Irate Helix Water District Customers Call Pension Reform a ‘Charade’

In a move that was described as "ridiculous," "a charade," and "only token changes" by angry ratepayers, the Helix Water District on Wednesday voted to approve a new proposed Memorandum of Understanding (MOU) that will now require district employees to contribute to their retirement fund.

The new MOU will become effective in July 2011.

After months of negotiating for a new deal, the board approved the plan that would increase employee contributions to their pension system to 2 percent in 2011-12, and 4 percent in the years thereafter. Previously, Helix employees did not have to pay anything into their CalPERS, as the full 8 percent salary rate allocation was paid by the district (with monies generated from customer rates, among other revenue sources). It is currently the only local water district which does not require any employee cost-sharing.

The MOU also calls for a 2 percent cost-of-living wage increase. There was no change in the benefits premium package for HWD employees (those hired before Jan. 1, 2007, have their benefits and those of their dependents paid for in full by the district), nor in the retirement formula, in which employees are currently eligible for 2.5 percent of their highest year salary starting at age 55.

Russell Buckley and David Smyle—who together in February that monitors many East County public agencies and their spending—have been outspoken citizen activists, calling for widespread reform of the district's pension system. They have been adamant that employees should have to contribute a full 8 percent to their retirement, which is commonplace in most private sector work.

Before the vote, the public was given opportunity to comment, and Buckley and Smyle took full advantage, lashing the board on what they see as meager reform.

"It’s about what I feared in negotiations that has people on both sides representing the employees and nobody representing the ratepayers," said Buckley. [The MOU] has only token changes in it.  There is no reason that ratepayers should be paying any portion of employee pension costs. Period."

Buckley outlined the costs for the next few years, describing what ratepayers would pay into the pension of an employee making $100,000 a year. He said that in 2011-12, the employee will pay $2,000 into the pension, while ratepayers will pay $21,500. In 2012-13, the employee pays $4,000, while the ratepayers pay $20,800, and in 2013-14 the employee pays $4,000, while the ratepayers pay $24,100, nearly six times as much. 

Smyle chided the board as well, asking, "Is this the best you could do? Shame on all of you."

Smyle took particular issue with part of the MOU that requires new HWD employees to contribute only 4 percent moving forward, instead of the full 8 percent.

"Why would the current employees care that a new employee who is not even here yet pay the full 8 percent? It’s not affecting them," he said. "You’re supposed to be protecting [ratepayers] and you’re willing to make us pay 4 percent of an employee pension for someone who’s not even working here? That’s their cost. I don’t get it. It’s called an employee share for a reason."

Smyle also rebuked the board for not addressing its eligible retirement age.

"What’s the justification for employees working for this district to be able to retire at 55 as opposed to 60, or even 65 like the rest of us out there working," he asked. "It’s ridiculous. Who are you negotiating against? Us the ratepayers? It sounds like it."

Gordon Place, a fellow ratepayer, called the negotiations "a charade," and said that the board did not seem to consider its customers throughout the process.

"I’ve cut my water [usage] by 50 percent, 25 percent in the hot months. I spent money making my yard more conservation-friendly. You don’t respect any of that," Place said. "You’re just shoving this in our face, and you’ll just hand it off to someone who takes over for you while you’re out there enjoying your nice retirement."

District General Manager Mark Weston responded after the public comment, praising the district for the steps it has already taken to reduce costs and trim the budget by cutting 13 full-time and seven part-time positions over the last two years, while still maintaining high-quality customer service and one of the lowest water rates in the region.

"We understand that pension reform is necessary, and we are moving in that direction," said Weston. "Helix Water District customers can be assured that we will have a highly skilled, experienced workforce who are fairly compensated to perform the task of providing safe, reliable drinking water and protect public health."

Before the vote, board President DeAna Verbeke thanked those who commented for their suggestions and opinions throughout the process of the negotiation, adding that they did listen and consider what was brought forth, and that the negotiations were very difficult. 

She praised the employees for their dedication and service to the district and its customers.

"If you understand what these people do on a daily basis, you’ll know that we cannot hire replacement workers off the street, and that these people really do care about serving the customers," Verbeke said. "They are the district's most important and valuable asset. I think the resolutions are fair and equitable to our employees and ratepayers alike."

She encouraged the board to adopt the proposal, at which point the roll call vote was taken. Directors Richard Smith and Charles Muse voted yes. Director Kathleen Coates-Hedberg voted no, asking that her comment be read into record.

"I do not agree on the terms, and the employees should pay their fair share,” she said.

Directors John Linden and Verbeke both followed with yes votes, and the proposal was passed 4-1.

Boos and "tsssks" were heard after the vote, and Smyle stormed out. He spoke to Mount Helix Patch after the vote.

"They are full of nonsense," he said. "They talk about to maintain the level of customer service, they couldn’t do more. Are you telling me that employees wouldn’t do the same service if they had to pay the full 8 percent? It’s nuts. They are paid to do a job regardless of whether they had to contribute the full share or not. It’s a big cop out. Mr. Weston was up there not talking on behalf of the ratepayers. It sounded like he was talking on behalf of the employees. It was an absolute sideshow. Hedberg is the only one with any bravery or guts up there, and the rest of them should all be voted out at the next election."