Special District? Special Deal
The Pleasant Valley Recreation and Park District is a mid-sized independent special district separate from the city of Camarillo.
It owns and maintains parks covering 300 acres. The district is governed by a board consisting of five publicly elected directors and managed by the district’s general manager, whose annual salary is $182,800, including car and phone allowances.
Ventura County Taxpayers Association began looking at PVRPD after noticing a July 2011 article in The Star. In what should have been a routine approval of the district’s annual 2011-12 budget by the board, one elected director voted no — on principle.
Director Mark Malloy, the lone dissenting vote, was upset the board failed to address the issue of ever-increasing employee pension and health care costs.
According to Malloy, “there is not an agency in town that extends those kinds of benefits to its employees and not ask them to contribute. No one on the board ever wants to talk about it, but if the community knew what we were doing, they would be upset.”
It turns out Malloy has a point and taxpayers should be more than a little upset.
In contrast to general-purpose local governments, a special district such as PVRPD often operates in relative obscurity, hidden from scrutiny of the public it was created to serve.
Equally important, the media, interest groups and active citizens, who frequently observe the actions of city and county governments, understandably do not participate at the same level in special district governance.
There was little public scrutiny in 2007 when the board voted to increase pension benefits for employees 25 percent and reduce the retirement age from 60 to 55 — retroactive to their first day on the job. The results of this misguided vote were predictable and expensive — pension costs soared 230 percent in less than five years.
The questionable decision to increase pensions was based on a staff reports recommendation from District General Manager Daniel LaBrado. The report assured directors that “most agencies have a 2.5 percent at 55 years old” formula and increasing pension benefits “would have no fiscal impact” on the district because “employees would pay” the rate increase.
Had the directors taken the time to independently check that information, they might have discovered these assertions were incorrect and voted differently. Instead, money that should have been devoted to park maintenance and improvements is diverted to fund an unusually generous pension plan.
VCTA reviewed the website of the California Controller’s Office to determine if most agencies do in fact have the 2.5 percent at 55 plan. We found 46 special districts and 10 cities located within the county of Ventura. And, contrary to what LaBrado told the board, VCTA found only three special districts (plus PVRPD) and two small cities that offer the overly generous plan.
The other 52 agencies, excluding public safety, all offer lower-costing pension plans to their employees. The staff report was clearly wrong.
LaBrado’s contract ends in 2013 with a guaranteed minimum $200,738 salary, which includes car and phone allowances. Assuming he retires with 30 years of CalPERS service, VCTA estimates (and it is an estimate) his six-digit pension will be $37,058 higher each year because of the change he recommended.
The board has been generous with taxpayers’ money, but refuses to even talk about having employees contribute toward their cost. Existing employees pay only 2.2 percent of their salaries for their unusually generous pension and pay nothing for medical, dental and vision insurance.
Rather than facing the issue of rising benefit costs, the board is using attrition to replace full-time employees with outside contractors. Apparently, this is easier than addressing the issue of employees sharing the cost of those benefits.
The board cannot reverse its decision to unnecessarily increase pension benefits, but it can require employees to pay for benefits so few in the county have. We urge the board to take action to do the following:
n Require all employees immediately pay their full 7 percent share toward pension.
n Require all employees contribute toward health care insurance premiums.
Because of their relative obscurity, when problems do occur at special districts, it often does not come to the attention of the public or elected officials until they are egregious and the remedies drastic. When they do surface, elected officials take center stage.
Democratic government is not designed to function in obscurity or anonymity, and we agree and support Director Malloy’s statement that “if the community knew what we were doing, they would be upset.”