Support the LB businesses you see here:

Pollman pic
Click to save money: Pollman's Insurance Agency offers smart deals on home, business, specialty and classic car insurance, click here.

Taz Adventures book
LB dog gets worldwide fame thanks to LB writer and internet. Read the Taz Adventures, click picture.

Lovelace pic
Who is this guy, Bill Lovelace? Click on picture to find out.

Nino's Ristorante:
Click here if you're hungry or for catering!
3853 Atlantic Ave.

The Enterlines
Bill & Karen Enterline are ELB realty experts. Click here for info on area property values.

Return To Front Page

We Get E-Mail
Neighborhood Groups/Meetings
How To Recall a LB Elected Official
Crime Data
City Council Agendas
Port of LB Agendas
E-Mail Your Councilmember
Council District Map
LB Parks, Rec & Marine
LB Schools
References & Archives
Lost, Found & Adoptable Pets


City Management Warns Councilmembers -- Again -- That LB City Hall Is Awash In Red Ink:

  • "Outlook for FY 02 and FY 03 for the General Fund Is The Worst We Have Seen In The Recent Past," Says Memo By Dir. of Financial Mgt.
  • Council Takes 25 Seconds To "Receive and File" Report Without Discussion

    (August 4, 2002) -- LB City Councilmembers spent less than 25 seconds and did not publicly discuss a report by senior City Hall management that warned -- for the second time this year -- that LB City Hall is awash in red ink..

    At the July 30 Council meeting, a memo publicly agendized by LB's Director of Financial Management Bob Torrez and approved by City Manager Henry Taboada, indicated City Hall spending has exceeded City Hall's budgeted revenue projections by over $5 million in the current budget year (for which city management has implemented some spending restrictions to eliminate the deficit by Sept. 30/02.)

    Meanwhile, City Hall estimates a projected deficit in the 2003 budget year of roughly $46 million dollars...$10 million more than City Hall forecast three months ago (which previously reported in detail). City management promises a strategy for balancing the 2003 budget will be presented to the Council with management's new proposed budget in the coming weeks.

    The July 30 memo states in pertinent part:

    "As discussed in my Mid-Year Budget Performance Report submitted on May 7, 2002, the outlook for FY 02 and FY 03 for the General Fund is the worst we have seen in the recent past. The expected shortfall for FY 02 was reported at that time to be $4.6 million, but is now projected to be over $5 million. In order to eliminate the deficit by September 30, 2002, spending restrictions have been put in place including a soft hiring freeze. Spending restrictions include deferral of non-critical purchases, but the hiring freeze exempts police and fire sworn positions as well as communications dispatchers for the 911 Call Center. The projected deficit for FY 03 as described in the Mid-Year Report was $35.9 million, but is now estimated to be approximately $46 million when unavoidable new costs are included.

    The City Managerís budget strategy for balancing the FY 03 budget will be explained in detail in the Budget Transmittal letter with the Proposed Budget."

    The grim news was included in an item agendized as "Fiscal Year 2002 Third Quarter Budget Appropriation Adjustments," usually a routine matter reflecting changed revenues or operating conditions that take place from time to time and call for appropriation adjustments (for example, to reflect new grant revenues.) Such adjustments are routinely disclosed quarterly.

    However, the memo's serious warning -- for a second time -- of City Hall's worsening current deficit [meaning the Council has let spending outpace revenue] and the coming year's projected deficit did not prompt any Council discussion.

    The clerk read the agendized title referring to third quarter budget appropriation adjustments. The Mayor said, "Is there a motion please? Moved and seconded to approve all of the adjustments to fiscal year 2002 department and fund appropriations in accordance with existing City Council policy. Any comments? Please record your vote on item 22." The motion carried unanimously.

    Total elapsed time from the time the Mayor first spoke until the Council voted: roughly 25 seconds.

    City management's memo is a preview of what is expected to occur no later than August 15 when the Mayor must release (with her suggestions, if any) a City Hall spending plan for the coming year that has already been presented to her by City Manager Henry Taboada.

    Less than two months ago, Mayor O'Neill won an unprecedented third term write in campaign, brushing off criticism from LB fiscal reformer Norm Ryan who warned that City Hall policies meant trouble for taxpayers. O'Neill and her supporters (including much of LB's establishment) told voters City Hall was on the right track.

    During the Council's July 30 meeting (as previously reported by, Councilmembers also voted 9-0 to proceed with a three-day, corporate backed "ShoreFest" (a combination air show, shore celebration and downtown festival) in October, 2003 after a supportive city management memo said the event would require up to $250,000 in police, fire, public works and other city services but "it is anticipated that the sales taxes generated from this event will equal or exceed this amount, which will cover the cost of providing the City services."

    Since LB (and other CA cities) get only one penny in revenue for each dollar of taxable sales, we presume city management believes "ShoreFest" will generate $25 million in taxable sales (to produce $250,000 in sales tax revenue) over three days. According to City Hall budget documents, LB's total sales tax revenue for an entire year totals roughly $40 million.

    And as also reported more than two weeks ago, Councilmembers voted in July to increase pensions for City Hall non public safety employees.

    The votes mean LB taxpayers will begin paying roughly $6.9 million per year starting in October 2004 while receiving money saving agreements with five public employee unions for no pay raise this year and a 3% raise next year.

    The management negotiated, Council OK'd arrangement with CA's Public Employee Retirement System (CalPERS, created by state legislators for government employees with benefits more generous than Social Security) means roughly 3,900 city employees can retire with 2.7% of their annual salary at age 55, multiplied by the number of years worked for City Hall. (Previously, the multiplier was 2% age 55 or 2.4% at age 63. The new pension arrangement also lets non public safety employees collect 2% (up from 1.4%) of their salary at age 50.

    The "average" non public safety employee pension (average of lowest and highest paid city employees) would be $52,000 (average salary) x 2.7% x 22 years (average length of employment) = $30,888. However, the same formula allows a $100,000 a year City Hall employee who works 30 years to collect an $81,000 annual pension ($100,000 x 2.7% x 30 years).

    In November, 2001 the Council voted (6-1, Baker dissenting, Batts absent entire meeting, Grabinski absent on vote, reappearing 60 seconds thereafter) to raise City Manager Taboada's salary (with deferred compensation) to nearly $200,000 a year. Taxpayer advocates warned at the time this would lead to raises for subordinate staff with inevitable pension increases.

    The pension chain of events was set in motion in Sacramento, when the CA legislature (Assembly and CA Senate) voted to approve, and the Governor signed, a bill permitting (but not requiring) cities to pay the more generous CalPERS pensions. LB City Hall's contracts with non public safety employees contained "re-open" provisions if the Governor signed such a bill...and the unions moved to do exactly that.

    Bill Storey, LB City Hall's Human Resources Director, told that city management moved to negotiate agreements with five non public safety employee unions that will result in LB taxpayers saving money over the next two years because the covered employees agreed to receive no pay raise in the current year and a 3% raise in the next year.

    The Council's voted increase for non public safety pensions is in addition to a previously voted Council increase in pensions for public safety employees. Police and firefighters can now collect a pension of 3% of their final salary, times years of employment starting at age 50. The new public safety pensions could prompt police level retirements in the coming months, further depleting LB's thin police level.

    The new non public safety pensions may likewise trigger retirements, producing some salary savings (new hires are at lower rates) or elimination of positions (less cost but less available personnel).

  • Return To Front Page

    Copyright © 2002, LLC. All rights reserved.
    Third parties may cite portions as fair use if attributed to "" (print media) or "Long Beach Report dot com" (electronic media).