- Mendocino County
- Anderson Valley
by Mark Scaramella, August 10, 2016
My brother was diagnosed with terminal prostate cancer in December of 2013, the same month he had planned to retire from County employment, having achieved the grand age of 65. Hugh had a law degree and he was bilingual. Before working for the County he was an administrative law judge in for welfare appeals in Sacramento in the 1980s. He had worked for the county as an eligibility worker, trainer, analyst, and hearing officer for the last 15 years of his life under a parade of mostly inept Social Services managers.
He died in July of 2014 having used up his accrued vacation, accrued sick time, and a few weeks of disability. (He made all these detailed arrangements from his sick bed with his cell phone, having been a go-to expert for government benefits most of his life.)
Hugh would have been eligible for his pension in July of 2014, but he died before he received any pension benefits, saving the the County the $17,000 annual pension he would have received for what the actuaries estimated to be at least 20 more years of life.
My brother was representative of the low end of County pensioners; not many people would begrudge him and his fellow line workers their modest pensions, much of which comes from money they paid into for years through paycheck deductions. (My brother's pension would have been larger had he worked for the county for more than the 15 years).
But there are County pensioners we might well begrudge because dozens of Mendoland's recently retired top officials and salary earners, many of them cops, are getting yearly pensions in retirement which are at least three times what most active wage earning Mendocino County residents earn.
A few other noteworthy pensions:
County Auditor Meredith Ford retired with a medical condition which magically bumped her pension up, wayyyyyy up. But $180k a year?
Retired Sheriff Tony Craver retired in the 1990s with a back problem perhaps caused by being shrieked at by the eco-hags at Earth First! Demonstrations on the Coast.
In total, Mendo's top 20 pensioners cost the County's grotesquely overdrawn pension fund over $2 million a year in retirement pay-outs.
The County of Mendocino has been fiscally profligate for years. Tens of millions of dollars were handed over to the Ortner Management Group in the wake of an obvious inside job arranged by former Ortner executive Tom Pinizzotto who the County hired to steer its freshly privatized mental-health services contract to his old pals at Ortner. The County, after three years of privatization, is left with a chaotic array of mostly undelivered mental health services and roughly $40 million public dollars diverted to a private business based in Yuba City.
The self-appointed critics of County pension indebtedness, Ted Stephens and John Dickerson pop up every few years to point out the obvious — the County's pension fund, like many public pension funds around the state, has bankrupted the County and has created so much debt that the County has to divert more and more general fund money to it simply to keep on paying the pensions it is presently obligated to pay.
The critics are otherwise absent on other fiscal issues.
Not a peep of protest from the pension critics or their backers at the Farm Bureau over the Ortner fiasco and the routine spending misfires casually endorsed month after month by the Board of Supervisors. Why? The critics are rightwing libertarians opposed to government period, especially public employee unions.
In these very dry years, Mendocino County is constantly at risk of a large wildfire on the order of the fires that occurred in Lake County two years ago. The risk is increased by the obvious hazard posed by the thousands of acres of standing dead hardwoods on Mendocino Redwood Company timber holdings. Such a fire would not only devastate large swaths of scorched earth, but would make significant demands on the County's reserves.
Again, not a word from the pension critics.
Underpaid patrol deputies make it very difficult for the Sheriff to recruit adequate staff and provide basic law enforcement in sprawling Mendocino County. Also, no comment from the pension critics or the Farm Bureau who seem to think more money should be taken from law enforcement to pay down the pension deficit.
There are also outside factors, such as the highly volatile stock market where most of Mendocino County's pension funds are invested. The last time the stock market nose-dived in 2008-2009, Mendo lost millions of dollars of asset value in a matter of months. It will dive again, count on it.
The local pension critics are correct that the County's pension obligation outpaces the combined employee/employer contributions and stock market increases causing the deficit to get bigger every year. They are also correct that the people in charge of the County's pension fund are mostly self-interested County employees and former County employees who have no interest in doing anything that would lower their own pensions.
But the closest thing to a specific proposal that the critics have come up with so far is: "Stop the madness" — vague, of course, and a genuine impossibility.
* * *
A few years ago the County eliminated the discretionary health insurance they previously provided to under-65 year old retirees. They've also instituted a new retirement tier for new hires that switches them from "defined benefit" plans (like the one most senior employees now get) to "defined contribution" plans which translates to Wall Street deciding what your pension will actually be. Those steps made a small dent in the pension deficit.
If there are other steps the County could take within the law to make even a minor dent in the ever-increasing deficit they have not been forthcoming because things like capping pensions, disputing high disability claims (which are downright fraudulent in some cases here), reducing the high salaries of top executives (thus reducing the pension burden when they retire) are off the table.
The County could pay more into the system out of the General Fund, but they'd have to cut somewhere else to do it.
Such changes are about as likely as the USA switching to single-payer health care. (Which by the by, would make the County — among many others — instantly solvent overnight, but we digress.)
Like every other pension system in the state and the nation, public and private, Mendo's pension system certainly looks like a well entrenched, unavoidable trainwreck which cannot continue indefinitely and which any reasonably skilled green-eye-shader could see. But a large majority of Mendo's pensioners receive relatively modest pensions, much of which they paid into themselves. The pension critics never mention them and any cuts to those benefits would be met with legitimate opposition.
Unfortunately most of the pension problem originated years ago beginning primarily with the ill-fated "Slavin Study" which not only bumped all county employee salaries way up (including management, of course), but also bumped up pensions to unsustainable levels. Since then incremental increases, along with salary tricks which further bump up salaries in an employee's final years (aka "spiking") have brought us to this ever-worsening pass.
Most of us would be open to proposals from Ted Stephens or John Dickerson and their Farm Bureau associates to, for example, make it more difficult for top officials to spike their salaries and pensions in their final years of employment. We'd also like to see them propose a way to limit the "disability" pension abuse which the retirement board routinely approves because it's more expensive to hire doctors and lawyers to try to dispute them than it is to simply roll over and approve a ridiculously high disability pension. Trouble is, when the Retirement Board rolls over and approves a "stress benefit" or the like for one of their former fellow employees, the County usually ends up paying for years and years — unless, like my brother, they die prematurely.
Mendocino County's pension system is actually not much worse than other county pension systems, many of which suffer from similar problems. So it's unfair to act as if the County could take any practical steps beyond what's already been done to significantly reduce the deficit.
We are left with yet another looming financial crisis which, not only is beyond reform, but which could easily be a lot worse in the near future. Maybe, rather than complaining about it every few months, the critics should be glad it's lasted this long.