2009 14th Annual Goldens


City of San Diego: Pension Reform and Tough Cuts to Compensation
Recognizing that unsustainable compensation costs are largely responsible for the City’s dire financial situation, the Mayor and City Council have implemented some tough decisions that will positively impact San Diego taxpayers. In July 2008, Mayor Sanders, the City Council and union leadership reached agreement on pension reform avoiding placement of the issue on the November ballot which would have cost as much as $300,000. The retirement plan for new employees is expected to save the city a total of $36 million over the next ten years. More recently, in April 2009, the City Council unanimously approved cuts to compensation and benefits which will save the city an additional $34 million.



SANDAG: Safeguarding Capital Improvement Projects
While most capital improvement projects around the country were halted with the onset of the recession in October 2008, SANDAG recognized the importance of maintaining these projects in order to keep workers employed and to reduce expensive stop-start costs. By trading-out stimulus dollars for TransNet funds with local jurisdictions, SANDAG was able to keep regional projects moving and capitalize on the organization's experience in navigating the federal funding oversight process. This foresight saved the region millions of dollars and protected thousands of local jobs.



City of Escondido: Tough Cuts to Compensation
Faced with a $7.4 million budget deficit and in recognition of the fact that 80% of their general fund expenditures are comprised of employee compensation costs, the Escondido City Council opted to pursue the politically risky decision to impose new contracts on public employees, including police officers and firefighters. These cuts could potentially save the city approximately $800,000 by the end of the fiscal year June 30 and help to close the city’s projected $6.3 million budget deficit. The police union is now suing the City Council to renegotiate the contract. Rather than pursue revenue enhancement options or cave to union demands, the Council put the taxpayers first.



County of San Diego and Mental Health Systems, Inc.: Serial Inebriate Program (SIP)
The Serial Inebriate Program (SIP) offers treatment, shelter, and other supportive services to chronic public inebriates as an alternative to custody. By providing these services, the SIP diverts significant portions of the chronic public inebriates population from the streets and into treatment programs, saving San Diego County taxpayers more than $876,000 a year. This program is made possible by the collaboration of a wide range of agencies and organizations including: San Diego County Alcohol and Drug Services, local law enforcement, hospitals and Mental Health Systems, Inc.



City of San Diego: Audit Completion
After a series of dubious financial disclosures and securities laws violations dating back to 2003, the Securities and Exchange Commission issued a cease-and-desist order against the City in 2006. While the 2003 fiscal audit took three years to complete, the City was finally able to complete six years of backlogged audits in the past two years. Not only will the City now be able to save taxpayer dollars by attaining better interest rates in the public bond market, this is an important step towards increased transparency and accountability.



Will Carless, www.voiceofsandiego.org
“Without Oversight, SEDC Officials Award Themselves Bonuses”

I-Team, 10News
“City COO Puts Agency on Notice For Financial Decisions”



San Diego County Employees Retirement Association (SDCERA): Costly Hedge Fund Investments
In 2006, after the collapse of hedge fund Amaranth Advisors in which SDCERA had invested $175 million, the Taxpayers Association recommended a reduction in the level of exposure to risky hedge funds since taxpayers are left holding the bag should losses occur. The advice fell on deaf ears. It wasn’t until December of last year, after the Bernie Madoff scandal, that the pension board finally voted to reduce its exposure to these types of investments and acknowledged that the funds were too risky.

In fiscal 2008, the retirement agency spent $77.7 million in investment fees – more than twice as much, on a percentage basis, as CalPERS, the nation’s biggest pension. In return, the County’s pension fund barely outperformed a “policy index” which would have cost SDCERA a fraction of what it’s paying its money managers. Over the past 10 years, the pension fund’s high-risk strategy earned 3.2%. Meanwhile, the pension fund would have would have earned better returns in money market or Treasury bonds, which don’t require expensive supervision. It may be no coincidence that the County retirement board is seeking aggressive returns despite the risk. In 2002, the retroactive benefit increases granted by the County Board of Supervisors resulted in a gap of more than $1 billion in the pension fund, since no new revenue sources were tied to the benefit increases.



City and County of San Diego: Grantville Redevelopment Settlement
Together, the City and County of San Diego have successfully accomplished an epic bait-and-switch of redevelopment dollars. Under a legal settlement reached between the City and the County, $31.36 million in funds originally slated for the redevelopment of Grantville will be taken out of the project area and used to pay for improvements on the green-line trolley on “C” Street in downtown San Diego. In turn, the City’s Redevelopment Agency will pay the same amount of money to build a waterfront park on two County-owned parking lots on either side of the County Administration Building. The City claims that the green-line trolley serving Grantville is a “nexus” between Grantville and downtown. Since the green-line trolley ultimately connects to the blue-line trolley which serves downtown, Grantville residents will be encouraged to ride the trolley, thus easing congestion in Grantville. The settlement agreement also includes an additional $9.8 million from Grantville redevelopment to fund the County’s share of affordable housing. State Senator Christine Kehoe’s Senate Bill 93 will close this loophole so that future redevelopment agencies won’t be able to shift dollars out of a redevelopment area that don’t directly benefit the local residents.



City of La Mesa: Taxpayer-Funded Campaign for Tax Increase
Leading up to the November 2008 election, the City of La Mesa spent over $110,000 for the preparation and distribution of three “community update” mail pieces which were thinly veiled advocacy attempts to persuade voters to approve a proposed tax increase. While the City was claiming fiscal emergency, precious taxpayer dollars were used for one-sided “educational” pieces leading the Fair Political Practices Commission to cite La Mesa as an example of “pushing the limits with public outreach programs”.