MOORLACH UPDATE — Begets — June 15, 2014

It’s interesting when one article begets another one. This is the case with both of today’s pieces. The first covers the Board’s budget vote that was covered by the Voice of OC (see MOORLACH UPDATE — Budget Hearing — June 12, 2013). For a video account of the Board meeting’s discussion on the matter, see http://www.voiceofoc.org/countywide/this_just_in/article_6c07b772-d486-11e2-b0d6-0019bb2963f4.html. The Voice of OC article reverberated all the way up to the Horseshoe in the State’s Capitol Building. In this case, I agree with the Governor’s office. The incident is provided by the Voice of OC in the first article below.

Barbara Venezia’s column for The Current, a section provided by the OC Register to its subscribers in Costa Mesa and Newport Beach, provides an update on the state of Nevada’s abusing those with mental illness (see MOORLACH UPDATE — Finding Monica — April 27, 2013). It is the closer of her column, the second piece below.

RADIO BONUS: Today I will be interviewed live by Troy Davis of “Money Matters,” on KOCI-FM, 101.5, at 10 a.m. This means you have to open my UPDATE and immediately turn on your FM radio or go to www.KOCIRadio.com/. You can hear my interview with John McCauley of the “California Commerce Show,” Sunday evening at 6:30 p.m. on Titan Radio, 90.1 FM – KBPK.

Gov. Brown to OC Supervisors: Cut Your Office Budgets

By NORBERTO SANTANA JR.

County Supervisor Todd Spitzer said that when he and Supervisors’ Chairman Shawn Nelson joined state Sen. Lou Correa for a meeting on Thursday with the governor’s staff to discuss a dispute involving $73 million in property taxes, they were confronted over their straw votes this week to exempt themselves from budget cuts imposed on other departments.

Spitzer voted along with Supervisors Janet Nguyen and Pat Bates earlier this week on a straw vote for the annual Orange County budget to not make a 5-percent cut for all departments mandatory for supervisors’ offices. Nelson and John Moorlach voted for the cut.

“They [the governor’s staff] brought up your article,” Spitzer said, adding that he understood the concerns. He also said he will be switching his vote when the final budget comes up for consideration during a special meeting on June 24.

“Given the fact that it is important to the governor’s office that the board offices not just cut voluntarily but affirm it as a part of the formal budget adoption, I agreed,” Spitzer said.

“It’s the principle,” Spitzer said. “The governor’s office wants to see it mandated. And I understand the governor’s argument, and I’m happy to oblige.”

“There will now be 5 percent cut across the board from supervisors’ budgets,” Spitzer said. “I’ll be voting for that.”

Spitzer was in Sacramento as supervisors and Orange County labor officials mounted a lobbying full-court press to try to avoid having state officials take back more than $140 million in property taxes after the county lost its challenge in court.

It hasn’t been easy for one of America’s most Republican counties to ask a Democrat-dominated Sacramento for a break on an issue that was fought bitterly in court, especially after an election cycle when Orange County politicians fought Gov. Jerry Brown’s tax initiative (Proposition 30) and also provided much of the financing behind an aggressive, anti-labor ballot initiative (Proposition 32).

Spitzer said that given the recent court loss, supervisors have joined with Correa, who cast a pivotal budget vote in 2009 that gained Orange County more than $50 million in additional property taxes and now leads the effort to renegotiate that allocation.

“They were very receptive and understanding of our plight,” Spitzer said of the governor’s office.

While legislators took up consideration of a state budget Friday that includes no relief for Orange County included in it, Spitzer said, “We’ve got some good signals” that Sacramento may help the county.

Neither Correa nor Nelson could be reached for comment. Brown’s staff did not respond to inquiries by deadline.

“It’s not just about money but fairness,” Spitzer said.

Regarding exempting supervisors from across-the-board cuts, Spitzer said he always planned to institute cuts in his own office staff but wanted to allow other supervisors more flexibility.

Please contact Norberto Santana Jr. directly at nsantana and follow him on Twitter: twitter.com/norbertosanana.

An update on subjects of past columns

By BARBARA VENEZIA
FOOD FOR THOUGHT
FOR THE REGISTER

bvontv

I’m curious, as readers are, to see how the people and issues I cover continue to evolve – especially the more colorful and controversial ones.

And none was more colorful than 100-year-old TV and film director/producer Richard Bare, who I wrote about April 4. The Newport Beach Film Festival was planning to honor the Newport resident for his body of work on two nights.

I attended one of those showcasing a sampling of his work including classic episodes of "Twilight Zone" that he directed.

The place was packed.

Bare fielded questions about his Hollywood days. He was charming and funny. Now he’s hoping to bring a play to Broadway based on his long-running TV series "Green Acres."

Age hasn’t slowed him down a bit.

Another local character that sparked reader interest was 74 year-old Cornell Iliescu of Costa Mesa, who appeared in my May 16 column.

Founder of the Noble Cause Foundation, a nonprofit that pays tribute to the fallen heroes of World War II, he’s on a mission to build a memorial wall at the Orange County fairground honoring the more than 3,000 U.S. aviators who lost their lives over the Ploesti oil fields in Romania during that war.

Originally he was scheduled to pitch the idea to the OC Fair board on May 23, but it was postponed. Now, he hopes to appear before the board at its next meeting on June 27.

Readers weighed in, calling Iliescu a "true patriot" and agreeing that those who fought in WWII should never be forgotten.

Collectibles and antique lovers enjoyed the column May 1 on the Orange County Market Place at the Orange County fairgrounds and its new concept: the Orange County Antique Market.

After the column ran, organizers say, vendors flocked to sign up for the May 18 date. Plans were to continue the event after the OC Fair in August, but with their newfound success, another pre-fair weekend, June 22-23, is now scheduled.

On the controversial side, reader comments were mixed on the May 30 column regarding former Newport City Manager Homer Bludau and Newport Beach & Co. President Gary Sherwin’s efforts with the new nonprofit Newport Beach Foundation to build a leadership program in this city.

Sherwin tells me he received calls from folks supporting the idea, and I did, too. But I also heard from readers who questioned Bludau’s fitness to run such a program, criticizing some of his decisions as city manager.

The two continue to move forward and tell me they hope to have the program up by 2014.

Controversy initially swirled around Costa Mesa shelling out money to attend the Global Retail Real Estate Convention– RECon – in Las Vegas.

But it seems the group had much success, according to Mayor Jim Righeimer, who the lead the charge.

The city reported 120 visits to its booth resulting in 11 formal meetings and 15 requests for meetings/tours post-conference.

They’ve already scheduled nine of those and one took place just this week.

By all accounts, the time at RECon could be beneficial for the city in the long run.

But the column that most readers called "disturbing" ran April 25 regarding the Las Vegas Rawson-Neal Psychiatric Hospital patient-dumping scandal.

Orange County Supervisor John Moorlach and I talked about the issue after he received a call from Sacramento Bee columnist Dan Morain, whose paper broke the story.

Morain was trying to track a patient dumped in Orange County.

Though it’s estimated more than 1,500 patients were put on Greyhound buses and shipped all over the country, "we counted 27 went to Anaheim and Santa Ana, a couple of hundred to L.A. and around 300 were sent to San Diego. Statewide, it was about 500," Morain told me.

On June 12, the Sacramento Bee reported a lawsuit has been filed in U.S. District Court in Las Vegas by Sacramento civil rights attorney Mark Merin and the American Civil Liberties Union of Nevada regarding patient treatment at the hospital.

I’ll continue to follow the story.

FIVE-YEAR LOOK BACKS

June 15

1998

The first of the “LETTERS” provided in this section of the Orange County Business Journal was titled “Merrill Paid, But Blame Lies Elsewhere,” which provides another perspective on the settlement.

As an Orange County resident, I should be happy that Merrill Lynch has decided to pay $437 million to the county for its part in the bankruptcy. I would be if they were in fact guilty of any wrongdoing. I don’t believe they were.

Our former treasurer Bob Citron, his assistant Matthew Raabe, the former budget director Ronald Rubino and supervisors Roger Stanton and William Steiner are the ones to blame and the ones who should have been punished. As a person who voted for Bob Citron over John Moorlach for treasurer, I am more to blame than the firm which on nine separate occasions warned our treasurer’s office about interest rates going up and even went as far as to offer to buy back (at an $80 million dollar profit to the county) what they sold the county. As a voter, I didn’t listen to Moorlach’s real concerns regarding Citron’s investment risks, but that was the budget director and the supervisors’ job, not mine.

Citron pleaded guilty to six felonies. He got nine months of what I would consider community service and was fined $100,000. He was able to keep his $93,000-per-year pension. His assistant was found guilty of five felonies and was sentenced to three years, which he is appealing. The budget director pleaded “no contest” to the charge of falsifying public records; he got 100 days of community service. Our supervisors got off the charge of willful misconduct.

What about negligence of duty? Is this settlement fair? No.

William Jameson

Laguna Niguel

2008

Steven Greenhut, in his Sunday OC Register Commentary section column, “An affirmative action sheriff,” which expanded on his immediate reactions (see MOORLACH UPDATE — Listening Tour Continues — June 11, 2013) , so I won’t include it here. The big news in the OC Register was a piece by Norberto Santana, Jr. and Natalya Shulyakovskaya, titled “Overtime policies push 100 sheriff’s officers over $150,000.” This would be a topic later addressed by our new Performance Audit Department and our new Sheriff, Sandra Hutchens. Here is the piece in full:

Over the past decade, Orange County officials transformed the post of sheriff’s deputy into a six-figure job based on the belief that overtime was cheaper than hiring new officers.

The department’s reliance on overtime enabled most of its sworn officers to earn more than $100,000 in 2007. More than 100 earned over $150,000.

That cost $41.7 million in overtime, on top of the $318 million the county spent on deputy salaries, health insurance and retirement benefits. The overall budget and salaries have doubled since 1997, but overtime expenditures have tripled.

Acting Sheriff Jack Anderson defended the spending, saying overtime is 9 percent cheaper than hiring additional deputies and paying their salary and retirement. The department says overtime saved it $9.7 million last year.

"What you can’t negate is the fact that you are actually saving money," Anderson said. "Overtime is cheaper than paying full salary and benefits."

But a Register analysis of payroll records, public documents and extensive interviews has found that:

•The department calculated its "savings" using the salary and overtime rates of the most expensive deputies. If the department had assigned new deputies to work even half of the overtime accrued by deputy sheriff II’s in the jails, it could have saved more than $500,000 per year. If officials had replaced half of jail deputies with more basic law enforcement officers – such as special officers or correctional officers – they could have saved as much as $10million.

•Policies allowing deputies to work a three-day workweek and to retire early have dramatically boosted overtime costs. After enhanced pensions led to large numbers of retirements, deputies with four days a week off were happy to fill up the empty shifts with overtime.

•The huge amount of extra hours and the large payouts have contributed to culture and discipline problems in the department, especially at county jails. Despite the six-figure earnings, some deputies slacked off on the job. Now, efforts by sheriff’s officials to transfer deputies out of jail assignments and into patrol jobs have fueled union grievances and lawsuits.

Last year, the Orange County Sheriff’s Department spent about 12 percent of its salary budget on overtime. That’s similar to the overtime percentage paid by Los Angeles County, which is the largest sheriff’s department in the nation.

But Orange County’s overtime spending is higher than similar-sized departments. San Diego and Ventura, for instance, spent about 9 percent of their salary budget on overtime.

Because of conflicting responses from sheriff’s officials about whether the cost of overtime vs. new hires had ever been studied, the Register filed a request under the California Public Records Act asking for copies of any internal studies. That triggered a different response.

"There have been no overtime studies conducted as described," Capt. Mike James replied in a May 15 letter.

"Overtime has become a part of the culture of the public safety folks," county CEO Tom Mauk said in an interview.

"(But) the notion that overtime is cheaper than hiring more deputies is just a best guess. It needs to be carefully analyzed."

County officials across Southern California balance their budgets by keeping unfilled positions on their books.

That’s how sheriff’s officials can say that excessive overtime spending doesn’t matter because they stay within their budget. If those officials removed the vacant positions from the budget, the sheriff’s departments would go over budget virtually every year.

A new Orange County sheriff, former Los Angeles County Sheriff’s division chief Sandra Hutchens, was appointed by the board Tuesday and will take office in the next few weeks. Hutchens has promised to conduct an immediate review of departmental operations.

Whether the overtime payouts are good policy or bad, deputies are worth every dollar, said Wayne J. Quint Jr., a sheriff’s sergeant who is president of the Association of Orange County Deputy Sheriffs.

"It is a dangerous job. It is a tough job," Quint said. "It is public safety. It is hard to put a price tag on that."

The human cost

When the 2006-2007 Orange County Grand Jury noticed the large overtime payouts at the Theo Lacy jail, it sounded alarm bells. Grand jurors noted that there are advantages to using overtime – no additional pension or health care benefits must be paid.

But they added, "This savings is offset by the additional costs of overtime pay, and the stress that overtime work could, in the long run, result in an increase in sick leave and poorer job performance."

That same year, an Orange County Register investigation revealed that deputies had been watching TV and text-messaging while a Theo Lacy inmate was slain in the cellblock below.

When the district attorney empanelled a special grand jury to get to the bottom of the problems, prosecutors uncovered an undisciplined atmosphere at the facility. They found that deputies watched television, surfed the Internet and dragged mattresses into guard stations to sleep while on duty.

Acting Sheriff Anderson fired one deputy, placed five others on leave and forced out two assistant sheriffs.

Within weeks, two more deputies were fired during an investigation into whether a Taser stun gun was used to kill a cat.

And last month, prosecutors charged Deputy Jason C. Brant with falsifying reports on property crimes. Officials said he reported that citizens had refused to cooperate with investigations when in fact he had never even called them.

Records show Brant had earned more than $19,300 in overtime in 2007.

Anderson said the department has policies limiting overtime, but acknowledged they seldom have been enforced.

"We know when people are fatigued their decision-making can become fuzzy… . Somehow, their work ethic changes," he said.

$100,000-plus in extra pay

The sheriff’s pay is set by statute; assistant sheriffs who have accrued seniority often earn more than the sheriff, even though they don’t collect overtime.

But huge overtime payouts to deputies, investigators and sergeants have allowed some rank-and-file officers to come close to or exceed the earnings of top brass.

The top earners in the department last year were assistant sheriffs Charles Walters and Jo Ann Galisky – both earning just under $225,000.

But close on their heels was Theodore R. Harris, an investigator assigned to Dana Point, who made $220,869, or $5,000 more than former Sheriff Mike Carona. The largest portion of Harris’ paycheck, $119,855, came from working overtime.

Three of the top-five rank and file earners were stationed at Theo Lacy, with each earning close to $200,000.

Richard D. Ostrow, a deputy sheriff II at Theo Lacy, made $208,745. His overtime earnings, $116,226, considerably outweighed his salary.

William S. Motodera, a deputy sheriff I stationed at Lacy, was paid $196,534. Well over half of it, $106,740, was for working overtime.

Jesse M. Oller, another deputy sheriff II from Theo Lacy, was paid $191,840. The overtime portion of his earnings was $98,842.

The Register sought comment from these deputies, delivering letters to their workplace. None responded to the Register’s inquiries.

Quint said the deputies wouldn’t comment because the department has a policy prohibiting most deputies from speaking to the media. He also said Harris has been warned by sheriff’s officials that he was exceeding departmental limits and has promised to curtail his overtime.

The Register analysis shows that in 2006 and 2007, at least 80 deputies were paid for more overtime than the 24 hours per week the policy allows.

There are no state limits on how much police officers can work. A 2002 national survey showed that only one quarter of large departments limited their officers’ overtime. On average, the limit was a little over 21 hours a week.

Around the country, police departments started reining in overtime after noticing that senior officers used extra hours to boost their retirement benefits, which are usually based on the final years of an officer’s earnings.

In Orange County, retirement calculations do not include overtime, except for two small instances – time allocated for briefings and for care of service dogs.

The absolute limit that an officer could work without affecting his health is 80 hours a week, said police fatigue expert Bryan Vila, a criminology professor at Washington State University, Spokane.

The Register analysis showed that five officers exceeded that limit.

According to sleep research, the effect of long hours on reaction and decision-making becomes similar to the influence of illegal levels of alcohol in blood.

"Cops don’t come to work drunk and nobody would put up with it if they did," said Vila. "But they do come to work just as impaired by fatigue."

On average, the department’s top-ranking deputies – deputy sheriff II’s – worked 415 extra hours and made $23,757 in overtime in 2007. Sergeants averaged 304 hours and $20,864. Deputy sheriff I’s, the entry-level deputies who mainly staff the jails, made $17,221 per deputy in overtime. They averaged 339 hours of overtime. Investigators made $14,131 from overtime, or about 254 hours per person.

Even Quint, who is on formal leave from the department to concentrate on his union duties, boosted his paycheck with $35,908 in overtime in 2006 and $38,548 in 2007. The Register analysis shows that Quint is always paid for the identical number of overtime hours – 20 per paycheck.

Under the union contract, the Sheriff’s Department continues to pay Quint’s salary. The union reimburses the county for the salary, overtime and benefits.

Quint, who became association president in 1999, said his overtime payouts are approved by the union’s board of directors. His predecessor received 6.5 hours per week. As a union president, Quint asked the board to increase overtime payments to 10 hours per week about 8 years ago.

Before he was the union representative, Quint said, he was a sergeant who tried to work at least 16 hours of overtime a week, mostly in patrol.

"I work clearly more than 10 extra hours a week. … If I were to bill the association for the actual hours I work, our bills would go through the roof," he said.

The ‘Killer’ threes

County supervisors contributed to the spike in overtime costs by enacting two policies that simultaneously shortened workweek for deputies and encouraged a wave of retirements among senior deputies.

In January 2000, former Sheriff Carona approved a 3/12 workweek for deputies. That was a perk long sought by the deputies union but one former Sheriff Brad Gates had resisted because of the difficulty in managing it.

Every two-week pay period deputies work six 12-hour shifts and one eight-hour shift. That leaves them seven days off every two weeks.

"It’s difficult to manage," said Former Assistant Sheriff Dan Martini. "It’s a killer."

Then, in December 2001, county supervisors enhanced deputies’ retirement benefits by allowing them to retire at age 50 with 3 percent of pay for each year served at the department. A deputy with 30 years’ service could get 90 percent of his pay at retirement. Under federal law, no one can receive more than 100 percent of pay.

According to figures from the Orange County Employees Retirement System, retirements in the Sheriff’s Department jumped from 29 in 2001 to 93 in 2002. Retirements since 2002 have remained at more than 50 a year since, twice the pre-2001 levels.

Anderson said the large number of retirements is creating vacancies that are difficult to keep up with because of the time it takes to find recruits and get them through the academy. "We have an issue with people retiring. We’re constantly hiring behind those."

After increasing from $20.8 million to $29.6 million in 2001, overtime costs stayed stable at about $25 million until 2005.

That year, county supervisors contributed again to the overtime payouts when they opted to staff the expansion of Theo Lacy jail in Orange with overtime hours. The overtime budget rose to $33 million.

"Everyone knew we were building a jail," Anderson said of the 2005 expansion of Theo Lacy. "The board (of supervisors) decided not to fund it….So the sheriff decided to open up the jail on overtime."

‘Keeping it green’

With all the free time triggered by the 3/12 work schedule, the vacant shifts and little management tracking, deputies began to see overtime as a normal part of their check.

Deputies and managers alike have a nickname for the biggest earners: "overtime whores."

Retired Deputy Simon Kim – who described himself with that nickname – said the sergeants know which deputies like overtime and contact them to fill shifts.

"When you have seven days off, what do you do? I worked overtime."

In recent years the department also became adept at "keeping it green."

That slogan reflects the practice of actively seeking out contract services to keep the hours flowing. One favorite post under the Carona regime was the Orange County Fair, which switched its patrol contract to deputies soon after the sheriff’s wife was appointed to the board of directors.

"Every July, it’s Christmas for everybody," Kim said. "Even the lieutenants get into the action."

While Kim was eventually sanctioned for excessive overtime, sheriff’s officials confirmed they did not have a way to regularlytrack the overtime payouts and hours worked by individual deputies.

That changed in May after the Register’s inquiry.

Anderson said a new program had been instituted that sends electronic reports to managers each pay period to allow for individual tracking of overtime.

Resistance to change assignments

The overtime payouts have changed deputies’ preference in assignments.

Most deputies have become so accustomed to the schedules and paychecks of jail duty that they are resisting efforts to move them into patrol assignments.

Anderson sought to encourage transfers and promotions out of the jails and into patrol assignments. The deputies sued in court, albeit unsuccessfully, to stop him.

Court filings show approximately 180 deputy sheriff II’s in the jail who are eligible to request transfer to patrol. Only ten have done so.

"That leaves 170 eligible personnel who have chosen not to seek a transfer to patrol," county lawyers said in a court filing. "This creates operational problems for the sheriff."

Anderson’s plan was to offer promotions to deputy I’s who agreed to transfer into patrol. Five deputies took the deal.

Anderson is also fighting the deputies union over a change to the 3/12 work schedule that he says could save taxpayers $500,000 annually.

He wants jail deputies to start their eight-hour shift early in the morning and work through the day instead of starting in the afternoon and working at night, when all inmates are asleep.

Meanwhile, the union is arguing that officials are actually underpaying overtime amounts, saying that the four hours above 40 in the second week of the 3/12 schedule should be paid as overtime.

And another deputy action, known as a "donning and doffing" lawsuit, seeks to recover overtime for the time that deputies spend dressing and undressing from their uniforms.

"Government entities should be paying their workers the legal wage they are entitled to," Quint said.

Anderson has also suggested hiring correctional officers instead of deputies, arguing it could save as much as $10 million each year.

A departmental spokesman argued Thursday that switching assignments to lower-paid officers may not be possible because of different training requirements and the union contract.

But County Board of Supervisors Chairman John Moorlach and county CEO Mauk both said they want the county’s new performance auditor to take a look at overtime spending patterns.

"Someone," Moorlach said, "has to start justifying this to us."

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