Clarity Blog

Clarity Blog

Posts Tagged ‘unions’

Public Agencies and Public Benefits

We can’t tell you how many times we’ve read through the comments posted on a news article about the compensation and benefits paid to the employees of public agencies only to find a slew of comments about how the agencies “operate in secret” and “work behind closed doors.”

That always strikes us as funny, because the articles these readers are commenting on almost always came about because of some sort of public disclosure the agency is required to make. Lately, it’s been documentation compiled by the State Controller. Often, it’s based on Public Records Act request the agencies have received from reporters and have little choice but to comply with.  Or an agenda item at a public board meeting.  So, what secrets? What closed doors?

Still, the spotlight is on public agencies, and it’s going to stay there for a while before it moves on to make someone else uncomfortable. The effects of a tsunami of articles on public employee pensions, mid-six-figure compensation packages for agency heads and the growing unfunded pension obligations have made this a hot issue.  A recent poll by the Pew Research Center for the People & the Press (theoretically a non-partisan group), revealed the not-surprising finding that the public’s discontent with government employee pensions and benefits is rising, and that the most popular suggestion for how to cut government budget deficits is to cut spending on “pension plans of government employees.”

The issue is hitting home.  We saw this week that Helix Water District in suburban east San Diego County is the target of a citizen group, East County Tax Hawks.  The Hawks like the District’s water service just fine, but think the employee benefit package is way out of whack – at least 24 days of paid time off a year (above recognized holidays), 100% of health insurance costs paid by the District and “over the top” retirement benefits.

The District responded to these charges as well as they can, by comparing their benefits to other water agencies’ benefits, and showing how they’ve cut operating expenses.  At a recent public meeting, Helix’s board president, DeAna Verbeke, acknowledged the public’s concerns, stated the agency also is concerned … then added, “employees have rights too.”

Of course they do, but that message probably will do nothing to reduce the ire felt by the Hawks, who probably see public sector employee contracts more as gifts of public funds than as legitimate payment for work done.  That doesn’t mean they have to keep that opinion, or that their opinion should be parroted by others in the District. Avoiding that will take communication and clarity.  Districts are going to have to face this issue head-on or risk the election of new directors set on slashing expenses by unreasonable amounts.

Based on my 30 years in public affairs and crisis management, here are some suggestions for your consideration:

  • With all contracts, work with other public agencies to obtain apples-to-apples data and take board action to commit to being “average” in compensation and benefits.
  • Push employees to re-open contract negotiations that aren’t set to be re-opened soon.  They may refuse, but the public will appreciate the effort.
  • With employee compensation packages, focus on the trimmings, not the meat.  People expect rank-and-file employees to be fairly compensated, but don’t like overly generous frills in public employee contracts.  Paid off-days, health insurance costs and the like will be scrutinized.
  • Check your $100,000-plus pensions, which are the subject of particular scrutiny.  How many do you currently have; how many do you expect to have? How many years did those people work?  How much did the agency pay in?
  • Compare your GM and Board salaries, payments and perks to other agencies’ and be prepared to answer questions on anything that stands out from the crowd.
  • Expect scrutiny and be as prepared for it as you would be for an operational mishap.  Keep your compensation data on hand and up to date, and have messages prepared that anticipate the difficult questions you’re likely to receive.

If you’d like to discuss this further, give me – Laer – a call at 949/599-1212.

Laer’s Op/Ed on CalWatchdog

Laer is becoming quite the prolific op/ed writer.  His latest appeared today on the Pacific Research Institute’s CalWatchdog blog.  Here’s an enticing bit of it:

If Gov. Jerry Brown has any chance of draining California’s budget swamp of red ink, he’s going to need more than aggressive spending cuts and votes for more taxes, as he proposes. He’s also going to need a resurgence in California’s business environment, but at one of the state’s few commerce success stories, the ports of Los Angeles and Long Beach, there are more signs of classic California non-competitiveness than there are of a return to health for the state’s business sector.

Yes, activity is up by single digits over last year at the ports, which are America’s busiest, as companies slowly bring in more goods from Asia to rebuild inventories they had let drop through the Great Recession. But even as more than 12 million containers will be unloaded at Southern California docks this year, there are grave threats to the future of Southern California’s logistics behemoths, and they’re posed by exactly the same elements that threaten the rest of the state’s economy – powerful unions and California’s incessant compulsion to be a world leader in the environmental movement without thought to the cost.

Please read the rest of the op/ed by clicking through to CalWatchdog.

A Crystal Clear Message

In the world of political tea leaf reading, no brew is stronger than the appointments a recently inaugurated politician makes, so California’s political pundits – myself included – have been watching Jerry Brown very carefully.  And today there’s an extremely clear message in the bottom of my teacup.

One of the biggest questions asked of Brown is whether he’ll have the stomach for a fight with the public employee labor unions that paid for his campaign.  (Brown is independently quite wealthy, but unlike Meg Whitman, he didn’t spend a dime of his own money on his gubernatorial run.)  His appointment to the top job at the Department of Personnel Administration would be clear signal of whether there will be continued kowtowing to the powerful unions, or whether Brown would bite the hand that fed him and take the steps necessary to rein in out-of-control spending on public employee salaries, benefits and retirement programs.

Today, Brown as much as told us he sees continued groveling in his future as he appointed a big-time pro-labor lawyer, Ronald Yank, to the position.  Yank practiced law at the Carroll, Burdick & McDonough  law firm that has represented California’s prison and Highway Patrol officers and several powerful public employee unions.

Messages can be words or they can be actions – and we all know actions speak louder than words.  While Brown has talked about tough times and tough decisions ahead, his appointment of Yank tells us that he’s not planning on being too tough on the unions.  And that’s too bad for California.