Blog Archives

Additional Annexation Thoughts

Kudos to members of the Chico City Council for sticking to their guns and standing strong against the bully Local Area Formation Commission (LAFCo) on January 21! Instead of breaking and bowing to LAFCo’s threatening letter, you stood up for your constituents by directing your staff to work towards finding an alternate solution. Granted, Mayor Scott Gruendl sounded wishy-washy when he talked himself out of supporting LAFCo (at least that was my take); but all seven of you did end up voting correctly. How refreshing!

Last Tuesday, in the rush leading up to the Council meeting, we provided the Council with information about the history of the LAFCo issue that was conspicuously absent from Nakamura’s staff report. We then shared it with you in the post, Chapman, Mulberry and the LAFCo Stick. Now that the pressure is off, here are some additional thoughts about the City’s position on the annexation debate.

Before expounding further, I want to be clear that none of us at Truth Matters, Chico! has a horse in this race. We have no enduring loyalty to the City’s policies, and none of us lives in an unincorporated island within the boundaries of Chico’s Sphere of Influence.

Having established that whatever the outcome of this debate, we will not be personally impacted, following are some additional technical and historical data, as well as points of general information (and some opinions) for you to consider.

Disenfranchisement? – LAFCo has repeatedly accused the City of disenfranchising the residents of the Chapman Mulberry area, which LAFCo’s Board and staff consistently label a “low rent” district. The facts, however, do not support the claim. The City has also chosen NOT to annex the areas of El Monte Avenue and Chico Canyon Road, notably two of the most “high rent” districts in Chico’s Sphere of Influence.

Want to be annexed? – While annexation proceedings can be initiated by the City, there is absolutely nothing preventing any property owner from submitting an application for annexation. In fact, when a resident submits an application for sewer service, there is an opportunity to indicate interest in being annexed concurrently with sewer connection. So, if someone personally feels disenfranchised by living in a County pocket, the solution is as simple as going to City Hall and submitting an application! In fact, the required forms are provided on the City’s Planning Department website. Here are the links to the application for annexation only or the application for annexation with sewer connection. Disenfranchisement? I think not.

How does the City or Council know what their constituents want? – The City proposed, and the Council approved, the idea of initiating annexation proceedings for a County pocket upon receipt of 50% plus one requests for sewer hookup. One of the great things about that proposal is it operates as an informal survey. If every time the City receives an application for sewer service, it asks the applicant to indicate whether or not there is an interest in annexing the property, and/or to sign a Consent to Future Annexation to obtain the sewer connection, then obviously the data to determine whether property owners in a County pocket are ready to annex is being collected. Can you think of a better way?

Condition of infrastructure in County pockets? – There has always been a lot of back and forth between the City and County regarding infrastructure in County pockets. What I can attest to as documented truth is the Overall Condition Index (OCI) of the City’s streets, how that number was negatively impacted by the many annexations that have already occurred, and how that number will be further negatively impacted when the remaining County pockets are annexed.

One of my responsibilities as a City employee was the Pavement Management Program (PMP), which kept an eye on the overall condition of the City’s roads and prioritized repairs based on taxpayers receiving the most bang for their bucks. (There is a point of diminishing returns when it comes to road repairs.) Please bear with me – I am trying to not get too technical here, but this is important!

The PMP assigns a Pavement Condition Index (PCI) to sections of roadways by taking into account multiple variables. This data goes through a complex mathematical calculation, via a computer program, and produces a number between 1 and 100 (where 100 is perfect and 1 is completely failed), which identifies the “condition” of the pavement in each section of roadway. All of the PCIs combined determine the OCI – ultimately assigning one number to establish the quality of Chico’s pavement.

Before Chico annexed approximately 7,000 acres of County pockets, its OCI was in the mid-70s, in the Very Good category. After those annexations occurred, Chico’s OCI dropped to the high 50s, the mid-range in the Good category. While I was managing the PMP, we decided to survey all road sections in the remaining County pockets, so we would be prepared to add them into our road maintenance program upon annexation. This survey informed us that Chico’s OCI would take an additional hit, putting Chico’s roadway network at the higher end of the Poor category.

Sales Tax Agreements? – It is difficult to discuss the existing Sales Tax Agreements between the City and the County without sounding overly opinionated; so I will limit my comments to the fact that the Agreements do exist, and in my opinion, it would be imperative that these Sales Tax Agreements be revised or eliminated upon annexation of all County pockets within Chico’s Sphere of Influence. Unfortunately, since both the City and County are parties to the Agreements, both agencies would have to agree to a renegotiation of the terms.

LAFCo staff has been working with City staff for years without resolution? – I can attest to LAFCo’s assertion that it has been working with City and County staff for two to three years, attempting to resolve the annexation issue. Mind you, the term “working with” is being used very loosely. Meetings had been occurring; however, in my experience, for about the first year plus some months, LAFCo staff would brainstorm with City and County staff and agree to proposed solutions, and then make a 180-degree turn at their Board meetings. LAFCo staff would repeatedly blindside both City and County employees with unexpected declarations, and would provide agreements and/or other documentation to the LAFCo Board that had not been shared with the other impacted parties.

The LAFCo Board and staff also had a very different view of the sewer connections permitted within County pockets. The City and County had been working together for years in an effort to assist property owners in complying with the Nitrate Abatement Order (linked in my previous post), which required abandonment of individual septic systems to reduce the impact of nitrates on the groundwater, without imposing additional financial burdens such as forced annexation.

LAFCo, on the other hand, wanted to use the sewer connections as a “stick” to enforce annexations. Both the LAFCo Board and staff publicly stated that if the City allowed property owners to connect to sewer service without annexation, property owners would have NO OTHER REASON TO ANNEX. Not to receive local police service. Not to have drainage issues resolved. Not to have roadway upgrades completed by the City. Not to be included in the street sweeping and leaf pick-up programs. Not to vote on local issues. Did you get that last point? LAFCo believes those property owners don’t care about the ability to vote; they just care about getting that sewer connection! So much for disenfranchisement.

What else might the community not know? – Did you know that only parcels that are already developed can be connected to sewer without annexing? Any new development within a County pocket would require annexation in order to connect to sewer, which would bring in all other adjoining parcels – likely at the developer’s cost – to receive City services and infrastructure. In fact, there are a few undeveloped parcels of land in the Chapman Mulberry area that were discussed in meetings between the City, County, and LAFCo. In addition to an initiation of the annexation process at 50% plus one sewer connection, annexation would also be initiated by any new development.

Thanks for letting me spout off on this LAFCo business; I’ve needed to get it off my chest for some time now. That said, I hope it brings some additional enlightenment to those interested in, and/or potentially impacted by, the annexation debate.

If you have specific questions regarding this or any other topic we write about, please always feel free to email us if you do not want to publicly comment on the post. Odds are, if you have a question, someone else might have the same question. Letting us know gives us an opportunity to further explain anything that seems clear to us but muddy to you non-bureaucrats. Among the three of us, there is a lot of information and specific data floating around in our heads that we may not realize is important or interesting until someone asks!

So if you have a question, bring it to us! We love hearing from our readers. And, we love it when our readers share our posts with their friends, families, acquaintances, mortal enemies…whomever!

Thank you for continuing to follow us and never forget:

Truth Matters, Chico!


Into the Weeds: Revenues, Transfers, and Allocations

We’ve stepped Into the Weeds over the course of several posts now, and we’re just about ready to start looking at the larger picture and delving into some of the issues that have been in the news over the past months. We need to take a look at one more piece of the puzzle, though, and that is how money is received and moved around in and between Funds. The primary mechanisms are Revenues, Transfers, and Allocations.

Revenues are simply monies coming into the City from outside sources. They include taxes (e.g., General Fund, Gas Tax Fund), fees for service (e.g., Private Development Fund, Sewer Fund), time and materials billing (e.g., Subdivision Fund), development impact fees (e.g., Street Facility Improvement Fund, Community Parks Fund, assessments (e.g., Maintenance District Administration Fund), and grants (e.g., Capital Grants Fund, Community Development Block Grant Fund). Revenues are listed by specific types in the top section of each Fund Summary.

Here are some examples of how the Revenue section of a Fund Summary looks: General Fund, Community Development Block Grant Fund, Capital Grants Fund, and Private Development Fund. In the City budget, each Fund has its own separate page. I combined them into one document for our purpose, which was to look at how different types of Revenues are called out.

Transfers shift dollars from one Fund to another to pay for expenses. They are used, for example, when an Operating Expense is paid out of one Fund, but all or a portion of the Revenues designated to cover the expense has been paid into a different Fund. A simple example of this type of transfer is from the Parking Revenue Fund (853) to the Transportation Fund (212).

It is important to note that there are no “hidden” transfers in the budget. Both the dollar amount and the purpose of any transfers are clearly identified in the Fund Summary for both the donor and recipient Funds.

Transfers out of a Fund are labeled 9FFF, where FFF represents the recipient Fund number. Likewise, transfers into a Fund are labeled 3FFF, where FFF represents the donor Fund number.

This is how the Parking Revenue Fund (853) Summary describes the transfer: “Transportation transfer (9212) reflects the estimated cost of the Downtown Employee Free Fare Program which allows employees to ride the Transit system for free as an incentive to increase the availability of parking downtown.”

You will find a similar description in the Transportation Fund (212) Summary: “Parking Revenue Transfer (3853) reflects the estimated cost of the Downtown Employee Free Fare Program which allows employees to ride the Transit system for free as an incentive to increase the availability of parking downtown.”” 

So, the $36,000 is moved from Fund 853 to Fund 212, and then the cost of the Downtown Employee Free Fare Program is included in Transit Services payments due to Butte Regional Transit (B-Line), out of the Transit Services Department (212-653).

Allocations distribute expenses from one Fund to one or more other Funds. The largest and most complex Allocation is the Citywide Indirect Cost Allocation Plan (CAP), which will be coming forward to Council in the near future. That Allocation deserves and will receive its own separate post, once the basics of all the moving parts have been explained.

Simpler to understand are Internal Service Fund Allocations, which distribute costs for providing certain services to City Departments. Some of the Funds that receive their Revenues via Allocations are Central Garage (Fund 929), Municipal Buildings Maintenance (Fund 930), and Information Systems (Fund 935).

The basis of the Allocation depends on what services are provided. For example, the Information Systems Allocation (from Fund 935) is based on the number of computers per Fund-Department. It is allocated at the Department level, but accounted for at the Fund level. [Stay with me — I’ll explain!]

In a previous post, we discussed Planning operations, so I will use it as an example here as well. Planning’s Department code is 510, and it has operations in the General Fund (001), the Private Development Fund (862), and the Subdivision Fund (863).  In order to see Planning’s Allocation detail, you would need to look at all three of its Operating Budgets: 001-510, 862-510, and 863-510. As you can see, the Information Systems Allocation for Planning is spread across all three Funds. Please note that those are last year’s figures, since I no longer have access to internal budget pages without submitting a PRR and causing an uproar in the City Clerk’s office.  🙂

This level of detail is not available in the published budget. Instead, it contains an Operating Summary Report for Planning, which shows its total Allocations and only separates them by General Fund and Other Funds.

The important thing to remember is that Transfers and Allocations are related, in that they both effect inter-Fund cost sharing; however, the mechanisms are different. Transfers distribute dollars, and Allocations distribute expenses.

Clear as mud, I know.

Next in line for the budget posts will likely be the Private Development Fund. I had planned to move from this post directly to the Cost Allocation Plan, since it went to Finance Committee earlier this month; however, insider information has it that there was a problem with figuring out the Fund 400 piece [audible gasp!], and the study is now back at the staff level for further review rather than moving forward to the full Council. We’ll see which topic inspires me more the next time I feel compelled to wield my machete and continue blazing a trail through the weeds for you. Yee haw…

Thank you for your continued readership. We welcome your comments and questions, and ask that you please continue to share our posts with your family, friends, and neighbors.

Remember: Truth Matters, Chico!


Photo credit:

Remedial Funding

It looks like Public Works Director Ruben Martinez is playing pin the tail on the fund list to choose funding sources again. We think he should remove his blindfold and try reading the Fund Summaries for allowed uses, but that is just our opinion. Maybe he needs a remedial budgeting class. We can only speculate about how he is coming up with the funds he has been proposing.

One thing is for sure; whatever method Martinez is using, it’s not working for him, or the taxpayers. Municipal finance rules are there for a reason, and it is clear he does not understand them.

We have already described to you his lack of knowledge of Fund 400 (Capital Projects), as well as his inappropriate use of Fund 850 (Sewer). At the November 19 City Council meeting, I will be pointing out yet another misuse of City funds by Martinez. The fund being negatively impacted this time is Fund 312, the Remediation Fund.

A few days ago, we shared the agenda for this City Council meeting. Item 2.2 of the Consent Agenda is a request for a supplemental appropriation to allocate $25,000 from Fund 312 to remediate a mold problem at Fire Station No. 5. The City is looking into whether or not its insurance policy will cover the cost of the project; but even if it is covered, the $25,000 request is still proposed to pay the City’s current insurance deductible.

(As an aside, our resident insurance expert, Mary, says there is no way this is a covered loss. Mold is a maintenance problem, specifically excluded in standard property insurance policies. She also asks a couple of thought-provoking questions: If the total cost of the project is $25,000, why are they even checking with the insurance company? On the other hand, if the project cost exceeds $25,000, why are they only asking for $25,000 to remediate the problem? If you are interested, you can read more about mold remediation and insurance here.)

I mentioned above that Fund 312 is the Remediation Fund. Does that mean it pays for any and all remediation projects? Nope. It was created to pay for groundwater remediation, primarily at the Chico Municipal Airport.

There is some important history regarding this Fund. (I am about to get highly technical here; please bear with me. I will try to limit it to a paragraph or two!)

Back in the early 1990s, the State of California Department of Toxic Substances Control (DTSC), sued the City of Chico, and more than 15 others who owned properties in the vicinity of Chico Municipal Airport, for groundwater contamination. Previous military and industrial activities that occurred sometime between the 1940s and 1980s resulted in the release of hydrocarbons and volatile organic compounds (VOCs) into the soil, therefore contaminating the groundwater. The primary VOC identified as a concern was trichloroethylene, most commonly referred to as TCE. In case you are interested, TCE is a chlorinated hydrocarbon commonly used as an industrial solvent. (In laymans terms, it was a great degreaser!)

Neither the City of Chico nor most of the property owners included in the lawsuit were directly involved in the release of TCE into the groundwater; however, as they are now the owners of the property where the problem exists, they were named as responsible parties. I am going to skip discussing the many steps of the lawsuit to get to the important part – a Consent Decree was placed on the properties, requiring groundwater remediation, and a Settlement Agreement was established to pay for the expected remediation. All of the parties listed in the lawsuit had to pay into the Settlement Agreement, and because the City of Chico was the local municipality and owner of the Airport, the City was listed as the Responsible Party for the cleanup and was given the Settlement Agreement monies to cover necessary work.

Fund 312 was created using the monies from the Settlement Agreement. While other monies have since been transferred into Fund 312 from Fund 850 (Sewer) to pay for groundwater remediation projects at other locations, the remainder of the money is clearly dedicated to remediation of the properties identified in the Consent Decree whose owners paid into the Settlement Agreement.

The Fund Summary for Fund 312 describes many of these important details; it specifically states that the use of the Fund is restricted, and it states that the authorized uses for this Fund include only capital and operating expenditures related to groundwater remediation. The Fund Summary concludes that “The City contemplates that Chico Municipal Airport remediation will continue for decades, therefore, use of these funds is committed to this purpose.” Can it be more clear?

Also important to note is the sentence directly before what I have quoted above: “…liability of all other parties is limited to monies already provided in the settlement.” To be clear, if the monies in Fund 312 run out, the City will have to find alternative funding sources until the remediation is complete – a decision that DTSC will make. The Consent Decree was issued by a U.S. District Court and is legally binding.  If Fund 312 is depleted, the City cannot just say, “Oops, guess that project is done.”

Let’s go back to Martinez’s funding request for mold remediation at Fire Station No. 5. He is asking the Council to allocate $25,000 from Fund 312. Mold remediation is not an allowed use of Fund 312. Period.

It is curious that the Municipal Buildings Maintenance Fund isn’t being charged for this project. If staff and Council do not want to charge the Municipal Buildings Maintenance Fund, at the very least, would this not be a cost of the Fire Department (100% General Fund)? After all, it is a Fire Station being impacted.

One thing is for sure, use of Fund 312 to pay for mold abatement at a Fire Station is inappropriate. If this funding request is approved without changing the proposed source, it will be just one more indication that this Executive Team and Council cannot be entrusted to make the right decisions regarding our City.

Thank you for your continued readership. As always, your questions and comments are welcome.

Remember: Truth Matters, Chico!


Into the Weeds: Operating and Capital Budgets

In the most recent Into the Weeds post, I provided an analogy to help you understand the difference between Funds and Departments in municipal accounting. That concept will be important now, as we discuss the differences between Operating and Capital budgets; and even more so once we begin discussing Revenues, Allocations, and Transfers. As a reminder, I am keeping permanent links to all of the Into the Weeds series on a separate page, so you can easily go back and reread old posts when necessary.

Operating Budgets are developed and accounted for at the Department level. They are designed to pay for the anticipated costs associated with conducting a Department’s routine business. These budgets are similar to your household budget, in that you have a pretty good idea what your annual expenses will be, based both on past experience and expectations for the coming year.

The City separates its Operating Budgets into several Categories (Salaries & Benefits, Materials & Supplies, Other Expenses, etc.), which are then separated into Line Items (Salaries – Overtime, Office Expense, Training, etc.). Here is an example of what an Operating Budget looks like:  Sample Operating Budget

Some Departments have Operating Budgets in more than one Fund. A good example of this would be the Community Development Department (CDD). Because CDD conducts some of its business on private projects for which a fee is charged, those costs are budgeted in the Private Development Fund (Fund 862).  CDD also conducts some operations on a time-and-materials basis, primarily large developer projects such as subdivisions or development agreements; those operating costs are budgeted in the Subdivision Fund (Fund 863). Most of the City’s residual Housing operations are grant funded, so CDD has a budget in the Community Development Block Grant Fund (Fund 201). Finally, some CDD operations are conducted in a General Fund (Fund 001) budget, specifically non-project related activities that benefit the community as a whole, generally at the direction of Council or mandated by another agency.

When you look at the published City budget, you will not see the Line Item detail provided above. Instead, you will see an Operating Summary Report, which totals up all of the Department’s Operating Budgets by Category and then breaks them out by Fund totals.

While I would like to show you what Community Development’s Operating Summary Report looks like, this fiscal year’s budget ignored the new organizational structure altogether. So instead, I will show you what the Planning Division’s Operating Summary Report looks like, since it includes three of the four Funds mentioned above.

Planning Operating Summary Report

The top section shows Category totals for the entire Department, across all Funds in which it operates. The bottom section shows Fund totals, without any detail. (What you originally saw is an internal budget page. It includes Line Item details for all Department expenses, with separate budget pages for each Fund in which it operates.)

Capital Budgets are created to fund special projects rather than ongoing operations. There is generally a beginning and ending to a project, defined by creation of a specific, tangible asset.

Most Capital Budgets fund one-time infrastructure improvements (such as the Water Pollution Control Plant Expansion), although they are also sometimes used to fund consultant studies (such as the General Plan Update), if the cost exceeds $20,000 and/or multiple Funds are being used to pay for them. Expenses frequently cross fiscal years, so the City budget looks 10 years out to capture the entirety of the project.

Although some projects do have a fixed annual Capital Budget, work generally occurs at different locations each year. A good example of a project like this is the Annual Pedestrian Improvements. A fixed amount of money is budgeted for citywide improvements, and work is prioritized based on need.

Unlike Operating Budgets, City Capital Budgets are developed and accounted for at the Fund level. While each project is assigned to a certain Department for management purposes, all staff work on the project is charged to one budget account number without regard for departmental lines. Also, whereas Operating Budgets are developed using annual expense Categories (Salaries & Benefits, Materials & Supplies, Other Expenses, etc.), Capital Budgets are developed based solely on the total cost of the project.

Separation of project costs in a Capital Budget occurs after the expenses are incurred and is based solely on Activity Codes. In other words, staff salaries and postage and consultant costs and construction materials and contractor payments are all lumped together, separated only by whether the expenses were related to Property Acquisition, Project Design, Environmental Review, Construction, Inspection, etc. This is a critical concept that will tie into our future discussion of how the Capital Projects Fund (Fund 400) works.

In the City’s published budget, there are a couple of ways to look at Capital Budgets, but the simplest way is the Capital Improvement Program detail pages. Since Quené recently corrected some of the Public Works Director’s funding misstatements about the West Trunk Line Improvements project, and its funding and activities are clean and simple, we’ll just use that as our example.

Here is the detail page for the project: 16016_West Trunk Line Improvements

Notice the heading in the upper left corner – it assigns this project to Building & Development Services (which no longer exists). As I mentioned above, that assignment is for project management only. The Actuals column includes cumulative costs incurred, from project inception through the previous fiscal year, regardless of what Department incurred them.

Below the heading, the far left column shows Activity Codes 4110 (Preliminary Design / Study) and 4140 (Design) with expenses that have already been incurred. Beneath those, you will find Activity Code 4998 (Project Budget) with all projected costs for the current and future fiscal years. The final Activity Code, 4999 (Overhead), includes actual costs incurred as well as a budget in the out years, estimated at 15% of project costs. (Budgeted overhead rates vary from project to project, depending on a variety of factors. This particular project qualifies for a 15% rate.)

The second column indicates that the project is paid for solely by Fund 320 dollars, which is why you only see each Activity Code once. If there were two funding sources, you would see each Activity Code twice – once for Fund 320 and again for the second Fund.

Just so you can see what a more complicated project looks like, here is the project detail page for the SR 99 / Eaton Road Interchange project. The only thing I need you to see is that some of the Activity Codes are repeated for different Funds. This is what I meant when I wrote that Capital Budgets are developed and accounted for at the Fund level.

So, that’s plenty for one day. If you have questions about anything I’ve covered, please, please let me know. As we move forward with this series of posts, it is important that you grasp the concepts. I don’t want to lose you in the weeds!

Next up will be a discussion of Revenues, Allocations, and Transfers. Once we get through that, we can start looking at some of the issues currently being thrown around as political hot potatoes. That’s when the REAL fun begins. Whee…

Thank you for your continued readership. There are serious matters moving through the City bureaucracy, and it won’t be long before they come forward to the Council. Every Chico citizen and taxpayer should be concerned, so please continue to share our posts with your family, friends, and neighbors.

Remember: Truth Matters, Chico!

More Monkey Business with Admin Layoffs

Well, we called this move. In our October 1 tag-team presentation to Council during Business from the Floor, Alicia, Quené, and I closed with these words:

While it is clear that none of this will undo the wrongs that have been done, perhaps bringing it into the light will prevent similar bad acts from occurring during the impending layoffs. And we certainly hope we do not see elimination of the additional Admin Assistant positions created to protect the new HR Analyst. That would be the Executive Team’s ultimate backhand to the rules set forth in the Municipal Code. As Councilmember Stone would say, “Disgusting.”

Sure enough, the following day, the new layoff seniority list was published. And what did it include? Elimination of one of the two brand new Admin Assistant positions created in July to protect the least senior member of the citywide admin staff. The net result is that yet another senior admin staff member will take a double hit, from Admin Analyst I to Admin Assistant to Police Records Technician II, complete with a second pay cut. The protected employee is now two full classifications higher than her.

Here is an old chart showing the various positions within the Administrative Career ladder (we do not have the new one, if it even exists) so you can follow along: Admin Career Ladder

We suppose the next logical move will be to reclassify the remaining ‘extra’ Admin Assistant position to Office Assistant, to get back to a zero sum game. But stand by, there’s more…

Also notable among the current admin layoffs is the elimination of the two remaining Office Assistant III positions. The more senior of these two employees will be transferred from Engineering and demoted to an existing .74 FTE Office Assistant II position in Fire; this will reduce both her pay and her hours.

(As an aside, the current occupant of the position in Fire was just bumped in July from Admin Assistant in Planning, down two full classifications to Office Assistant II, with a double pay cut and a bonus 26% reduction in hours. She will be bumped all the way out the door during this round. Nice…)

The less senior Office Assistant III currently serves as receptionist and clerical support for the City Manager and City Clerk. In fact, after the July layoffs, she is the only general clerical employee on the entire 3rd floor. The new layoff seniority list demotes her to Office Assistant II and reduces her from full-time to half-time, resulting in a reduction of both pay and hours, but leaving her in her current job.

Now, we know and like all of these women, so our opinions about the position shifts are not intended to be personal. We are, however, going to go out on a limb and make a call as to what will come next with that 3rd floor position.

This gets a bit convoluted, so please bear with us. If you are trying to wrap your head around the not-really-very-fun games that are being played internally, this is important stuff.

Here’s the first question: Do any of you believe that a single half-time, low-level clerical employee can provide sufficient support for both the City Manager and City Clerk offices? Something is beginning to smell…

Because we are former employees, we know where to look for information that might appear meaningless to anyone on the outside. We requested and received the current year’s Personnel Allocation Worksheets (PAWs), which are documents used to prepare the budget. These documents do not reflect current staffing; rather, they anticipate staffing as it will exist at some point during the fiscal year.

There is no Office Assistant position whatsoever in either the City Manager or City Clerk PAWs. Instead, there is a brand new job classification of “Executive CSA” that we think probably means Customer Service Assistant or something of that nature. The Executive CSA is budgeted 50% each to City Manager/City Clerk, as is the current position; however, the budgeted salary is 5% higher than the top pay for the Office Assistant III classification. The smell is getting worse…

So you might be asking yourself at this point, why demote the only 3rd floor general clerical employee and cut her hours by half? The answer lies in the personnel reduction rules set forth in Chico Municipal Code Section 2R.72.

Had the 3rd floor Office Assistant III position been left intact, the more senior of the two employees would have had bumping rights to it [a position she previously held for many years], and the less senior employee would have been bumped out to Fire. Of course, that would be unacceptable in this new era of personalities before positions, so the 3rd floor position had to be adjusted, at least temporarily, to be less desirable than the position in Fire. That would be the only way to achieve the desired effect of keeping the less senior employee on the 3rd floor. Have you caught a whiff of it yet?

After the July layoffs were completed, we watched in dumbstruck awe as the least senior admin employee in the entire City, who had been protected from layoff by creation of additional Admin Assistant positions, got promoted without notice or an opportunity for others to compete. As we mentioned in our earlier post, this move put her in a higher classification than other qualified employees with far more seniority.

Our guess is we will see that happen again, once this round of layoffs is complete. We bet five bucks the 3rd floor position will be restored to full-time and reclassified to the new “Executive CSA” position, from which the incumbent cannot be bumped. That would really stink.

More of the new efforts at transparency and morale building….


Photo credit:

No Grievance, No Problem?

At the October 1 Council meeting, after my colleagues and I raised the issue of improprieties that occurred during the first round of layoffs, Mayor Gruendl engaged the City’s Executive Team to hear ‘their side’ of the story. The City Attorney stated that no grievances had been filed by the CEA administrative staff during the initial layoff process  (note CEA is only one union group of the nine existing within the City); in response to which the Mayor implied if no grievance or labor practice complaint was filed, then there must have been no issue with the layoff procedures.

The idea of measuring the ‘correctness’ of layoff procedures by whether or not grievances were filed is absurd.

As laid out in our recap of the administrative layoffs (linked above), City employees were witnessing the new Executive Team targeting specific individuals by laying aside adopted personnel rules to enact favoritism. While some employees were rewarded with promotions and raises for demonstrating a ‘yes-man’ personality and not questioning management’s actions, most employees were experiencing a very different, extremely uncomfortable, environment. In this more common and negative environment, we wonder, what employee who needed his or her job would be willing to stir the pot by individually filing a grievance, an act equivalent to placing a target on their chest? It had become all too clear that those not willing to keep their heads down and mouths shut would find themselves in danger of being demoted, or even more devastating to their personal and family welfare, terminated from employment.

In light of the new round of layoff notices delivered last week, employees who have been impacted by improper layoff procedures may want to consider whether filing a grievance is now in their best interest. If we are to believe the Mayor, filing a grievance or labor practice complaint may be the only way the Executive Team will be held accountable.

Section 2.72 of the Municipal Code requires Council adoption of personnel rules, and states in part, “High morale shall be maintained by fair administration of this chapter and by every consideration of the rights and interests of employees consistent with the best interests of the public and the city.” Your Union Steward can provide you with additional information on the grievance process.

These back-room deals on layoffs, reclassifications, and promotions should cause concern to every Chico citizen. The Executive Team’s willingness to come up with a ‘legal’ work-around that violates the spirit of the Municipal Code and Administrative Policies and Procedures should send up a large red flag. This time, the victims were employees, but what could be next? Possibly a loophole to obtain a tax increase by calling it something else . . . perhaps a solid waste franchise fee levied on citizens via their garbage service bills?

Only time will tell. Remember, just because the government has the right to do something, does not make it the right thing to do.

A Tale of Two Opinions

In case you missed Alicia’s post yesterday, let me repeat her opening statement:  “The City of Chico is in a financial mess; there’s no arguing with that. In fact, cast my vote among those who say that it’s been a mess for quite some time.”

Our gripe is not with the spending cuts; rather, it is with the continuing stream of inaccurate information being put forth in public meetings and the media, and the shady methods with which the cuts are being made. We know the City has been overspending for years and believe the cuts should have been made long before Nakamura swept into town; however, City staff works at the direction of the Council, and for the Council to assert that staff was making choices without the Council’s knowledge and support is disingenuous at best and downright deceitful at worst.

This morning, an editorial appeared in the Chico Enterprise Record entitled “An unfortunate sign of the times” which opines in part:

“As the bad news keeps piling on and more people lose their jobs at an outsized city hall, which should have started taking corrective actions years ago, the mood continues to sour. Former employees and others in the community who don’t like this sudden rush of fiscal oversight have stirred some hostile feelings.

Vulgar, racist emails have been flying around that are directed at City Manager Brian Nakamura, his top department heads and city councilors. Nakamura also has been accosted in public and his car has been vandalized. “

We are more than tired of our particular criticisms of this administration being tied to overt acts by others. There is example after example of citizen outrage directed toward Nakamura dating back to January, including public outcry over former Assistant City Manager Rucker’s “abrupt retirement,” with neither a thank-you-very-much nor a fare-thee-well from the Council after 24 years of dedicated and honorable service to the community; ongoing development community and staff anger over the “mysterious resignation” of former Building & Development Services Director McKinley; open criticism of the shameful salary increases approved for the City’s Executive Team and new Assistant City Manager while layoffs of worker bees were being proposed; angry citizen and police and fire staff commentary regarding the proposed cuts to safety; the community’s outspoken criticism of the Farmers Market debacle; the community’s equally outspoken criticism and downright disgust related to Caper Acres; the social activists’ and homeless population’s open protests regarding the Sit/Lie Ordinance; and the political right’s vocal opposition to the Plastic Bag Ban Ordinance. And that list is not all-inclusive.

Nakamura’s administration has generated more anger and distrust across the entire spectrum of citizen groups than we have ever seen, and for that we cannot claim credit. We never said a word until August 6. So, enough already, okay?

But I digress.

I would direct your attention to a second Chico Enterprise-Record editorial from March 10, 2013 entitled “Salary setting, swift hiring, raise suspicion.” I wrote a post detailing this particular incident two days ago, but after this morning’s editorial, it seems appropriate to revisit it.

The final paragraphs of the March 10 editorial read:

“Government wants the best, not the best the taxpayers can afford.

The department head salary ceiling was particularly galling when Finance Director Virginia [sic] Hennesy began giving her budget update. Again and again through her report, she mentioned her numbers were based on the assumption that 11 vacant police positions would not be filled.


If the department head number was $130,000, could we get that down to 10 police vacancies? We’ll never know, as the council approved the proposal.

The assistant city manager’s salary was put at $185,000 in the same vote. John Rucker, who held the post until he abruptly “retired” in January, made $158,461. Again, a pretty hefty raise, but defensible if department heads are making $160,000.

And what happened next really rubs us the wrong way. The council approved the $185,000 figure Tuesday night. By 11 a.m. next morning, the Riverside Press Enterprise was reporting Nakamura’s former No. 2 in Hemet — Mark Orme — had quit to take the same position in Chico.

And his salary in Hemet? $180,000, suspiciously close to the $185,000 cap the Council had set just a few hours before.

Nakamura claims he didn’t decide on Orme or offer him the job until Wednesday morning, but the speed with which it happened makes us skeptical. It sure looks like a salary schedule was foisted on the council — and the taxpayers — that would allow Nakamura to bring his old buddy on board.

But that kind of stuff doesn’t happen, right?

We hope Orme is thick-skinned. And we hope he’s good at his job, because Nakamura’s going to need help overcoming the damage he’s done to the community’s trust in him.

Who, exactly, was responsible for those critical comments? And, again, that editorial was published in March — five months before we ever said a word. Now, when we are pointing out the same and similar deceptions, we are somehow held responsible for racist emails, threats, and vandalism?

Mayor Gruendl recently told Alicia after her comments during business from the floor that the Council is accountable for its words and actions during public meetings, and we intend to hold him to that. We accept responsibility for every word we have spoken or written, and we will hold city administrators and the press accountable for theirs, as well.

Meanwhile, we are hearing that things are getting more and more unpleasant inside City Hall. Current employees, who are still unable to speak freely about the ongoing shenanigans for fear of swift and merciless retaliation, are once again expressing their concerns and frustrations with this administration’s methods via indirect outlets. The Mayor’s all-out assault on us as former employees proves their fear legitimate.

This photo was taken in the lobby of City Hall a few days ago. GSD staff is primarily comprised of laborers — some of the lowest paid folks who do the hardest work — park cleaning and upkeep, street and sewer repair, vehicle maintenance, etc.

Drinking Fountain Signs

Rumor has it the Assistant City Manager is leading an investigation into which naughty employee is responsible for that bit of free speech, and that management considers this a fire-able offense. We think the taxpayer dollars funding Mr. Orme’s salary could be better spent in pursuits other than investigating harmless signs (and, for any of you present at the most recent Council meeting, watering plants?).

We encourage you to become involved in your community’s government and make your voices heard. Attend Council meetings and express your opinions, write or email your Councilors, write letters to the editors of the Enterprise-Record and the Chico News & Review. Act now, because until the Council members hear from enough of us to cause sufficient concern about their re-election, they will continue to barrel along with their agenda, with or without the community’s support. The Councilors work for US, the citizens and taxpayers. It is time to give them some marching orders.

As always, we thank you for your continued readership and welcome any comments or questions.

Remember: Truth Matters, Chico!

%d bloggers like this: