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A Protest of Helix Water Rate Hikes Until Pension Abuses Are Corrected

In what has become an annual event, the district is about to increase water rates. Ratepayers have a right to expect that the money they currently pay is being spent in a productive and frugal manner before any increases are proposed. That is not now the case. One (of several) examples of the irresponsible expenditure of ratepayer money is pensions:

—Ratepayers continue to subsidize even the modest “employee share” of pension costs (about $870,000 annually). Ratepayers pay five times as much to CalPers as employees do—in a system that began, like Social Security, as a 50/50 cost sharing arrangement.

—Helix Water District employees continue to enjoy a pension plan much more generous than the one that is intended to complement Social Security. Of course, the more generous system is much more costly to ratepayers (I don’t have the additional cost, but it likely is in the millions of dollars). Few of the ratepayers paying the freight, save other government employees, can expect such lavish pensions. Especially with ever increasing life spans, the cost people retiring at 55 with 75% to 80% of salary guaranteed for life—plus another 30% percent when they get to Social Security age—is unaffordable.

—Pensions based on final year of salary only instead of the highest three years. That practice inflates pensions and makes it easy to engage in pension spiking. Social Security uses high 35 years in its calculations.

—HWD is $40 million in debt—about $15 million to the CalPers pension fund and another roughly $25 million in commitments to pay for the medical insurance for retirees and their families.

The fact that this situation (ratepayers paying retiree medical for families, for life) ever occurred is an interesting example of just how uneven things are at what, in governmental agencies, is laughingly called the bargaining table.

First, HWD employees bargained for a retirement age of 55 (need I remind you that the Social Security age is 67, and might be increased). And since once people retire at 55, they no longer have medical care [but] HWD employees then bargained for ratepayers to pay for medical care, for their entire family, starting at age 55!

Think about it. Ratepayers are so generous as to let HWD employees start drawing a pension 12 years sooner than ratepayers can, and their generosity is rewarded by a $25 million liability to pay for the health care because the employees retired so early.

Finally, the same abuses I just mentioned occur at the County Water Authority and other water entities, and these costs are included in the rates HWD is charged for water. I wonder if the HWD representative to the CWA complains about that? Actually, I don’t wonder.

I protest any increase in water rates until the abuses mentioned above are corrected.

Russell Buckley

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This entry was posted on August 14, 2012 by .
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