Some say Lodi using taxpayer money to push measure
Some Lodi residents are alleging that the City of Lodi is using taxpayer money to push the proposed half-cent sales tax measure for the November 2018 ballot and is misleading citizens by not mentioning the ongoing pension crisis as a catalyst for the measure.
However, City Manager Steve Schwabauer argues that the city hasn’t done anything illegal and contends that the purpose of the measure is to maintain the city’s level of services.
After receiving a survey in the mail a few weeks back, residents recently received another flier in the mail that included a letter from Schwabauer informing citizens of the upcoming measure. The flier also included information about how much the tax increase would cost citizens, proposed ballot language and additional information on the measure and the city’s vital needs. According to Schwabauer, the flier was paid for with city funds and cost about $15,000 to mail out.
Concerned citizens Alex Aliferis, Greg Goehring and John Johnson saw the flier as a misuse of taxpayer money and felt that the flier was clearly being used to promote the tax measure.
“Cities cannot advocate for a tax measure but they can certainly reach out and communicate with the public,” Schwabauer said.
He explained that the fliers that have been sent out sought input from citizens on the services they would like the city to maintain and conveyed the results of that input.
“Those are facts. Nowhere did the city say vote for Measure S or you need to vote for Measure S or anything of that kind. The city just conveyed factual material to our citizens,” Schwabauer said. “That doesn’t mean your vote has to be yes. It includes the concept of voting no. We want the input from the public, and we want them to make a decision. Nowhere do we say which way they should decide.”
Lodi resident John Johnson questioned if the flier was sent only to registered voters. When asked who received the fliers, Schwabauer said he didn’t know exactly how the mailing list was compiled.
“My guess is utility accounts but I don’t know,” Schwabauer said.
Johnson questioned whether the mailing list was derived from utility accounts.
“I know the flier was mailed to non-utility customers who are registered voters. I know that for a fact,” Johnson said.
Goehring pointed out that at the last city council meeting Schwabauer informed those in attendance that the city is not allowed to campaign for the measure, but he feels the flier is essentially a campaign piece for the sales tax measure.
“It’s not right using taxpayer money to promote a future sales tax measure that hasn’t even been officially put on the ballot,” Aliferis said.
According to Jay Werenga, communications director for the California Fair Political Practices Commission, any violation of the Political Reform Act is subject to a penalty of up to $5,000 per violation, depending on the nature and seriousness of the violation.
Schwabauer said he’s not too worried about the penalties because the city hasn’t done anything illegal.
Aliferis, Johnson and Goehring also felt the flier misleads citizens into believing the purpose of the measure is simply to provide city services by not mentioning that the reason for the measure is spiraling pension costs.
“They are misleading voters that it’s going to go for the homeless or for services when you and I know it’s going to the city facing a spiraling pension crisis, and they need future money to fund the pensions. It’s not going towards any services,” Aliferis said.
Goehring also feels that the main reason for the measure is pension costs.
“Apart from the spiraling pension costs, the City of Lodi would not have a revenue problem,” he said. Johnson had similar thoughts. “If the sales tax measure doesn’t pass, the city is going to have to make some tough choices, but the only reason the sales tax measure is on the ballot is because of (pensions),” Johnson said. “Steve knows that and so does everybody else down at City Hall. They just don’t know how to solve the problem.”
Schwabauer said he didn’t feel that the city was being misleading and added that the measure is not about pensions.
“The choice we as a community face is not about (pensions),” Schwabauer said. “The issue is what are we going to do as result of the fact that our budget is out of balance. If not paying CalPERS (California Public Employees’ Retirement System) was an option, they would be correct. But I’ve been very clear, I have never hidden behind what the issue is that’s driving our budget into trouble. It is PERS, there is no question about it.”
Schwabauer says the question facing voters isn’t if the city is going to pay the pension bill, arguing that asking that question would mislead voters into thinking that buying out CalPERS was an option.
“It’s not an option. The option that we face is what kind of services are we going to have as a community, so that’s the focus,” Schwabauer said.
According to Schwabauer, to leave CalPERS, which manages pension and health benefits for millions of public employees, the city would have to pay 100 percent of its unfunded liability calculated at a rate of return of 2.5 percent, which is somewhere north of a half a billion dollars.
“We couldn’t write that check. We couldn’t borrow the money,” Schwabauer said. “We wouldn’t qualify for the loan. We couldn’t carry the interest on the loan. Financially it’s not possible for us to leave PERS because we can’t write a half-a-billion-dollar check to PERS.”
If the measure fails, the city will have to look at cutting city services and would use resident input to determine which ones to cut, Schwabauer said. He added that the city has already made significant cuts to make ends meet and the number of city employees has been reduced significantly as a result.
“Another option is cutting costs but that means cutting services, and that’s the choice the community needs to make. Do they want to cut services or do they want an 8 sales tax rate which is still the second lowest sales tax rate of any community in San Joaquin County,” Schwabauer said.
When asked if possibly cutting back on employee benefits not mandated by PERS, such as 401(k) matches and payments in lieu of health insurance, Schwabauer said it would create a challenge in the recruiting environment that the city of Lodi faces.
“Our police officers and firefighters actually take home 2 percent less than they did in 2008. And add the increase in their cost of health care, they’re taking home more than likely 4 percent less than in 2008,” Schwabauer said. “The same is true of our miscellaneous workers. To continue to dig into salary and benefits, it’s possible, but it will, without question, affect the quality and recruitability of our workforce.
“It’s without question a choice the community has to make,” he said.
When asked if the city could afford to be choosy given its current financial situation, Schwabauer said that’s not a decision he would make for the community he lives in.
“Your talking about a police officer that has the ability to arrest and potentially shoot people, and we’ve seen communities throughout our country make the choice of going on the low end, and what happens to those communities?” Schwabauer said. “What happened to all of the communities where we’ve seen officers who have made the wrong decision. Do we want to hire officers who are up to the standard that are not going to put our community in that position? I think we do.”
Schwabauer said the assumption that the city can just go “bargain basement” when hiring employees is frustrating and he is offended by the concept.
Ultimately, the decision is up to the residents, Schwabauer said.
The Lodi City Council will give its final vote on an ordinance that would allow the measure to be placed on the November ballot at its next meeting.