Category: Watch Your Wallet

Posted onFullerton 2010

Aaron Gregg Wriggles Out From Under His Taxes with a Quick Bankruptcy

by 28 Comments on Aaron Gregg Wriggles Out From Under His Taxes with a Quick Bankruptcy

When you put your name on the ballot, you’re asking voters to trust you with hundred million dollar budgets and the power of a government office. Therefore, it is a duty of the public to make sure that each candidate is qualified to handle this burden of responsibility. Anybody with a financial history that cannot stand up to basic scrutiny should not put themselves out in front of the voters.

On that note, Aaron Gregg should not be running for Fullerton City Council.

Okay, creditors to the back of the line!

You see, attorney Aaron Charles Gregg filed for a $107,000 bankruptcy about 10 years ago, discharging over $75,000 in federal and state back taxes and $30,000 in other debts to individuals and businesses, all while claiming $8,000 a month in income from his business.

View the bankruptcy filing

It’s all laid bare in these papers that were filed in federal bankruptcy court, which show that Aaron Gregg neglected to pay his taxes for most of the years from 1992 through 1998. When the debt piled up, he hired an attorney and let it all go.

Among the more curious items in the filings, Aaron Gregg listed assets of $25 dollars cash, $200 in clothes, $75 wrist watch and some office supplies. Times must have been tough for this professional attorney of 21 years. Fortunes were about to change, however, when he realized that he would be able to dump his debt but keep his leased $5,000 Savin copier. I bet that will come in handy some day.

I'll need that when I run for city council.

The documents also show that halfway through the bankruptcy process, Aaron Gregg discovered that he might also owe money to a family in San Pablo City, Philippines. What could that be for? Well they’re never going to vote in Fullerton. Might as well get rid of that debt too.

It was a bad investment.

In the end, it looks like Aaron was able to dump over $100,000 owed to nine different creditors, two of which were government agencies. When the tax man doesn’t get his revenue, guess who gets to make up for it? That’s right, you and me. And somehow I have a feeling that Aaron Charles Gregg made it out of this financial mess and has been doing just fine ever since. But that’s no reason for him to think he’s a valid candidate to run our city.

On second thought, Aaron’s keen ability to get himself out of unwieldy financial commitments may come in handy when it’s time for Fullerton to escape our massive redevelopment and pension debts. But it’s probably safer to just call him in as a consultant.

0
Read More
Posted onWatch Your Wallet

Volunteer Firefighters Account for 1/3 of OC Fire Authority’s First Responders – Fullerton ZERO

by 21 Comments on Volunteer Firefighters Account for 1/3 of OC Fire Authority’s First Responders – Fullerton ZERO

The front page of the September 9, 2010 Orange County Register brings to light how a good idea is implemented poorly.

The article discusses a report from an un-named source that shares data on response times from reserve firefighting and medical units in Orange County. According to the article, there are 495 reserve positions with only 291 positions filled. Of the 291 positions, 41 will be laid off or fired.

Let’s put it in perspective. The Orange County Fire Authority employs 841 full-time firefighters/fire management personnel. They have budgeted 495 reserves for FY2009-10. That means that nearly 1/3 of total first responder capabilities rest in the hands of reserves. Fullerton has no reserve firefighters to help shore up minimum staffing requirements and minimize overtime. For a department which was founded as a volunteer fire department I find it ironic that they now have zero reserves on hand to help.

The OC Register article goes into the asset versus liability of having reserve fire units. Essentially, the report finds that several reserve units failed to respond to calls. That in and of itself is problematic but the real question that is missed is where has management been? You would think that management would notice pretty quickly that the reserves are not responding and then take corrective action. Apparently no one noticed.

Amazingly, the solution is quite simple. By integrating reserves with professionals in the same manner as law enforcement agencies, the reserve can be better managed and will have the opportunity to receive peer mentoring.

Why has management allowed reserves to have their own volunteer units and not an integrated approach? My guess is that the OCFA union would not allow it through their MOU or no one cared enough to explore the use and utility of having reserves. For that matter, why do we still have firefighters being paid to sleep in regional firehouses? No other public agency outside of fire service, would allow employees to sleep on the job.

I realize the thought of working an 8- or 12-hour shift might terrorize some firefighters but it would certainly make better sense than having dozens of high-paid public servants sleeping on the job. Other communities have already implemented 8-hour shifts. It would also address the argument that firefighters deserve their high pay and pension because they are away from their family more than other public employees. With that argument one would think our soldiers are millionaires considering the time they spend away from their families.

Firefighting has its own culture based largely on tradition. When those traditions negatively affect taxpayers, it is time to think if we want to continue down this costly “traditional” road or cut a brave new path that leads to improved services and lower costs.

Read More
Posted onFullerton City Council

What’s Another $30 Million? Charge It.

by 14 Comments on What’s Another $30 Million? Charge It.

What happens when you run up a credit card but only make the minimum payment? It never works out very well. But that’s how Fullerton is handling $30,000,000 in retiree health care commitments.

http://www.youtube.com/watch?v=ntIaUiv9seU

Jack Dean passed along this unfortunate piece from the OC Register which exposes over $1 billion in unfunded retiree health commitments for Orange County and its cities. Fullerton’s spending problem is summarized here:

City Fullerton
Population 138,610
Unfunded costs $29,986,735
Unfunded cost per capita $216
Maximum benefit (per year) $9,744
Paid in 2009 $1,927,528
Does the agency pay only the minimum cost? Yes
Is a lifetime benefit offered? Fire employees
Source: Retiree health costs and other retiree data from local cities and the county; population statistics from the California Department of Finance

Retiree health benefits are negotiated between our city council and the public employee unions during contract renewals. Supervisor John Moorlach says they are an easy squeeze for unions because boosting benefits for employees requires no up-front cost to the city.

Much like exorbitant pensions, these benefits are a long-term commitment where the future costs are impossible to calculate at the time the entitlements are given. Ultimately, taxpayers are responsible if costs “unexpectedly” spiral out of control. And of course, they always do.

Read More
Posted onHarry Sidhu

Harry and The Dems; or #2 Goes To The Zoo

by 24 Comments on Harry and The Dems; or #2 Goes To The Zoo
Donkey love...

Now that only the worst repugs still support his torpedoed campaign for 4th District supervisor (a district in which he doesn’t live), Hide and Seek Harry Sidhu seems to have decided that chumming it up with Democrats is his only prayer. Seems he even went so far as to attended the big Democrat Labor Day bash at the Santa Ana Zoo.

While Harry Sidhu was at Zoo, whooping it up for California’s #1 union stooge Jerry Brown, as reported by the Orange Juice blog here, he also happened to run across Pam Keller. Poor Harry selling his soul again just to get elected. Jeeze, this guy would do just about anything to be a political somebody. Will he re-register as a Democrat? Why not?

Well I hate to pop your bubble, Hide and Seek, but people can see right through your transparent BS, fake residences and all. All they can see is Sidhu the assclown.

That cologne is a real chick magnet.
Read More
Posted onUnion Goons

Fullerton’s Real Unfunded Pension Liability: At Least $60 Million

by 28 Comments on Fullerton’s Real Unfunded Pension Liability: At Least $60 Million

Last year CalPERS reported that the city of Fullerton is facing an unfunded pension liability of $37,531,831 on our public safety employees’ retirement plan. That’s the amount that we currently owe our public servants above and beyond all future budgeted payments.


Of course, many professional actuarials believe that CalPERS’  figures are purposefully understated. They’re just being nice. What we’ve learned over the last few years is that CalPERS and the unions have been feeding our politicians a big fat load of lies, which were used to pump up their pensions. The figures are derived from proven unrealistic investment returns that can never be achieved. Studies conducted by Stanford grads and the NCPA agree.

So we asked an industry insider to recalculate Fullerton’s unfunded pension liability using a realistic rate of return for a government pension system. While he could not do a detailed actuarial report for our city, he stated that using a more realistic 5% long-term rate of return “would raise the unfunded liability by somewhere between 60% to 120% in most pension systems.”

Based on those figures, it’s safe to say that Fullerton’s real unfunded pension liability is somewhere between $60,000,000 and $83,000,000. That’s just for the police and fire unions, which has about 250 currently employed members.

Wrap your head around that. Sixty million dollars of unfunded, unplanned debt just for our little city of Fullerton. That money will not be spent on roads, parks, infrastructure, libraries or public safety. It will be given away to retired public employees, long after they’ve stopped serving our city.

If we don’t do something about it now, it’s going to get worse.

Read More
Posted onFullerton 2010

Dissecting McKinley’s Phony Pension Reform

by 12 Comments on Dissecting McKinley’s Phony Pension Reform

The other day we challenged retired police chief and $215,000 public pensioner Pat McKinley to put some real meat behind his dubious claim that he will “work to reform public employee pensions.”

Over the weekend we discovered a letter posted to McKinley’s website purporting to declare his position on pension reform. Exciting… until we read it. The letter actually commits to nothing and woefully understates the changes necessary to even begin correcting this problem.

Just say anything

Let’s run through Pat’s suggestions one by one. It’s important to note that McKinley’s letter says pension reform must contain ONLY ONE of the following:

Increase the amount contributed to the plan by Employee Contributions – Necessary, but wholly insufficient. While giving taxpayers some breathing room, demanding employees pay a little bit more does nothing to address the core issue, which is the unsustainable nature of pension guarantees when combined with the power of public employee union lobby. By itself, this change only slightly delays the pain.

Increase the amount contributed to the plan by Employer Contributions – Unbelievable. Increasing employer contributions is another way of saying we should raising taxes to pay for pensions. So now it would be safe to say that Pat McKinley wants to raise your taxes, but it’s really hard to believe he would write anything this dumb. For now, we’ll just assume that he has no idea what  he’s talking about.

Slow the accrual of pension benefits by returning the formula to its previous level – Legally a change like this change can only be made for new employees, which would do nothing to address the massive unfunded liability that we have already accrued. Furthermore, it leaves the door wide open for future abuse when the unions become more powerful.

Slow the accrual of pension benefits by increasing the normal retirement age to reflect the longer life expectancies of our City employees – Same problem as above. The commitments we’ve made to current employees cannot be changed without a bankruptcy. The only lever we really have left salary and to a lesser extent, contributions. Cut salaries, raise employee contributions… or go broke.

Slow the payout of retirement benefits by lowering the Cost of Living Adjustment in retirement – The cost of living adjustment is about 2% a year. Reducing that, if it’s even legal in California, is hardly enough to sustain hundreds of public safety employee’s earning 90% of their final year’s pay for the next 30 years. And once again, there’s nothing to prevent another band of RINO’s from reinstating this benefit the next time CalPERS overstates its assets.

So what have we learned? McKinley has thrown out a bunch of half baked ideas to fool you into thinking that he wants pension reform, but it really boils down to almost nothing useful. And of course, even after writing this letter, McKinley has not committed to any pension reform.

Woefully inadequate

We’ll say it again: Taxpayer-funded defined benefit plans must come to an end. The private sector learned long ago that they are completely unsustainable and also unnecessary. All new employees should be given defined contribution plans, while current employees should be made to pay as much as possible towards their own retirement, in order to mitigate the damage caused by their own unions and CalPERS through deception and poor planning.

Read More
Posted onBehind Closed Doors

A Colorfully Gesticulating Norby Loses The Skirmish, But Wins The Battle

by 3 Comments on A Colorfully Gesticulating Norby Loses The Skirmish, But Wins The Battle

Who will win the war? Follow the money.

The GOP Initiatives Endorsement Committee met this past Saturday to debate whether it should recommend to the State GOP to endorse Proposition 22.

Watch and see what happened during the questions and answer period. The proponents for Yes on 22 focused their argument on misdirected “local control,” and the fear that if it doesn’t pass Arnold Schwarzenegger will raid the cities’ Redevelopment funds and give them away to the schools. Hooray! The only problem is that by the time this is voted on Arnold will about as lame a duck as Daffy, and probably already reading the script for Terminator 5.

Did the most vocal Yes on 22 proponent, Jon Fleischman (hot dog alert @ 3:18), really think the voting members  in the room would be dumb enough to buy that “Arnold will cook up a bad budget” line? Well, they did – the vote was 9 Ayes and 8 Noes.  However, good news came on Sunday when the recommendation of the Initiatives Committee was tossed out by the GOP party who gave a thumbs down to the Prop 22 proponents.

Check out Chuck Devore, one of the few non-repuglicans in office. He gets it.

And yes, I really do have to wonder if Fleischman was on the Yes on 22 payroll. The Howard Jarvis group was no doubt bought off by the purchase of a slate mailer.

Read More
Posted onRedevelopment

California GOP Initiatives Endorsement Committee Hashes Out Prop 22

by 6 Comments on California GOP Initiatives Endorsement Committee Hashes Out Prop 22

Proposition 22 here, is an initiative supported by the California League of Cities and Redevelopment agencies and their lobbyists.

Voting yes on 22 would prohibit the State from restricting the use of tax revenues dedicated by law to fund local government services, community redevelopment projects, or transportation projects and services. It would prohibit the State from delaying the distribution of tax revenues for these purposes even when the Governor deems it necessary due to a severe state fiscal hardship.

The question boils down to whether the State should have the authority to redistribute redevelopment property tax increment funds and use it for schools, and fire departments.

The clip below was taken at the GOP  state convention held this past weekend in San Diego and features the Yes on 22 proponents debating State Assemblyman Chris Norby at the Endorsement Committee meeting. Each party was given 3 minutes to make their pitch, the Yes on 22 proponents spoke for 3-1/2 minutes, however when Assemblyman Norby was only 2-1/2 minutes into his speech (6:58) one of the 22 proponents rudely interrupted Norby and yelled “TIME” even though Norby still had 30 seconds left of his 3 minutes.

My next post will feature video footage of questions and answers by both Norby (No on 22) and the Yes on 22 proponents. There’s also a little treat at the very end of the clip, enjoy!

Read More
Posted onOC's Fourth District

16 Minutes of Pure Agony

by 32 Comments on 16 Minutes of Pure Agony

Enjoy these two clips that feature an exchange between County Supervisors Shawn Nelson and Janet Nguyen. The issue is pulling the plug on the moribund Civic Center Joint Powers Authority, an agency that was created when Lyndon Johnson was president, and that has served no legal or practical function for almost ten years.

You would think that supposed “conservatives” would pile on to the opportunity of killing a government entity, especially one that doesn’t do anything. Well, you would have to think again. Just listen to the drivel that escapes the Board Chair’s lips and dribbles down her chin. Ay, ay, ay!

Read More