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Council Unanimously Approves $170.7 Million General Fund Budget

Posted by on Jun 27th, 2013 and filed under Glendale, News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

By Ted AYALA

On Tuesday, the Glendale City Council approved a $170.7 million general fund budget after two months spent inspecting the city’s finances. The budget will be effective beginning July 1.

The passage of the budget represented a step forward for the city. Beleaguered since 2008 by a listless economy that required the city to adopt painful cuts, the 2013–14 general fund budget featured cuts that were the lightest in recent memory. Challenges still loom over the city, though, most notably in ballooning employee benefit and pension costs which are set to rise exponentially in the next few years.

“Those that say the pensions are too high certainly reflect a growing trend in this nation,” said Councilmember Ara Najarian. “The problem is that the solution is not easy and it cannot be draconian. It must be done with a negotiated effort and to assume otherwise … is taking an unrealistic view of the issue.”

Mayor Dave Weaver also noted that politicians that have advocated keeping a tight reign on pensions and benefits have usually had to suffer for it, to no avail.

“In 1997, if I had tried to hold down salaries and benefits to the workers of the city while all the other cities around were giving raises, I would have been recalled or ridden out of town on a rail. We had to compete [with other cities] every year. It’s not easy.”

City Manager Scott Ochoa reminded council that despite cuts the city has managed to retain a high standard of living, offering public services that are rated as among the best in the region.

“I wish we could do more in terms of compensation,” said Weaver. “But the reality is we don’t have the revenue to do it. And I know [city staff] has gone without pay raises and given more back. We know that. Those are great sacrifices.”

Mike Mohill during public comments addressed council, taking issue with Weaver’s praise of city workers and that they deserved more. He reminded him that former city staff included former police chief Randy Adams, who was connected but never indicted in the Bell finance scandal, and Glenn Steiger, who resigned abruptly last year following an investigation of his having “double-billed” the agency.

“You do not really have a balanced budget,” said Herbert Molano. “That’s a fiction you’ve maintained for a long time because you have been putting us into debt every year.”

Molano contended that pensions and benefits have grown at a rate that has “significantly exceeded” inflation.

“Don’t tell me you can’t do anything about it,” he said. “You can.”

City Manager Scott Ochoa said that using the rate of inflation as a guide on how to portion benefits and pensions is a “total fallacy.”

“That doesn’t exist in a realistic, operational, practical means of employing and running an organization,” he said. “The rate of inflation is a snapshot, but it’s not the only snapshot.”

“Our goal is to achieve structural balance,” he added. “What [council] has taken are very aggressive steps [to curb employee costs].”

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1 Response for “Council Unanimously Approves $170.7 Million General Fund Budget”

  1. Herbert molano says:

    The rate of inflation is an integral component to the employees’ contractual labor agreements and it is the change to the pension system that was a major revision and huge escalator to the pension payments.

    The claim by Ochoa can’t be defended in an open debate. Employees get both an inflation adjustment and a pay step adjustment. In addition to these increases there are other negotiated increases that raise the base of the inflation adjustment or Cola.

    But the taxpayers also guarantee the pension investments to 7.5% annually. So the pension managers have little accountability to succeed when their investment shortfall can be compensated by additional taxation, fee increases, or transfers from the electrical utility by their government/members To make up for the shortfall at the utility, the council simply approves hacking the electric rates, as they are proposing

    The key question is how to inform the public when disinformation from the council dais is now the general rule.

    Herbert Molano
    .

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