City of Monrovia

MONROVIA - The Monrovia City Clerk's office has rejected petitions filed on September 22 seeking the elimination of a city property tax. City Clerk Alice Atkins has notified the petitions' filers with the following letter:

"On Wednesday, September 22, 2010 you submitted initiative petitions to my office for review and verification. In my capacity as City Clerk and Elections Official I have reviewed the form of the petitions prior to verifying the signatures on the petitions.

"Following that review, I must reject the petitions due to your failure to include on the petitions a copy of the Notice of Intention as required by Elections Code Section 9207. As relevant here, Elections Code Section 9207 says: "Each section of the petition shall bear a copy of the notice of intention and the title and summary prepared by the city attorney." While the petitions contain the title and summary, the notice of intention that was prepared, filed and published by you and the other proponents was not included in any document filed in my office.

"In this situation, as the Elections Official, I have a mandatory duty to reject the petitions and take no further action on them. The California Court of Appeal identified this mandatory duty in the binding and published decision of Myers v. Patterson, 196 Cal.App.3d 130 (1987). The petition defect in the Myers case was identical to the defect in your petitions. The inclusion of the Notice of Intention in the petition when it is being circulated is essential to the process because it informs the public of the identity of the proponents and their reasons for circulating the petition. A copy of the Myers decision is enclosed for your information.

"This action does not address the substantive validity of the proposed measure itself and, as Elections Official, I have no position on that subject. Rather, this rejection is based only on your failure to follow the mandatory requirements of the Elections Code. All sections of the petition are being returned to you with this letter. We will take no further action regarding these signatures and these petitions. Please be aware of the provisions of Elections Code Section 18650, which makes it a misdemeanor to use the signatures and information on this petition for any other purpose."

In May and June of this year, both the City Clerk and City Attorney sent letters to petitioners expressly stating that they would not review and/or pre-approve the petition. Instead, the petitioners were referred to the California Elections Code.

Mayor Pro Tem Tom Adams agreed, saying, "What has happened in Bell is scandalous and outrageous, but it doesn't change the fact that Monrovia's Council and staff have always been responsible in their compensation. There are apparently a few bad apples out there, but they're not in Monrovia and whatever games they've been playing aren't being played here."

Lutz also pointed out that Monrovia has held back on Council and management raises for the past two years, cut employee bonuses, and has been restructuring compensation and benefit packages for some time to keep costs down and yet sustain and expand services. Even the City Manager's contract now contains a pay-per-performance structure that has replaced the traditional bonus system.

"We've held the line on personnel costs and maintained a balanced and responsible budget," the Mayor said. "Monrovia is doing it right."

Lutz and Adams were joined by other members of the Council in condemning the situation in Bell and reassuring Monrovians of their community's financial situation:

"This Council has always been open in its financial decisions," said Council Member Joe Garcia. "I can assure the people of Monrovia that the kind of things that have gone on elsewhere could not happen here. We are transparent in our dealings for just that reason. Our budget is balanced and our salaries are well within reason."

Council Member Clarence Shaw also reminded Monrovians that, "With each budget the City adopts, we also adopt a list of our top priorities, and Fiscal Responsibility is right up there at the top every time, along with Public Safety. We will not overpay ourselves or others and put those priorities at risk."

MONROVIA - A ballot initiative aimed at ending a voter-approved 60-year-old tax on Monrovia properties may be viewed as unconstitutional and counterproductive, according to City of Monrovia officials.

The tax, lawfully enacted by Monrovia voters in 1950, is calculated at the rate of approximately 1/8 of one-percent of a property's assessed value, and is expressly dedicated toward paying municipal employee pension costs. The repeal of the tax does nothing to remove the City's financial liability to pay existing pension obligations.

The Mayor and Council members said that this would require the City's General Fund to absorb the cost of the pension obligations, which would have significant negative impacts on City services.

Petitions seeking to place the initiative on a future ballot in Monrovia were filed Wednesday, September 22, with the Monrovia City Clerk's office. The City Clerk will contract with the County Registrar-Recorder's office to assist in verifying signatures and the petition.

"It's hard to fathom just what the circulators of this measure hope to accomplish," said Mayor Mary Ann Lutz. "The tax that they want to repeal would not affect the existing pension structure or financial commitments; it just means that we would have to cut another $4.2 million from the budget or look for alternative funding sources."
The Mayor pointed out that the proposed initiative would create a $4.2 million hole in the City's General Fund budget - 2/3 of which goes to pay for police and fire services.

Additionally, she explained, "We have lived within our means and made deep cuts in our budgets over the last two years. The requirement to find an additional $4.2 million could require moves as draconian as closing the new Monrovia Public Library or contracting with Los Angeles County for police and/or fire services."

And, in order to secure a lower cost via any kind of outsourcing contract, the community would have to be willing to accept a lower level of service.

Alternatively, Mayor Lutz explained, the City would have to explore other funding options. The City of Monrovia has neither a utility user tax nor a sales tax override.

Mayor Lutz continued, "We know that Monrovia is fiscally sound and well-run, and no one is seriously planning to shut down the operations our residents want and need. This petition is not a reflection of what our community really wants and values."

Based on the recent Citizen Satisfaction Survey by the Rose Institute for State and Local Government, Monrovians approve of the level of service they have. According to the 2009 survey, 95% of the community is either "Satisfied" or "Very Satisfied" with the level of service provided, with all City departments posting respective approval ratings in the 85%-95% range.

Moreover, an impressive 81% of Monrovians said they feel that the City is headed in the right direction.
Mayor Pro Tem Tom Adams was also skeptical of the petition's effects: "For one thing, Monrovia's voters aren't about to be taken in by a plan that removes a significant amount of funding, but which doesn't identify the services that would be cut in order to balance the books," he said. "This tax was legally put in place before I was born and has served Monrovia well my entire life. To think that someone would come along and remove 60 years of funding without a better plan makes no sense. I have yet to see anyone bring in a better plan.

"Secondly," Adams continued, "No one likes taxes - surely not me; but the revenue generated here pays for existing and ongoing financial commitments. The government cannot simply decide to eliminate a tax that is paying for an ongoing obligation. The law doesn't work that way, and the petitioners should know that. They claim that they want the voters to decide; well, the voters did - 60 years ago."

City officials point to the issuance of $13.5 million in Pension Obligation Bonds as the chief obstacle blocking the electorate's consideration of the proposed initiative.

The bonds, authorized in open sessions of the City Council in July and August of 2008, were the central feature of the City's highly publicized labor dispute with the Monrovia Police Officers' Association (MPOA). Without the bonds, City officials stated that they would not have been able to secure the existing five-year labor deal with the police union.
The Pension Obligations Bonds (or POBs) are designed to "front load" the City's pension contributions for its police officers' and firefighters' pensions. By creating a level debt service payment over the life of the bonds - instead of allowing for increasing annual payments to PERS - the City is saving $2.4 million.

More specific to the agreement with the MPOA, the bonds allowed the City more flexibility to negotiate salary terms while still accounting for the true total compensation factors of salary as well as benefits.
The POBs impact the fate of the proposed ballot initiative because the revenue generated by the voter-approved property tax for retirement costs is pledged to the bondholders to pay the bond debt service. Eliminating this revenue stream triggers a fundamental tenet of constitutional law.

City Manager Scott Ochoa explained that, "Article I, Section 10 of the U.S. Constitution contains the ‘contract clause' which prohibits the government from impairing a contract between parties. Neither the City, nor even the electorate, may enact a law that somehow impairs or damages the terms of an existing contract."

Ochoa continued, "We believe that any initiative or other proposal put forth subsequent to the execution of a contract, like the POBs, that would somehow alter, injure or materially change the City's ability to honor the contractual obligations set forth in the POBs would be deemed unconstitutional."

With the issue of public disclosure among local governments so important in the wake of the City of Bell scandal, Monrovia officials were quick to point out the exhaustive public record surrounding this matter.

Mayor Lutz recounted that the POBs were publicly discussed and authorized in the summer of 2008 during the City Council's contentious contract negotiations with the MPOA; the Council's deliberations were broadcast live during their regularly scheduled meetings, repeatedly written about in City Manager Scott Ochoa's Weekly Report and reported on by the local press.

Ironically, circulators of the initiative petition have been among the police union's most ardent supporters and even call out this support in their literature. Indeed, one of the petitioners actually participated in the Council meeting when the POB' were originally discussed by the Council, at which time the Council gave direction to staff to prepare the necessary documents for the bonds' issuance.

In authorizing sale of the bonds in August 2008, the Council instructed the City staff to execute the transaction at the most opportune time - keeping in mind that the goal was to stabilize the pension cost as well as save money. Yet, as the fall of 2008 witnessed the collapse of the financial markets beginning with the failure of Lehman Bros. in September, the City's ability to secure a favorable interest rate stretched out nearly two years.

Finally, in July 2010, the POBs were sold at an attractive 6.5% interest rate, generating a savings of $2.4 million in City pension costs over the next 18 years. Once again, the bond sale was written about and published by the City and reported on by the press.

Mayor Pro Tem Tom Adams said, "The sale of these bonds made good financial sense; I don't believe the initiative does. It's obvious to me that all it would do is create financial chaos. It doesn't fix anything.

"This City Council - and previous Councils - has held Fiscal Responsibility as their number one priority. And we have been moving forward on pension and compensation reform before it had become so fashionable recently," Adams continued. "The changes to the system are already being made. If anything, this initiative would get in the way and slow down the work we're already doing."

City Councilmember Joe Garcia said that the Council hadn't taken a position on the initiative before now because, "...frankly, we haven't been able to figure out what the petitioners were trying to accomplish. They've claimed to support the MPOA contract, which is predicated on the bonds. They watched this entire process unfold. They should know that you can't just stop paying for something because you suddenly decide you don't want to anymore. The world doesn't work that way."

Councilmember Clarence Shaw agreed. "Even if this was constitutionally possible, and I don't believe it is, it's still not the right answer. To cut off $4 million per year for an ongoing obligation is going to mean coming up with $4 million from someplace else. I hear from parents and families who enjoy our services and programs; they don't want to see us eliminate programs they depend on."

And Councilmember Becky Shevlin added, "In times like these, I think the community wants to pull together to find solutions, not simply tear things apart simply to see what would happen. Based on our surveys, program evaluations and our daily interactions with folks, people want to see Monrovia succeed, not fail."

The Mayor and each member of the Council joined in pointing to Monrovia's 2009 Citizen Satisfaction Survey that showed only 7% of Monrovia's residents saying that "local government and taxes" were high on their dislike lists.

"Our residents are very happy with the way their community is run," said Mayor Lutz. "The survey done last year by the Rose Institute - during the worst part of the recession, mind you - showed that 95% of Monrovians were quite satisfied and that Monrovia is headed in the right direction.

At this point, the City will facilitate the standard process of verifying signatures and will work with the Los Angeles County Registrar Recorder to review the validity of the signatures gathered. Any substantive issue relating to the petition itself would be reviewed at a later date. "We will continue to observe the process for the time being," Ochoa stated.

Ultimately, the City Council members remained reserved and unruffled by the submission of the petition.

MONROVIA- Monrovia's Community Activist Policing program has been given a Finalist designation in competition for the International Association of Chiefs of Police (AICP) Community Policing Award.

Both Monrovia and Madison City. Alabama were named finalists for cities from 20 to 50 thousand in population. The overall winner in that category was Mundelein, Illinois.

Monrovia will be among the cities presenting at the AICP's Community Policing Workshop in October. The award was established in 1998 to recognize outstanding community policing initiatives worldwide.

"We are proud to once again have our community policing efforts recognized internationally," said Mayor Mary Ann Lutz. "We have seen spectacular results from these programs over the years and we're gratified that others recognize the achievements we've attained."

City Councilmember Clarence Shaw added that, "the concept of community policing is more important than ever as we work to assure wide participation throughout our diverse neighborhoods. The police, working closely with our residents and businesses, make an unbeatable team."

Councilmember Becky Shevlin agreed, saying, "Community policing in Monrovia combines the very best ideas and tools from bringing neighborhoods the assistance they need when they need it. Working in harmony with other programs, it has certainly been doing the job for us."

The International Association of Chiefs of Police has more than 20,000 member representing police executives from 140 countries.