Sunday, January 29, 2012

A more sensitive city?

For over 5 years Kevin Cummins has been suggesting using sensitivity analysis when adopting budgets or getting into any medium or long-term financial deals. This suggestion has been dismissed by the council and misunderstood by the staff.

CalPERS has now decided that is a good idea to do sensitivity analysis, after earlier dismissing the idea.

From Calpensions: For the first time, the annual California Public Employees Retirement System actuarial report last fall on state and non-teaching school pensions included a sensitivity analysis.


  1. If 7.75% were a realistic rate of return, anyone would be able to buy immediate annuities that pay more than that (because the insurance company stops paying when you die, so they can offer a higher rate while you're alive).

    Plug in a 40-year-old female (youngest/healthiest option available) into this annuity calculator and you'll get an annual payment of 4.5% -- meaning the market is saying long-term returns will be even less than that!

    Yet the politicians like Jerome Stocks have put Encinitas in the position of guaranteeing 7.75% returns.

    We are so screwed.

  2. Kevin,

    Who else in the county follows your recommendations on this issue, draft reports, retention of records. Please provide us all with a matrix, so we can better support you.


  3. Kevin,

    Who else in the county follows your recommendations on this issue, draft reports, retention of records. Please provide us all with a matrix, so we can better support you.


  4. Ginny,

    Which recommendation? Sensitivity analysis, open documents, competitive contracting, safeguards on real estate transactions, low income housing, voter approval of bonding, ending underfunding of pensions?

    I hope that you weigh your evaluation on the merits of a recommendation and rather less on where it has been implemented.

    Encinitas would be the first city in the county with a sunshine ordinance. But the city of san diego did retain their emails and a lot of important stuff was made public because of it :)

    Currently, you have to go to court to have a violation addressed. Don't you think it would be better if there were another way to have violations openly addressed?

    By the way, the document I was seeking was not a draft report. It was a final report that the city lied and said it was draft.

    I don't know of other city's in the county using sensitivity analysis (other than broad case comparisons, which is on the right track). Does that make it more or less a good idea. I do know that there are people writing the government finance trade journals talking about it, so I was not the first one to bring this up. I also know that this is taught in good finance schools. So, maybe your point is that they don't do it because it is not a good idea.

    I can go over the cities that do this stuff across the state if you give me a call (strapped for time right now)

  5. Thanks, Kevin. I feel all of your suggestions are great. Ginny, anytime anyone anywhere has made suggestions, rallied support, taken action, or protested in order to make changes, there has to have been a first time for any new law.

    A Sunshine Ordinance would be great. Encinitas does not follow the laws that are on the books. The Brown Act anticipates that most closed sessions are technically part of regularly scheduled meetings. This is true for the Coastal Commission, for example, as well as the City of Encinitas. When the City Attorney schedules a closed session immediately before a regularly scheduled Council Meeting, AND REPORTS OUT OF THE CLOSED SESSION INTO THE REGULAR COUNCIL MEETING, (it should be AT THE BEGINNING of the meeting, not at the end, after or before reports, as been happening at the last few meetings), then that closed session IS considered to be part of the regular meeting, and as such, citizens are entitled to 72 hour notice.

    There are several reasons for this. Importantly, before Council and the City Manager and Clerk go into "chambers" interested members of the public have the legal right to address Council on the closed session agenda items. Perhaps ETA would like to attend, and know ahead of time of the meeting, in order to emphasize that we citizens do NOT want to continue to give salary and benefit increases to represented and non-represented employees, including the Fire Department employees.

    Special Council meetings are only required to provide 24 hour notice; however the ONLY time a special meeting is given this minimum notice is when it involves secret deliberations. Whether these are allowed by law, as contract negotiations, real estate negotiations or litigation "direction," is besides the point. Council could and should give 72 hour notice for closed sessions held before regular Council Meetings. The City Attorney knows WELL AHEAD OF TIME about these anticipated meetings. The only reason for giving limited notice is to LIMIT public participation.

    We can do better than this. Encinitas could set the standard, be a wonderful example for other cities in the County. Why do we always have to follow along with everything other cities do? We do this to try to justify pay raises, too, and yet we don't have a statewide breakdown. Also, it could be that some other cities, such as San Marcos, maintain a leaner staff, so that its staffers may have to work much harder to accomplish the same amount of work.

    Also, at the last Council Meeting, without discussion of Council, Jerome suddenly put Agenda Item 8 BEFORE oral communications, before the consent calendar, before any other agenda items. This seems brazen to me. The Mayor is not supposed to be a dictator. It seems there should have been consensus from Council to change the entire order of the Agenda, as it was noticed differently.


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