Trinity County making Humboldt look stupid: nearly doubles Humboldt’s issuance of marijuana permits in half the time

Remember how Humboldt County made history by being the first County to have a comprehensive commercial marijuana ordinance on the books? (The County’s words, not ours.)

Do you also remember how it’s going to take the County for-ev-er to process all the permits they’ve received?

(You can refresh yourself on that here: Planning Director’s estimate on processing pot permits: between 7 and 36 years for all permits received)

Well, let’s put Humboldt’s total f***ing failure to capitalize on the benefits of a legal marijuana industry (and curtail the negative aspects of it) by looking at a recent piece that appeared in the Trinity Journal relating to Trinity County’s efforts on marijuana regulation.

According to that piece, here’s the score:

Humboldt: 19 permits issued.

Trinity: 29 permits issued, with 4 more immediately pending.

Let’s also highlight this quote from Trinity Supervisor Keith Groves:

“There’s a huge misconception that Humboldt County’s ordinance is final. They have passed a land use ordinance, but haven’t gotten to anything else. I don’t think there’s a county in the state that’s as far in the process as we are. We’re ahead of Humboldt, and a lot of hours are being logged on these issues,” he said.

Groves also went on to say: “Trinity County has 33 signed licenses on file, “and Humboldt County has only 19. We also have more in the queue than they do.” He said Humboldt has no
regulations yet regarding marijuana testing labs or nurseries, and Trinity County’s Planning Commission has started to work on those topics for a final ordinance.

Never mind that the County of Humboldt had a big head start over Trinity on crafting a marijuana ordinance.

Oh – and never mind that the County of Trinity’s Planning and Building Department has, what, 5 employees? Compare that to the County of Humboldt’s Planning Department, which has 40 positions according to the budget. Also don’t be troubled by the fact that Trinity’s Planning Office is only open from 8:00 a.m. to 2:00 p.m. And closed on Fridays, too.

But we’re totally sure that the County of Humboldt is logging plenty of hours on these issues, too – they’re just not producing any results.

Let’s hope John Ford can start making some headway on turning what is perhaps the worst local government department around soon. We’re rooting for him, but also skeptical – we’ve been through 5 former Supervisors, 5 current supervisors, and at least 3 Planning Directors who have failed to have any significant positive effects on Humboldt’s Planning Department.

Read the Trinity Journal article here: Marijuana permits issued by Planning Department

We’ve also reproduced the article in full below, too:

Marijuana permits issued by Planning Department
By Sally Morris

The Trinity Journal

Apr 12, 2017
A status report on the number of commercial marijuana cultivation permits issued by Trinity County as of last week indicates that more than 250 applications are either processed or
somewhere in the pipeline, and the Trinity County Planning Department office is working to staff up to meet the demand.
The county’s urgency ordinance adopted last August to regulate and license commercial
marijuana cultivation until state rules are in place next year caps the number of county
permits to be issued at 500.
Director of Transportation, Building and Planning Rick Tippett reported last week to the
Trinity County Board of Supervisors that a total of 75 applications were received for the 2016 growing season and as of last week, 29 licenses had been issued with at least four more immediately pending.
For the 2017 season, the county has received another 174 letters of intent to pull permits, meaning over 250 of the available permits are in the midst of being processed, and there’s
been an uptick in numbers still coming in.
Regarding renewals of 2016 permits, Tippett said the department was late in preparing
those forms, so rather than expiring at the end of March, the deadline to renew has been
extended to the end of May “as long as their fees are paid by the end of April.” The
department is also working with applicants who require a rezone of property in order to
pursue licensing.

He added that existing planning staff is very busy, “and we are interviewing. We should have more assistance there any day now.”

Sup. Keith Groves said Trinity County has 33 signed licenses on file, “and Humboldt County has only 19. We also have more in the queue than they do.” He said Humboldt has no regulations yet regarding marijuana testing labs or nurseries, and Trinity County’s Planning Commission has started to work on those topics for a final ordinance.
“There’s a huge misconception that Humboldt County’s ordinance is final. They have passed a land use ordinance, but haven’t gotten to anything else. I don’t think there’s a county in the state that’s as far in the process as we are. We’re ahead of Humboldt, and a lot of hours are being logged on these issues,” he said.
Groves noted the most recent count he’s heard is that 400 Regional Water Quality Control Board permits have been issued to growers in Trinity County, “so there is still room to
participate in our program.” A water board permit is one of the requirements for a county
license.

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Humboldt Bay Firefighters ready to burn the taxpayer for first raise “in years”; THC calls B.S.

If you pay even the slightest attention to how firefighter unions operate, then you probably weren’t the least bit surprised by the Times-Standard article from Wednesday which details an attempt from Humboldt Bay Fire District’s firefighters union to squeeze higher compensation out of the District. Follow the link below:

Firefighters ask for first raise in years amid budget strife

Sure, according to a fire union representative, it’s  been nearly a decade since they’ve been given a raise “across the board.” HBF Chief Bill Gillespie concedes it has been 8 years. But has it really been that long since HBF’s firefighters got a bump in their pay?

According to the HBF Memorandum of Understanding with firefighters (see page 5 of the document), all people employed by HBF prior to December 2014 were automatically upgraded to the highest level of the 5-tier pay scale as of July 1st of 2015. Which means that all of those hired before that time maxed out on the pay scale regardless of performance or time in the position. (Which sounds an awful lot like they’re making more money than before – we’re pretty sure that’s a raise.) Here’s a link to the pay scales for the department, too; HBF JPA Payscales 2016

Digging a little deeper, if we take an average of 1.4 firefighters leaving the department between 2014 and now (14 left over 10 years, per the T-S article), then only 4 of them working now didn’t receive the benefit of maxing out their salary steps. That’s not counting any promotions, either.

(THC has gone in-depth on the racket that are fire district MOUs before, specifically looking at Arcata Fire Protection District’s MOU. All points made about the AFPD MOU hold true for HBF’s, as well. See the links at end of the post for more.)

Matt McFarland, part of the team negotiating on behalf of the firefighters who want even higher compensation, stated to the Times-Standard that 14 union members have left HBF over the past 10 years. As compared to a number of other fire districts, both close neighbors and across California, that rate of retention does not stand out from the crowd in the slightest. In fact, one might say it’s pretty darn good.

Never mind that McFarland also said that those who jumped ship “may have left for a variety of reasons that included what they saw as stagnating wages.” Which makes the claim that firefighters are leaving solely for higher wages strike THC as both conjecture and a superb job of trying to twist the actual reasons for the departure of HBF employees in order to squeeze more money out of a department that is, according to HBF Chief Bill Gillespie, struggling financially.

As always, it seems that the ugly specter of highly lucrative retirement plans for firefighters are bogging down the system and tying up the district’s available finances.

When taken together with the actions of fire districts and fire fighter unions across the county over the last couple of years, the demands for a pay raise from the HBF union underline one thing – they won’t hesitate to take any opportunity to demand higher wages, even if it cripples the District financially and thereby creates a larger drain on tax-payers’ wallets.

Oh, we’d also like to remind you of HBF’s ace in the hole, City Councilman Austin Allison, who ostensibly is negotiating on behalf of the side who recognizes how difficult it will be to afford pay increases for the District. He’s gone on record multiple times to say that he wants to ensure getting firefighters as sweet a deal as possible, including at the end of the T-S article linked above. More on Allison’s insistence to break Eureka’s bank below, too.

The inner workings of AFPD’s lucrative MOU, or, How You’re Getting Screwed

New Council Member Allison pledges to screw City of Eureka over, give fire fighters even more lucrative contracts

And for good measure, a list of what firefighter are actually receiving in compensation:

Transparent California: HBF No. 1

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California’s energy greed is paying off by price-gouging the consumer

Gee, remember the good ol’ days when your PG&E bill was 25% cheaper than it is now? Yep, 2015’s energy prices sure are a fond memory of ours.

The real kicker of a question here is: why have prices risen so drastically? What could possibly cause producing electricity to become so much more expensive in such a short time?

Unfortunately, it looks like it’s not necessarily the price of producing electricity that’s going up. The reason for sky-rocketing prices is largely due to the greed of the California Public Utilities Commission and the energy industry giants that profit from forcing needless energy plants down our throats. And don’t forget the legislators and government employees that get supported by these powers – they like the extra cash too.

In a nutshell, California is in the process of decommissioning perfectly functioning power plants decades ahead of schedule in favor of building new plants and infrastructure. The groovy thing (for the energy companies and their government cronies, not for people like you) is that the cost to construct these new plants isn’t coming out of their own coffers. The cost is being borne by the everyday, small-time consumers.

Even worse is that we currently – without the new plants being built – have a huge excess of power. According to the article we linked below, Californians are already paying prices 50% higher when compared to the rest of the country, and our costs are set to continue increasing. We don’t even remotely need any new power plants in California to meet our current needs, or projected needs for the near future – but plants continue to be built because it makes the people building them lots and lots of money.

Here’s that great article we mentioned from the LA Times that calls total bullshit on the current practice:

Californians are paying billions for power they don’t need

Maddening beyond belief is the fact that California, in response to the energy crisis of a few years ago and at the behest of the same lawmakers and commissions that are driving price increases, are actually using less energy than we were in 2008. Just like with our water usage, we’ve cut down consumption, but the regulations on our usage are becoming more onerous and even more expensive.

Food for thought from the article:

“Although California uses 2.6% less electricity annually from the power grid now than in 2008, residential and business customers together pay $6.8 billion more for power than they did then. The added cost to customers will total many billions of dollars over the next two decades, because regulators have approved higher rates for years to come so utilities can recoup the expense of building and maintaining the new plants, transmission lines and related equipment, even if their power isn’t needed.”

“Indeed, even as electricity demand has fallen since 2008, California’s new plants have boosted its capacity enough to power all of the homes in a city the size of Los Angeles — six times over.”

And now here’s our favorite bullshit quote from the article:

“We overbuilt the system because that was the way we provided that degree of reliability,” explained Michael Picker, president of the California Public Utilities Commission. “Redundancy is important to reliability.”

Sooo, Mr. Picker. Far as we can tell, the perfectly functioning plants that are being shut down in favor of the newly constructed plants were doing a swell job providing the state’s required redundancy in energy capacity – and at a much cheaper cost to the consumer.

The one development that may bring the greed of “regulated” utilities providers like PG&E into focus more acutely than any other is this: perfectly functioning plants are being retired 25-30 years ahead of schedule to allow providers to keep building new ones.

At the end of the day, the push to build reams of new plants without need is a barefaced money grab by public utilities in California – and it’s being supported and encouraged by state and local legislators and officials everywhere. We only hope that someone in the state pulls their head out in time to save us from the even higher costs projected for the near future.

Fat chance, we know, but THC is nothing if not a group of optimists. Can’t you tell?

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California legislators finally ready to put California housing industry out of its misery for good

THC has been begging our local and state legislators to do something – anything! – about fixing the dire problems facing our housing industries. As it stands now, the housing shortage is becoming far worse, and so housing is becoming more difficult to afford for any but the well-to-do.

The housing shortage is hitting low-income households especially badly, and we can all see the effects in Humboldt County. THC, and many other folks way smarter and less drunk than we generally are, also feel that the housing shortage is one of the biggest contributing factors to homelessness as well.

It looks like the California State Assembly is finally looking to do something about the problem – unfortunately, it appears like they may have decided to just kill off the housing industry entirely with the recently proposed AB 199. If it’s dead don’t fix it, right?

AB 199 is a vaguely worded bill that, on its surface, pledges to ensure that workers in the building trades are paid prevailing wage for work on housing development that are financed by public tax dollars.

But the not-so-publicized side-effects of this bill may be that it will require private housing construction to pay workers at prevailing wage as well. If AB 199 is passed as currently written, then California can pretty much kiss providing enough housing for the impoverished and middle class goodbye.

This article from the San Diego Union Tribune sums up both sides of AB 199 fairly well:

Builders say union-backed wage bill could raise housing costs

Kansen Chu and the California Building and Trades Council, a labor-union lobbyist group, say that the bill would require “workers to be paid “prevailing wage” on residential projects that have any agreement with “the state or a political subdivision” — a provision that extends the requirement beyond the redevelopment agencies, public agencies and low income housing projects covered under existing state law.”

Under current law, prevailing wage is already granted to projects that use public tax dollars. AB 199 is veiled as an attempt to fix some admittedly out-dated issues with how prevailing wages are applied – but the bill is also being used as a spring board to catapult building costs into the realm of the unattainable. Extending the bill to apply prevailing wage to private housing construction that doesn’t involve agencies mentioned above would be catastrophic for builders and people seeking housing alike.

AB 199 would extend prevailing wage to any residential project that has an agreement with any state or political subdivision – which is exactly what a building permit (required for any construction) constitutes, according to a number of opponents including legal experts and building trade advocates.

Borre Winckel, of the Building Industry association, predicts that “prevailing wage would add roughly $90,000 to the cost of building a 2,000-square-foot house in San Diego County.”

Sure, that’s a big house compared to most in Humboldt County, but consider a $45,000 price increase on a 1000 square foot home in Humboldt – how many could afford that? How many renters could afford the corresponding increase in renting such a home?

Understandably, a whole heck-ton of trade organizations have come out against AB 1911 – here’s a link to just one list of the groups that are extremely worried by the bill. (Warning: it’s a looooong freakin’ list.)

According to the San Diego Union Tribune, a little over 75,000 people are employed in building trades in San Diego County – AB 199 would do wonders for their paychecks. On the flip-side, the majority of the other 3.24 million people in San Diego County might be getting priced out of housing entirely. So, please tell us, where is the overall benefit to San Diego? And by extension, to even more impoverished places like Humboldt County with an even greater shortage of housing?

Of course, even if you’re earning at prevailing wage, you still would be hard-pressed to afford a home should AB 199 have the anticipated effects on housing costs. But the special interests that the bill would benefit don’t care – it would just mean more coin for their coffers.

(Here’s a general list of prevailing wages for a number of different trades in Northern California, for your reference.)

You might be tired of hearing THC say this to the powers that be, but, we’ll say it anyway: We need to build more housing, assholes, and the union-crony backed AB 199 looks sure to accomplish the exact opposite.

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See the Supervisors’ heavily-redacted calendars from the past two years; what are they hiding?

One lemonade-fueled night early this year, THC got to wondering precisely what it is that our Supervisors do on a daily basis. After all, with how little progress appears to be made on some of the most pressing issues in our County, it would go to reason that our Supervisors should be working their tails off in order to right the ship.

A busy schedule would also justify the 7% raises they approved for themselves last year, bringing their salary up from roughly $81,600 up to $87,400 each. (For reference, each Supervisors brought home more than $105,000 in total compensation back in 2015.) We’ll leave it to you to make up your own minds, but based on how things have gone in Humboldt over the last few years, we’re anything but convinced they deserved more money.

The good news is that THC took it upon ourselves to request the Supervisors’ daily calendars going back the past two years. Let these documents help inform your own decision about just how much “work” the Supes are doing; here are all of the County’s Supervisors’ calendars from December 29, 2014, through February 5, 2017(ish). Enjoy!

Virginia Bass Calendar 14-15

Rex Bohn Calendar 14-15

Estelle Fennell Calendar 14-15

Mark Lovelace Calendar 14-15

Ryan Sundberg Calendar 2014-15

Virginia Bass Calendar 15-16

Rex Bohn Calendar 15-16

Estelle Fennell Calendar 15-16

Mark Lovelace Calendar 15-16

Ryan Sundberg Calendar 15-16

At first glance, you’ll notice that about 40-50% of any Supervisors’ schedule is redacted, which the County justified by referring to the case of Times Mirror Co. v. Superior Court, which basically states that an elected official’s deliberative process could be negatively impacted if the public knew what they were up to. (This is legal shorthand for: elected people don’t want you to know who they are talking to, when they talked or what they talked about. Which is bullshit, but a rant that we’ll save for another day.)

For example:

“Nothing to see here” – Sundberg

On second glance, you’ll notice that a very significant portion of the calendars that aren’t blacked out are completely white – as in completely blank. As in the Supervisors weren’t doing jack shit in connection with their jobs at those times. Weird, huh? Could have been drinking wine, playing basketball or golfing, bird-watching, playing tetris. Who knows.

From our judgement, Rex Bohn wins the busy-bee award – that guy has a lot on his plate, compared to the others. Of course, there are a lot of pancake breakfasts in there. Whether all of those items are worthwhile is certainly up for debate, but 2nd District’s Supervisor sure packs it in.

We have to give the nod to Rex and Mark Lovelace for generally having the least amount of redaction in their calendar, and overall the busiest schedules. Say what you will about the nearly opposite ideologies these two brought to the Supervisors chambers – it seems like these guys put in the most work, and do it the most transparently. (Did*, in Lovelace’s case.)

Virginia Bass undoubtedly takes the cake for emptiest schedule (which makes us wonder why she didn’t even have time to read a letter she sent on behalf of the County of Humboldt), while Ryan Sundberg sits top of the heap for most redacted calendars in town. Whoever Ryan is meeting with, he sure isn’t keen on us knowing – which is a shame, because then we could figure out who was coaching him to nearly claim two Biggest Asshole Awards in a row.

Good ol’ Estelle comes in at the middle of the pack for amount of work and percentage of shady redactions.

Now, even though the Supervisors were a little too scared to reveal the majority of what they are doing and who they are meeting with, a lot can be gleaned from those blacked-out calendars by reading between the lines. Here are some of our initial thoughts:

  • If we can assume that most everything that a Supervisor does in their official capacity is recorded on their calendar, then we would be remiss not to point out that several of the Supervisors seem to have significant blocks of time with nothing on the docket. All that free time sure makes you think twice about those raises.
  • Where are the vacation days? We know that the Supervisors do take a fair amount of time off (some more than others, clearly), so where are the records of when they’re gone? A bird tells us that Virginia Bass went to Hawaii at least four times in 2016 and early 2017, but we sure don’t see her mai-tai hours recorded anywhere.
  • Why, considering the many meetings that are redacted, are there so many meetings with individuals and groups that aren’t redacted? Surely, the threat to the Supes’ deliberative process should apply to any all meetings of an official nature or that relate to some type of policy-forming…shouldn’t it?

See anything intriguing that we missed? Let us know, and we’ll update our post. Our advice is to sit back and enjoy a cold lemonade and let the overall lack of results from our Supervisors’ busy schedules wash over you slowly – if you try to take it in all at once, you’re going to need some more potent medication.

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Bad, bad St. Joseph’s to nurses: “No lunch for you!”

In just the latest development which features St. Joseph’s Hospital in Eureka being really shitty to their employees, it would appear that St. Joe’s nurses are really pissed because the hospital, as a result of chronic under-staffing, won’t allow them their legally mandated lunches and breaks. (We believe the nurses anger is compounded by their hunger, leading to the terrifying state of hangriness with which they apparently are forced to do their jobs.) Read more at the Times-Standard:

Nurses at St. Joseph advocate for proper breaks, lunches

In the interest of balanced reporting (because, as you know, we are all about balance), several individuals we spoke to that have ties to the hospital have told us that the nurses’ complaint may be a bit exaggerated, if not false. We don’t know, but still tend to believe there’s some merit to the nurses’ gripe considering St. Joe’s history.

Slightly related – did you ever hear how St. Joe’s allegedly fired a dude for reporting meth use by the nurses? Yikes. Got to stay perked up for the job if you’re not getting your energy from breaks and lunches, right?

However, the bigger point to the story here is that if the nurses are not receiving their mandated breaks and lunches, then St. Joe’s better shape up and start giving them their due. As most anyone can tell you, the quality of care at the hospital is notoriously terrible – we’d re-think going to St. Joe’s for anything more serious than a little boo-boo.

So maybe the lack of lunches, breaks, etc., can explain that away. Job fatigue is real, people. Good news for nurses is that Austin Allison, an employee of the hospital, is now a Eureka City Councilperson.

And you all know how dedicated he is to giving union employees fantastic contracts – remember?

 

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Bass signs letter to Army Corps of Engineers, unfortunately cannot read

Coast Seafoods’ proposed expansion of their existing oyster beds has been a hot topic of late, with a few different groups and agencies weighing in on the anticipated future impact to our harbor.

Enviro-minded folks cite the potential environmental impacts as reasons to at least delay the expansion, while Coast Seafoods employees like Harbor Commissioner Greg Dale are quick to say “STFU, haters, you don’t know what you’re talking about” and point to the economic benefits that oysters will rain down on the area.

THC isn’t going to wade into the issue in too much depth (yet!), but we thought this article in the Times-Standard to be revealing of the leanings of our County’s Fish and Game Advisory Committee with regards to the project:

Board OKs modified letter of concern on Coast Seafoods expansion

The T-S article is also very revealing about how much thought our Supervisors put into their jobs. Cue Supervisor Virginia Bass, who apparently couldn’t care less about the input from our County’s F&G committee or about the message that the County of Humboldt is sending to the Army Corps of Engineers about the viability of the oyster expansion project.

Here is Virginia Bass, from the T-S article, on the board’s decision to modify the letter to reflect that the opinions in the F&G Committee letter – which points out that Coast Seafoods maybe didn’t do well enough on their environmental impact report – are not the opinions of the Supervisors:

Quite frankly, I have to sign the letter, I haven’t read it all,” board Chairwoman and 4th District Supervisor Virginia Bass said about the project’s environmental impact report .””

It is shameful that our County’s top representative is so busy that she can’t even read a letter, sent by a County-appointed committee to a federal agency, on a topic of huge environmental and economic impact.

Of course, this explains how Matthew Owen continues to get his permission slips to leave the house and spout nonsense signed despite a proven track record. (That, or Virginia has finally taken our gourmet Mike’s Hard Lemonade cocktail recipes for a spin.)

As for the Board wussing out on taking a strong position on the expansion, well, what do you expect? Wouldn’t want to step on anyone’s toes, would we now, Supes? Once again, many kudos for successfully passing the buck down to anyone but yourselves.

Of course, it’s maybe even a more odd that the Chairman of our Board of Supervisor’s, Virginia Bass, is too damn lazy to bother reading a short letter that may well have a huge impact on the future of our bay. You know, that priceless, sparkling jewel that helps make Humboldt so unique?

Huzzah, Virginia – Humboldt’s finest leadership at work.

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California dreamin’ of life without the GOP; are they really the problem?

THC ran across this sobering article about the role that the GOP plays in the governance of California.

As noted in the LA Times article below, lots of folks imagine that life would be better, and governance more effective, without the opposition involved. At a time when – particularly in California – hostility towards Republicans seems at an all time high, it’s easy to get caught up in wishing for their dissolution. (Which could be around the corner.)

But people disillusioned with the GOP, and people like THC who are disenfranchised with the dominance of the two-party system, should take heed of this opinion piece from Conor Friedersdorf in the LA Times:

Dreaming of life without the GOP? Welcome to California—where things are far from perfect

The article notes that, in addition to the many successes of California as a state, “We’re a case study in what a political community looks like when Republicans wield little or no power — and an ongoing refutation of the conceit that but for the GOP, the United States would be free of dysfunction.”

The article continues:

But California ranks in the lowest fifth of states in education. Housing costs are out of control. Our major cities face a crisis of homelessness. Our police officers kill citizens at rates comparable to the rest of the country. Our infrastructure is severely overstressed due to underinvestment. The bullet train project meant to connect L.A. to the Bay Area is a national joke. Our counties, cities and schools are being crushed by an unsustainable pension burden. Our taxes are already among the nation’s highest.

Food for thought, friends.

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Pension backlash towards teacher retirements the just reward of lies and financial abuse

THC came across this opinion piece by Donna Clark in the Times-Standard:

Pension backlash puts pinch on retirement, schools

Basically, Ms. Clark’s piece says that the retirement benefits for teachers in California are not enough, and she wants the public’s help in lobbying for better benefits. (We also happen to think that Ms. Clark is herself a teacher or at least involved with the education industry, based on Facebook, HSU and TransparentCalifornia searchers, but we cannot 100% guarantee that. Which is why we haven’t linked the relevant information.)

Ms. Clark also seems to be saying that the backlash against pensions and the insistence on reform is hurting schools – when, actually, pension reform is likely in the top three things that would be of most benefit to our schools.

We’ve got a lot to say on this subject, but we’ll refrain and instead rely heavily on the words of Andrew Briggs, who is an expert on retirement policy and public sector pay. He’s also, like, way eloquent and stuff, too.

Our favorite part is how Briggs highlights that the f***ers at CalSTRS (teacher’s union) are totally frickin’ lying about the reality of teachers pensions in order to pull at the public’s heart strings. But here are some telling quotes from Mr. Briggs:

Here’s a link to a piece by Briggs that we think does an excellent job refuting the idea that the retirement benefits of teachers are not generous enough (THC emphasis added):

“California Teacher Retirement Benefits Are Hardly Modest–But CalSTRS Doesn’t Want You To Know That

The average full-career California teacher receives a pension benefit equal to 105% of their final earnings. CalSTRS CEO says the plan isn’t generous enough.

The Chief Executive Officer of the California State Teacher Retirement System (CalSTRS) believes the state’s public school teacher pension plan is too stingy. As Ed Ring of the California Policy Center points out, in December 2014 CEO Jack Ehnes wrote: “The median CalSTRS pension replaced less than 60% of final salary for the members who retired last year. CalSTRS recommends income replacement of 80% to 90% to maintain a similar lifestyle in retirement.” But Ehnes’ statements are doubly misleading: he both overstates what counts as an adequate retirement income and undercounts the benefits CalSTRS provides.

For a start, an 80 to 90% recommended “replacement rate” of pre-retirement earnings is higher than most financial planners recommend. For instance, the Social Security Administration states that “Most financial advisors say you’ll need about 70% of your pre-retirement earnings to comfortably maintain your pre-retirement standard of living.” Retirees don’t have work-related costs such as commuting; they have often paid off their mortgages and stopped saving for retirement. Their children, who the federal government estimates cost nearly a quarter million dollars each to raise through high school graduation, have usually left home. For these reasons, academic research has found that a replacement rate of 60% of pre-retirement earnings is often perfectly adequate for a retiree to maintain their standard of living. CalSTRS is raising the bar on what counts as a decent retirement income to make the plan seem less generous.

Moreover, Ehnes’ figures that compare CalSTRS retirement benefits to pre-retirement earnings are misleading, for a very simple reason: Ehnes’ figures represent individuals who only worked a partial career under CalSTRS.

In 2013-2014, the average new CalSTRS beneficiary retired at age 62.7 after 23.8 years of service. In other words, the benefit figures Ehnes cites were referencing a person who, on average, didn’t start working under CalSTRS until age 39. Should we expect CalSTRS to pay a full benefit after what may be, for many Americans these days, barely more than half a full working career?

For a true full-career employee, CalSTRS benefits are plenty generous. According to CalSTRS data, employees who worked a full career – from age 23 to age 65 – received an average annual benefit of $110,364, equal to 105% of the employee’s final salary. Almost any financial planner would call this an excessively high replacement rate, meaning that a rational employee would prefer to receive more of their compensation as salary during their working years and less in the form of a retirement package.

If so, why does this happen? Economists Edward Glaeser of Harvard and Giacomo Ponzetto of the Center for International Economic Research in Barcelona call public employee defined benefit pension plans “shrouded,” meaning that “public-sector workers better understand their value than ordinary taxpayers.” Since higher public sector salaries would meet resistance from voters, public employee unions instead push for a compensation package that is heavy on hard-to-understand retirement benefits.

This is why reforms that shift public sector employees to 401(k)-style “defined contribution” retirement plans could be so helpful. As the Manhattan Institue’s Josh McGee shows, a properly designed DC pension can provide perfectly adequate retirement benefits at reasonable cost, while adding portability of benefits that most public sector DB pensions lack. But DC retirement plans are also far more transparent: the employer contribution to employee’s retirement accounts is easily understood and easily compared to the employer match that private sector workers receive in their 401(k) plans.

The full annual CalSTRS employer contribution – something, admittedly, that is rarely actually paid – would equal 31% of employee payroll, according to the plan’s most recent actuarial valuation. By contrast, the typical private sector employee receives an employer match to their 401(k) plans of just 3% of their wages. In other words, pension costs for CalSTRS-covered employees are roughly 10 times higher than the typical private sector 401(k).

Anyone who thinks such pension plans don’t need significant reforms is either unable to understand the issues or doesn’t want you to understand them.”

 

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Fort Bragg takes action to ease housing crisis; Humboldt County, not so much

Hey everybody! Check out this news clip from KMUD which details how Fort Bragg is making it easier, and cheaper, for builders to do what they do best:

Fort Bragg loosens utility hook up requirements to incentivize affordable housing construction

It’s important to note that laudable actions like this are in all probability the only way to bring California, and Humboldt, back from the brink of a catastrophic housing shortage.

At this point, you may be thinking, “That’s swell! Where’s the news piece about Humboldt County, or any of Humboldt’s cities, doing the same thing?”

The answer, sadly, is that there is no such news story – and it’s because our local governments won’t pull their heads out and realize that deregulation will lead to an increase in housing supply.

To those who would cry “But the environment!,” we must point out that there is plenty of room for deregulating the process to build homes while still being sensitive to environmental concerns.

Our plea to make it easier for folks to build housing for the many, many hapless folks without it here in Humboldt is a simple part of a bigger solution for this County – which appears to be spiraling down the drain faster than perhaps anyone could have anticipated.

 

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