! All local candidates are invited to be introduced and a forum will be held for some races.

OC Register columnist Brian Calle will be our guest emcee and moderator. Brian is a Senior Fellow at the Claremont Institute, President of the Young Executives of America and editor of FreedomPolitics.com. Stay tuned for more information.

*We will also have important information on Precinct walking for your favorite candidate.

Citizen candidates wanted! Ever considered running for local office?

North Orange County has some excellent elected representatives, but it is always a good idea to embrace, mentor and support qualified residents who have the desire to step up to serve their community. This election season, GOP Central Committee, City Councils and School Boards all have open seats in Anaheim, Brea, La Habra, Orange, Placentia, Villa Park and Yorba Linda. North Orange County Conservative Coalition participants are among the most involved and informed folks in our county. If you ever thought you could be the one to make a difference and you would like more information, please email karladowning@aol.com.

Do you really know our U.S. Constitution?

Hillsdale College is offering a convenient online course - Constitution 101: “The Meaning and History of the Constitution”. The course launched Monday, February 20, but you are not too late to explore the site at your convenience and access materials.

Go to http://constitution.hillsdale.edu/

• Click the "Sign In" button at the top of the page
• Enter your email address under the "Already Registered?" section.
• Each lecture is pre-recorded and will be available to view at your convenience.
• You will receive an email each week informing you that new material, including the lecture (Monday) and Q&A session (Thursday), is available.

Please email constitution@hillsdale.edu with any questions you may have.

$62.1 BILLION - CalPERS Unfunded Liability

SACRAMENTO – State Controller John Chiang today released a new actuarial report showing the 30-year cost of providing health and dental benefits for state retirees is $62.1 billion.

"Even as California continues its struggle to get back on firm fiscal footing, we must begin to address our obligation to pay health and dental benefits for current and retired state employees," Chiang said.  "Even slight amounts set aside will help lessen the impact on future generations, and ensure that we fulfill our responsibilities to the state workforce and our taxpayers."

The unfunded obligation as of June 30, 2011, grew $2.2 billion from the $59.9 billion obligation identified as of June 30 2010.  The accrued liability grew less than expected due to favorable healthcare claim experiences linked to a combination of fewer claims, less expensive claims, less utilization of services, and the implementation of new California Public Employees' Retirement System’s (CalPERS) health programs designed to reduce costs.  

While state pensions are pre-funded, allowing investment returns to reduce liabilities, California pays for retiree health benefits on a "pay-as-you-go" basis, or the minimum amount needed to fund the costs as they are due.  The latest actuarial report estimates California’s obligation for retiree health and dental benefits, also referred to as Other Postemployment Benefits (OPEB), based on two different funding scenarios:

• The current pay-as-you-go policy results in an actuarial unfunded obligation of $62.1 billion, which represents the total the State would need to pay for future retiree health benefits earned as of June 30, 2011, by current and future state retirees.  Based on this unfunded obligation, California should pay $4.7 billion in 2011-12 to pay for present and future retiree health benefits. In the 2011-12 Budget Act, the State provided $1.71 billion to only cover current retirees' health and dental benefits.

• If the State shifted to fully pre-funding the costs of future benefits, the actuarial unfunded obligation would be cut by more than $21 billion to $40.7 billion.  Under a full pre-funding approach, the State would set aside money in a separate trust solely for future retirement health care benefits.  The investment income generated by the trust would be used to reduce the costs to the State and its employees of paying for future benefits. To take advantage of the tremendous cost savings resulting from fully-prefunding, the State would need to contribute $3.3 billion in 2011-12, or $1.6 billion more than the State currently pays.

Recognizing that fully funding the health and dental benefits obligation is unlikely given the State's tight budget, Controller Chiang noted that even incremental steps toward pre-funding the obligation would significantly reduce the State’s liability (see chart ).  For example, if the State pre-funded just 10 percent of its obligation, it would only need to pay $160 million more than its current pay-as-you-go contribution.  However, that additional payment would shave $2.7 billion off of the State's unfunded liability.

Pre-funding 25% of its obligations would cost the State $400 million more than the pay-as-you-go contribution, but would reduce the total unfunded liability by $6.54 billion.

In 2004, the Governmental Accounting Standards Board Statement 45 (GASB 45) required states and local governments to publicly disclose the future costs of paying for post-employment benefits other than pensions for current state retirees and employees.  Chiang commissioned California’s first report shortly after taking office in 2007.  This report is the fifth to be issued under his administration.

While GASB 45 does not require states to fully fund its obligations, all three credit rating agencies have urged states to at least have a funding plan in place to avoid any future downgrades.

The actuarial report  and a chart  showing how much pre-funding would cut future costs can be found on the Controller's website at www.sco.ca.gov.