Pension Hawk Moorlach Asks Unions for Concessions in Letter

In Supervisor John Moorlach's letter to county employees, he warns of rising pension costs; Negotiations with county employee unions are this year.

Orange County Supervisor John Moorlach, a prominent public employee pension hawk, wants this year's employee compensation negotiations to result in cuts that tie total compensation to revenue.

He sent a letter to all county employees -- as well as major media outlets countywide -- asserting that the unions' compensation growth is at unsustainable levels. Moorlach cites statistics from the county budget office showing the average public employee compensation package -- including pension benefits and health insurance -- has grown by more than 17 percent over the past five years. (See the graph attached to this article, which he also included in his letter).

"In total, the Average Total Compensation across all of the County’s positions has grown by nearly $15,000 over the last four years, equivalent to a raise in total compensation of 17.2 percent," Moorlach said. "During this same timeframe, property tax revenue, which represents the overwhelming majority of our General Purpose Revenue, has grown scarcely more than 3 percent."

He goes on to say in the letter that employees should take salary and wage cuts, pay a greater percentage of their remaining wages to their retirement contribution and take cheaper health insurance.

"Going into fiscal year 2012-13, property tax revenues are expected to remain flat," Moorlach states. "Consequently, total compensation must remain flat. In order to achieve this goal, some forms of compensation will need to be reduced in order to counterbalance growth in other areas of compensation."

Moorlach said reductions won't need to be as drastic as at some other agencies, but will need to continue in future years.

"These reductions will not need to be at the levels seen in some of our peer counties or at the State (which is looking at a 5-percent reduction in 2012/13), but will need to be sufficient to offset the anticipated growth in other forms of compensation, like pension contribution and health benefits," he stated in his letter.

Read Patch.com in Orange County's 2011 four-part series dealing with public employee compensation and pensions:

tinytom June 23, 2012 at 04:25 PM
In daily business and personal business transactions I trust the counterparties I'm dealing with. If not I go somewhere else.
Chriss Street June 23, 2012 at 07:52 PM
John Moorlach is the Pension Hawk of pension reform, then maybe you could say it is the Chicken Hawk of pension reform. For 17 years Moorlach has filled out the form to "elect" to take the Orange County defined benefit pension and now has approximately a $100,000 annual pension he will collect every year for the rest of his life, along with lifetime healthcare. Pat Bates never took the pension and has never been a hypocrite on this issue. The estimated value of Moorlach's pension is in excess of $2 million. The problem with pension are Republicans-in-name-only who talk big as fical conservatives, but surreptitiously take the money when the press gives them a free pass..
Penny Arévalo (Editor) June 24, 2012 at 01:56 AM
Esmael, please no cussing or "masked" cussing. It's a Patch rule. Thanks.
Yeparoo June 24, 2012 at 02:02 AM
Et tu Panglonymous? Ya know ya post on boards for enlightened discussion and you either get insulted or once in a while challenged to think. Ok. "... in culture today." Maybe trust. But not today. Trust may have been lost long ago, if it ever really existed outside of closely bonded families. How about what is missing from culture today is: "culture."
Yeparoo June 24, 2012 at 03:00 AM
@Chriss Street - I am not sure which is more troubling, county pensions available to elected representatives of county government or the county's lack of investigative reporting to cover conflicts of interest and government malfeasance. My understanding is that CA State Senators and Assemblyman do not have state pensions available to them. Pensions available to elected county officials creates a huge conflict of interest and with their snoots pushed into the pension pie, I don't believe they could make decisions in the best interest of the citizens of OC. As far as oversight or investigative reporting, OC has been light in that category since 2001. That is the year Orange County News Channel folded and about the time newspapers saw a decline in revenue resulting in diminished resources for investigation. It is unfortunate that OC could not get a separate Nielsen Rating from the LA market to justify a local broadcast station for OC. OC is bigger than many markets that have several network affiliates and one of the more lucrative demographics in the country. Too bad that didn't work out. OC is now lightly covered when it comes to hard reporting. Are you THE Chriss Street? If so, I have a question that you might know the answer to. Do you know the approximate cut the the pensioners in 1995 during the bankruptcy? That was about the time the internet was born and the only info I have found is Mark Baldassare's book and the PPIC report. Neither discuss the cuts.
Panglonymous June 24, 2012 at 08:37 PM
"How about what is missing from culture today is: 'culture.'" Got a good counter trend example on file? Something deepening, broadening and uplifting these days?
Panglonymous June 24, 2012 at 08:42 PM
Ever experienced a disastrous effect from a breach?
tinytom June 25, 2012 at 12:07 AM
Went to small claims court once over a non-payment of a credit card charge. The other guy won with just one piece of paper as evidence. Turns out he was a retired attorney and he knew the judge.
Yeparoo June 25, 2012 at 12:31 AM
Our youth. I'm finding that many are living simply out of necessity, but living simply can be nice and be freeing. When the economy turns (and it may be awhile), hopefully they will continue to live simply and responsibly the way my grandparents did after the depression. I think the youth that are not looking for hand outs, but working hard to make their way in life, will continue to be practical and sensible because of the memory of the great recession. I was really encouraged by the article in the OC Register this morning about 10 high school graduates who will 'change the world.' So optimistic and inspiring. I just wish they weren't saddled with so much public debt. http://www.ocregister.com/news/high-360254-county-graduates.html
MFriedrich June 25, 2012 at 12:59 AM
Unfortunately, the writing is on the wall for public employee unions. The game will never be the same. The host has no more blood. Even the staunchest proponents of union ideals in the Democratic party are now seeing how all this pension entitlement theater is starting to play out in public opinion polls, etc.The fact that union member dues are donated to bribe politicians to raise taxes higher just makes unions look even worse in times likes these. After the housing market crash and soon coming monetary crisis, no public relations work can put make up on that pig. It's hard to imagine public sentiment improving near term regarding unions. It's been a complete disaster and they know it. Unfortunately, it's only going to get worse in the next 5 years because soon the US federal govt will not be able to raise future debt cheaply to cover the interest on current debt. California has a way out though. It's called bankruptcy. It should be embraced. Higher future costs of borrowing? So what. It would free itself from all union contracts and could start over.
MFriedrich June 25, 2012 at 01:09 AM
I would say the most lacking thing in American culture today is the concept of moral hazard. This deficit has been amplified over the last 7 years both during and since the housing crash and economic meltdown. Moral hazard is a situation where there is a tendency to take undue risks because the costs are not borne by the party taking the risk. The US has moved away from the ideal of rugged individualism in favor of public entitlements and bailouts. Before, if you gamble and lose, it was your loss. Today, you gamble, you lose and your more prudent neighbors must pay for your losses. It's unfair and unjust. Moral hazard has reared it's ugly head over and over - appying to the sub-prime mortgage crisis, Lehman Brothers, AIG, American homedebtor HELOC abuse and even state pension crises in some respects. Moral hazard is dead and American contract law all but destroyed.
Panglonymous June 25, 2012 at 05:45 AM
Interesting, Yep, thanks. Your nod to those acting with faith that the continuity of the system will prevail (a basic conservativism, if I've got it right) and to the merits of living simply and responsibly is not lost on me. Rough and random impressions: Can youth tolerate a pause? Can youth, in toto, know what a pause *is* anymore? - "...Dana Hills High School graduate Aliza Braunstein is headed to UC Berkeley to study business, especially as it relates to medicine..." Doesn't this 'clink' (insult the ear) smack of 'course before the heart?' - The OC Register shouldn't saddle these kids with these ridiculously high expectations - those expectations can only be applied constructively and legitimately by the kids themselves (and even then, I'm not sure how constructive they might be.) - Why isn't there one graduate who is lauded for questioning (substantively) the basis for the awards (in the supposition that awards are generally issued to define and reinforce the structures of the status quo)? - What is the distinction between those youths tolerant of the contradictions extant in the status quo - faithful that 'order' will be restored, confident that their patience and 'prudence' will be justified - versus those who have rejected the likelihood, 'informedly,' that reform is imminent, or even possible?
Panglonymous June 25, 2012 at 05:45 AM
The OC Register's list of '10 graduates who will change the world' lacks even a single primary major in the arts. What does that imply? Who are their nominators and what is *their* motivation?
Panglonymous June 25, 2012 at 05:47 AM
Why was that 'disastrous?' (not that it wasn't, just wondering)
Panglonymous June 25, 2012 at 05:50 AM
The 'hazard' is when one is guaranteed against losses - which is immoral, given that one is assuming risk - i.e., it's a rigged system. Yes? Can moral hazard be corrected by anything short of the legitimate restoration of the rule of law? Or systemic failure?
Panglonymous June 25, 2012 at 05:58 AM
...and which is more likely?
Yeparoo June 25, 2012 at 06:28 AM
They are both likely. But the return of failure as a natural consequence will only appear after the folly of moral hazard is exposed for the fraud that it is. mfriedrich - Not fair. You brought an essay to a word game. Going to my mailbox now to collect my check for harm.
CDC June 25, 2012 at 01:20 PM
This sounds great. We can also go after the politicians retirements as well. They are also on the gravy train dole. http://www.ocregister.com/articles/county-352137-measure-pension.html While we are at it, how about officers in the military? They make buckets more than teachers retirements and are also costing tax payers. http://www.militaryfactory.com/military_pay_scale.asp
OC Dude June 25, 2012 at 01:47 PM
Well...I'm going to go to work now at my "overpaid" County job now! I will do my best to serve the public (that has entrusted me with that duty). I take my job/duty very seriously and don't complain or need thanks. What would be nice is for (the minority) of you to stop sending me harassing e-mails at work and bashing me like I don't exist. If you want a good debate or to get elected...keep the hard working people of OC out of it!
tinytom June 25, 2012 at 01:59 PM
It was the opposite of disastrous. I didn't see your word disastrous.
CDC June 25, 2012 at 03:32 PM
I actually think you should be making more at your county job. That is, more so you can put it in a matched 401k, not a pension retirement. Nobody has an issue with your salary, it is the public sector pensions that are breaking us. Since people are living longer and still getting full medical and colas which is not sustainable.
tinytom June 25, 2012 at 03:50 PM
Can odds be put on free will.
Panglonymous June 25, 2012 at 04:31 PM
Reject misdirection: union as scapegoat is laughable. The Finance/Insurance/Real Estate (FIRE) cohort is at the base of this crisis. They bear the greatest responsibility here because, indisputably, they created the grossest destructive effects. Moral Hazard 1: Criminal Immunity You will not be regulated, charged nor punished for practicing control fraud - you will bear no criminal risk for your criminal actions - you will be allowed to continue your practices indefinitely, for when your fraud unravels... Moral Hazard 2: Immunity to Losses ...you will bear no financial risk, as public monies will be supplied to guarantee you against losses. Unions may need reform, but a union plays a constructive role in society by promoting security, stability and protection against gross exploitation in the workplace for working/middle class people. They advocate collectively for individual workers extremely vulnerable to (virtually defenseless against) the enormous collective powers of corporate employers and the crack legal teams they employ. Reform corrupt unions, sure, AND SIMULTANEOUSLY: Restore the rule of law with respect to the (FIRE) engines that do not quell conflagrations but continue to cause and stoke them. Enough finished done with THAT nonsense, eh? Eh?? - @tt: yes
tinytom June 25, 2012 at 08:33 PM
B then. Besides HR1489, anything?
Yeparoo June 25, 2012 at 08:57 PM
@ Panglonymous Private Sector Unions do not = Public Sector Unions Moral Hazard Blind Spot - Elected and Public Officials Immunity
Panglonymous June 26, 2012 at 12:26 PM
Thanks, Yep. If labor union is anathema to the corporate form, and If the corporate form has effectively shrunken and weakened private sector unions over decades, and If the corporate form has come to fully inhabit politician$, the political proce$$ and government$, and If public sector unions have remained relatively strong - strong enough to fulfill American-Dream-level middle-class aspirations, Why would corporogovernment NOT now attempt to shrink and weaken public sector unions, the last full-strength bastion of the form?
Panglonymous June 26, 2012 at 12:27 PM
To continue to press 'austerity' on the unprotected, the still-protected must be demonized and made vulnerable. Meanwhile, those beyond need of protection stay mum or seed cheers of 'selfish!' and 'no new taxes!' Yecch.
Panglonymous June 26, 2012 at 12:28 PM
tt, I'm considering hitting myself on the head with a hammer to see if I can get with the program. :-/
Yeparoo June 26, 2012 at 04:45 PM
@ Panglonymous - You have a Blind $pot.
Panglonymous June 26, 2012 at 07:12 PM
You mean like the thing$ I can't see inside a gated community? Fill it in, there, Yep. Don't be coy. :-)


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