Author: Robert Fellner

DMV supervisor unaware that sleeping on the job for 4 years straight requires disciplinary action

Robert Fellner Blog ,

The most robust study ever conducted on the topic found that the average California state government worker earned 23 percent more in total compensation than their similarly skilled and educated private-sector counterpart.

That number rose to 33 percent above their private-sector counterpart, when the value of California state government workers’ legendary job security was included. But a recent report by the California State Auditor leaves one with the impression that the study vastly underestimated the true value of job security for government workers.

In February of 2014, a DMV employee was documented by her supervisors for sleeping at work. According to four separate witnesses, the employee continued to sleep at her desk for a minimum of three hours a day, for nearly 4 years straight.

The most mind-boggling part of this story is that there is no dispute that this employee was sleeping on the job, every day, for nearly 4 years.

In addition to the four witnesses, her daily sleeping was also documented by her supervisors in written, periodic performance evaluations, which the employee signed off on without disputing any of the factual allegations contained within.

When the state auditor got involved midway through 2017, the employee’s supervisor defended her failure to perform her core duty by claiming that “because she woke up the employee three to four times each day, she believed the employee missed only 20 to 30 minutes of work time daily.”

The auditor rejected the obvious falsehood that an employee who needed to be woken up “three to four times each day” somehow missed only 20 to 30 minutes of work.

The auditor instead found that the employee slept for at least 3 hours a day from February 2014 through December 2017 — a finding consistent with the statements provided by four separate witnesses and the fact that the employee’s work output was only 35 percent of the amount expected.

That 35 percent figure just reflects the number of reports the employee turned in, compared to what was expected. If we’re measuring productivity or value, it’s possible the employee was actually a net negative to the department, given what her colleagues and supervisors had to say about the few reports she did turn in:

Further, the employee’s evaluations mention that she made mistakes when entering data. In fact, during the investigation, a witness explained that the employee’s work was often so inaccurate that the witness would not trust the employee to accurately enter the witness’s own address or vehicle ownership change. Thus, the employee’s behavior may have prevented DMV from providing the public with an appropriate level of service.

So what was the final outcome? Despite sleeping on the job everyday and producing error-filled work for 4 years, the employee received no disciplinary action of any kind, and continues to collect her full salary and benefits.

What’s much worse, in my opinion, is the gross negligence of the supervisor. The DMV is a large employer. There will be some bad apples. Moreover, if an employee who is sleeping at their desk everyday receives no penalty of any kind, it’s not terribly surprising they never change their own behavior.

So what happened to the DMV supervisor who, by her own admission, did not take any disciplinary action against an employee that she needed to wake up three to four times a day, every day, for 4 years?

Nothing.

While the auditor recommended that the DMV take disciplinary action against the supervisors, the DMV countered that because they had no prior issues, they would instead only require that the supervisors undergo training to ensure they understand that employees who sleep on the job every day for four years should be disciplined, should such a situation arise in the future.

And that is why so many are critical of government. It’s not because this story is reflective of government employees generally — it’s not. The audit only occured because of the employee’s coworkers who blew the whistle.

The continually justified criticism of government, however, is that it is a grossly negligent and irresponsible steward of taxpayer dollars — something perfectly reflected in the DMV’s response to the auditor’s findings.

1,237% increase in promised pensions dwarfs San Diego’s economic growth, taxpayers’ ability to pay

Robert Fellner 2018, Press Releases

The total pension benefits promised by the San Diego County Employees’ Retirement Association (SDCERA) increased 1,237 percent from 1986-2016 — an amount which is over 300 percentage points more than the increase found at CalPERS over that same time period.

After tracking fairly closely with the other economic indicators from 1986-2000, the size of promised pension benefits exploded after 2002, as shown in the chart below:

SDCERA1200

This sudden growth reflects a dramatic benefit enhancement approved by the county Board of Supervisors in 2002.

Transparent California Executive Director Robert Fellner blames a broken governance model as the key factor behind such recklessness:

The 2002 enhancement was approved, in significant part, because U.S. state and local pension plans like SDCERA employ accounting methods designed to hide the true cost of the promised benefits — despite such methods being outlawed in the private sector and rejected by public pension plans in over 100 countries worldwide.

This scheme incentivizes politicians to over-promise benefits on the backs of future taxpayers — as they are immediately rewarded for doing so, yet immune from accountability when the costs show up several years later.

This also explains why such lavish pension benefits are only found in the public sector. Academic studies have shown that workers vastly prefer higher salaries to higher future pension benefits. The costs of higher salaries, however, are immediate, transparent and easily understood by all.

The costs of pensions, by contrast, are inherently opaque, which makes it a uniquely effective way to covertly enhance public workers’ compensation.

The below chart reflects the cumulative growth in SDCERA’s promised pension benefits (accrued liabilities) alongside a variety of San Diego County economic metrics:

San Diego County Indicators Growth from 1986-2016
Promised Pension Benefits 1237%
Personal Income 372%
Median Household Income 173%
Inflation 142%
Population 51%

Data sources:

  • Promised pension benefits reflects the growth in accrued liabilities, as reported by the San Diego County Employees’ Retirement Association (SDCERA).
  • San Diego County personal income “is the income that is received by all persons from all sources,” calculated and reported by the U.S. Bureau of Economic Analysis.
  • Median Household Income data was provided by the U.S. Census Bureau. The Excel Trend function was used to fill in years in which data was unavailable.
  • Inflation is derived by calculating the growth in the Consumer Price Index for All Urban Consumers: All items in the San Diego-Carlsbad, CA region.
  • Population data was provided by the U.S. Census Bureau.

 

For more information, please contact Robert Fellner at 559-462-0122 or Robert@TransparentCalifornia.com.

Transparent California is California’s largest and most comprehensive database of public sector compensation and is a project of the Nevada Policy Research Institute, a nonpartisan, free-market think tank. The website is used by millions of Californians each year, including elected officials and lawmakers, government employees and their unions, government agencies themselves, university researchers, the media, and concerned citizens alike. Learn more at TransparentCalifornia.com.

Transparent California helps uncover massive fraud in LA school district

Robert Fellner News , , ,

On Monday, the Los Angeles County Office of Education and the Fiscal Crisis and
Management Assistance Team (FCMAT) released their “Extraordinary Audit of
Montebello Unified School District.”

In the introduction, the audit cites the following as an impetus for their investigation:

Prior to the teacher’s request, there were many rumors alleging that some K-12 teachers and classified employees were given the opportunity to earn large amounts of extra money for little or no work, paid from adult education funds.

Coworkers accessed the Transparent California website (www.transparentcalifornia.com), which revealed that some of the district’s instructors earned exceptionally high salaries. This led to questions about how these instructors were earning such high compensation. (emphasis mine)

District administrators were told that instructors, including classified employees, had adult education class rosters with few or no students in attendance, and this raised serious questions that prompted an internal investigation and led to discussions with the county office of education.

The audit then found many instances where “hourly pay occurred during times when classes were not in session,” and that in the majority of cases studied “the district’s payroll records did not have sufficient supporting documents to conclude that compensation paid from adult education funds was for legitimate payroll expenditures…”

In its conclusion, the audit determined that:

there is sufficient evidence to demonstrate that fraud, mismanagement and misappropriation of the district’s funds and assets may have occurred.

The audit could only state that fraud “may” have occurred, citing a requirement that only a court could definitely make such a determination.

Consequently, the audit instructed the county superintendent to immediately inform “the local district attorney that fraud or misappropriation of district funds and/or assets may have occurred,” for further action.

Nonetheless, the audit findings are such that it’s almost impossible to imagine any explanation other than fraud.

The teachers’ use of Transparent California to help uncover this fraud is just one more example of the enormous benefits such transparency provides — although certainly not one we could have imagined when we first created the site!

You can read the full audit by clicking here.

Marin County promised pension benefits up nearly 1000%, dwarfing rate of economic growth

Robert Fellner Blog ,

The total pension benefits promised by Marin County increased 982 percent from 1986-2016 — a rate 58 times greater than the cumulative increase in the county’s population, according to a just-released analysis from Transparent California.

Last week, Transparent California released Nearly 900% increase in CalPERS benefits dwarfs economic growth, taxpayers’ ability to pay, which analyzed the state pension fund.

Marin County, however, belongs to the Marin County Employees’ Retirement Association (MCERA), and is thus separate from CalPERS.

Applying the same methodology as used in the CalPERS analysis reveals that promised Marin County benefits grew even faster than CalPERS, as shown in the chart below:

MCPensionGrowth2

The below chart reflects the cumulative growth in Marin County’s promised pension benefits (accrued liabilities) alongside a variety of Marin County economic metrics:

Marin County Indicators Growth from 1986-2016
Promised Pension Benefits 982%
Personal Income 377%
Median Household Income 167%
Inflation 139%
Population 17%

Data sources:

  • Promised pension benefits reflects the growth in accrued liabilities for the County of Marin and related Special Districts, as reported by the Marin County Employees’ Retirement Association (MCERA).
  • Marin County personal income “is the income that is received by all persons from all sources,” calculated and reported by the U.S. Bureau of Economic Analysis.
  • Median Household Income data was provided by the U.S. Census Bureau. The Excel Trend function was used to fill in years in which data was unavailable.
  • Inflation is derived by calculating the growth in the Consumer Price Index for All Urban Consumers: All items in the San Francisco-Oakland-Hayward, CA region.
  • Population data was provided by the U.S. Census Bureau.

For more information, please contact Robert Fellner at 559-462-0122 or Robert@TransparentCalifornia.com.

Transparent California is California’s largest and most comprehensive database of public sector compensation and is a project of the Nevada Policy Research Institute, a nonpartisan, free-market think tank. The website is used by millions of Californians each year, including elected officials and lawmakers, government employees and their unions, government agencies themselves, university researchers, the media, and concerned citizens alike. Learn more at TransparentCalifornia.com.

Nearly 900% increase in CalPERS benefits dwarfs economic growth, taxpayers’ ability to pay

Robert Fellner 2018, Press Releases

The total pension benefits promised by the California Public Employees’ Retirement System (CalPERS) increased 886 percent from 1987-2016 — a rate 21 times greater than the cumulative increase in the state’s population, according to a just-released analysis from Transparent California.

The growth in promised CalPERS benefits dwarfs the rate found in a variety of other economic metrics, as shown below:

CalPERSGrowth4

Transparent California credits Ted Dabrowski and John Klingner of Wirepoints as the source of inspiration for this chart and analysis. In Illinois state pensions: Overpromised, not underfunded — Wirepoints Special Report, Dabrowski and Klingner irrefutably demonstrate that the true source of Illinois’ pension crisis is the explosive growth in promised benefits, not a lack of funding.

Transparent California Executive Director Robert Fellner believes the same applies to California.

“Some politicians and government unions have claimed that last decade’s market downturn is the cause of California’s pension crisis. As this data makes clear, the real cause is the tremendous growth in the size of the benefits that were promised.”

The below chart reflects the cumulative growth in promised CalPERS pension benefits (accrued liabilities) alongside a variety of California economic metrics:

California Economic Metrics Growth from 1987-2016
Promised CalPERS pension benefits 886%
Total Personal Income 331%
Total State Tax Collections 311%
Median Household Income 121%
Inflation 119%
Population 41%

Fellner observed that blaming the inevitable market downturn as the source of CalPERS funding woes is analogous to a gambler citing a bad run at the blackjack table for having less-than-anticipated funds:

“Elected officials’ willingness to take on such massive debt, not the fact that the stock market sometimes goes down, is the root cause of California’s pension crisis.”

For more information, please contact Robert Fellner at 559-462-0122 or Robert@TransparentCalifornia.com.

Transparent California is California’s largest and most comprehensive database of public sector compensation and is a project of the Nevada Policy Research Institute, a nonpartisan, free-market think tank. The website is used by millions of Californians each year, including elected officials and lawmakers, government employees and their unions, government agencies themselves, university researchers, the media, and concerned citizens alike. Learn more at TransparentCalifornia.com.

Marin union votes to strike

Robert Fellner Blog ,

Despite the fact that local government workers in Marin County receive wages higher than local government workers in over 99 percent of counties nationwide — even after adjusting for regional cost differences among the 50 states — the largest government union in Marin has formally authorized a strike, according to the Marin Independent Journal.

The dispute centers over the size of pay raises that will be provided over the next 3 years, as well as other unknown conditions. The unknown conditions reflect the fact that state law shrouds government union negotiations in secrecy, ensuring the taxpayers responsible for paying the entire cost of the eventual contract are kept in the dark.

The Marin IJ also reported that a salary survey revealed that Marin County workers are paid, on average, 7.8 percent higher more than their government peers in the Bay Area.

And this is on top of non-wage benefits (like job security, number of paid leave days, retirement benefits and health insurance) that are all significantly greater than what the average private-sector worker receives.

It is an uncontroversial fact that one of the defining features of a monopoly is its ability to obtain excess wages/profits, at the expense of social welfare.

This is true even when the monopoly in question is a labor union.

Thus, a willingness to strike despite receiving pay and benefits that are already significantly above market levels — even when that market is restricted to only other Bay Area governments — is an entirely predictable, and even rational action from the perspective of the monopoly union.

Absent a change to the state laws that grant government unions coercive, monopolistic powers, it is likely that Californians will continue to see their taxes raised in order to fund the demands of government unions.