A coffee run with Costa Mesa councilmen — in Newport Beach
Costa Mesa, twice in one week.
Yes, I headed back to the battle zone. Back to the city an Orange County GOP official called “ground zero” in the war on public employees, or at least on their pay and pensions.
Why? Because after my column last Sunday, I got an invitation from City Councilman Jim Righeimer, who didn’t come off so well in it. I quoted Costa Mesans who think that when Righeimer and his cohorts sent out layoff notices to half the city’s employees, it was more about political jihad than about dollars and cents.
Not so, Righeimer insisted, and I thought it was only fair to hear him out.
I suggested we invite some employee reps to the party, so I could play referee. Righeimer declined but wanted to bring along his buddy, Councilman Stephen Mensinger. To hold his hand, I guess.
At Righeimer’s suggestion we met at Kean coffee house, but guess what. It’s not in Costa Mesa, it’s in Newport Beach.
“That’s Costa Mesa across the street,” Righeimer said defensively.
I was reminded of the time Antonio Villaraigosa was running for mayor of Los Angeles and asked me to meet him for dinner in Beverly Hills.
But I digress.
Righeimer and Mensinger argued that as longtime real estate guys, they brought their businessmen’s perspective with them to City Hall after taking office in recent months. And it was instantly clear to them that something had to be done about personnel costs.
I love it when private-sector guys think they can fix any government agency without breaking a sweat. Didn’t their real estate industry just crash? And if the private sector is so clean and efficient, why does the business section of every newspaper look like the crime report?
On the other hand, one reason I agreed to meet with Frick and Frack was that I don’t entirely disagree with them. Yes, I appreciate what police and firefighters do. But being able to retire with a 90% pension at age 50, as many public safety employees do, is nuts.
Marcia Fritz, a Sacramento pension watchdog, has argued that at the state level, billions could be saved if the average retirement age of public safety employees went from 54 to 59 and the average for other employees went from 59 to 64, which sounds reasonable to me.
But you can’t wipe out existing contracts, so Righeimer wants to outsource a variety of city functions.
“This is crazy,” he thought last year when he saw that Costa Mesa was spending about $2.5 million a year on a police helicopter fleet shared with Newport Beach. The city could get the same service for $525,000 maximum, he said, by hiring Huntington Beach helicopters at $700 an hour.
Righeimer handed me a printout of total compensation for every one of Costa Mesa’s several hundred employees. It shows that 85 of them — almost all of them from the police and fire departments — cost the city more than $200,000 in 2010 when you count salary, overtime, health benefits, city pension contributions and other forms of compensation.
It was no wonder that, as revenue declined over the last four years, the city burned through nearly $35 million in reserves, Righeimer said.
He believes that outsourcing would lighten the load by getting the city out from under contracts it can’t afford. And he says it wouldn’t necessarily throw massive numbers of city employees out of work, since they could end up being hired by the private contractors. But I wouldn’t bet on it. The city says it would look favorably on bidders who hire current employees and offer them healthcare and 401(k) plans, but it wouldn’t require any of that.
Still, Mensinger said, if you can replace a $52,000-a-year park maintenance man with a private contractor who makes $12 an hour, and pay no benefits, you’re in better shape.
Are you? Is it such a good deal if the second guy ends up with only half as much money to drop into the local economy and costs taxpayers twice as much in public support?
While we were talking, U.S. Rep. John Campbell pulled up in a shiny, cinnamon red Corvette and said, as if on cue, that the feds should be thinking more the way the boys in Costa Mesa are.
You set one foot behind the Orange Curtain and they gang up on you.
Righeimer argues that pension costs are expected to rise from 15% of the budget to 25% in a few years, and now’s the time to get on top of it. That’s not a political agenda, he insisted. “I just want to balance the budget.”
OK, but if he and his posse hadn’t been such clods, they might have accomplished something other than to alienate employees. Nick Berardino, of the employee group that represents some Costa Mesa workers, told me they’d consider contract concessions. “But not with a gun to our heads.”
“The sky is not falling,” Costa Mesa Councilwoman Wendy Leece added, saying next year’s budget is close to being squared.
Righeimer and Mensinger said that Leece, a schoolteacher, just doesn’t have a head for business. Leece, who calls herself a “very conservative Republican,” supports some outsourcing and pension adjustments but thinks her colleagues are moving recklessly fast and accomplishing very little.
Did Righeimer and company really have to rush out those layoff threats before producing examples of how outsourcing to for-profit companies has saved money elsewhere? Would the city have the same level of control over contractors and would the quality of the work be as high?
If so, Frick and Frack, let’s hear it. If not, quit demonizing public employees, hammer out smarter contracts in the future, and use your so-called business acumen to diversify Costa Mesa’s economy so it doesn’t rise and fall on how many Fendi bags and Ferragamo loafers are sold at South Coast Plaza.
I’ll continue to make myself available as an outside consultant, but please remember that good help is not cheap.