Commissioners Week of Dec 13, 2021
Josephine Commissioners had a sobering look at their PERS (Public Employees Retirement) obligations and, as Commissioner Herman Baertschiger said, it had Commission Chair Dan DeYoung pulling his hair out, “all three of em.” And that was without any discussion of the recent court ruling that said Josephine and Jackson counties owe PERS $4.7 million because of a job training program that closed, leaving a retirement debt (see Grants Pass Daily Courier Dec. 17). DeYoung took that discussion off the table, saying it was a legal matter that was discussed during their executive session Tuesday.
During their Administrative Workshop Dec. 16 Finance Director Sandy Novak gave a Power Point presentation to the board at the request of DeYoung.
“Walk us through this. I think I brought this up…PERS is kind of a dark horse out there and everybody goes “PERS” (saying this in a high voice) then they just put it away like ‘don’t ask about it. It’s being handled’ and I need to know different,” DeYoung said while thumbing through paperwork.
Novak….” Exactly. First of all the job council piece of it in 1975….the job council was formed by Jackson and Josephine counties in a joint public venture. Its purpose was to provide job related training and assistance to job seekers…”
DeYoung…” Now can I can I stop you…because I think we’re talking about PERS in general and not necessarily the job council issue because we had a conversation about the job council issue under yesterday’s executive session.”
Novak…” Well, the job council is part of our unfunded liability.”
DeYoung.. ”OK, well I don’t wanna single out the job council as part of it. I’m looking at PERS as a whole obligation. This is a court case. I really don’t think we should be talking about that element of our PERS and however that’s decided that’ll change the numbers. But I’m looking at PERS in general as how it works with our funded liability, unfunded liability and so on and so forth. People have no idea what they’re talkin’ about and it just gets swept under the rug for another period and then it comes up and then public employees are constantly being needled by PERS…you get PERS and I don’t know what PERS is then I get some staggering numbers of PERS retirement for the rest of their life and I don’t know where that program is designed to withstand something like that and therefore is our PERS liability. So, let’s go forward. Let’s skip page number one. Let’s not talk about the workforce, Rogue Valley or any of those. Let’s just talk about the generalities OK?”
Novak…” Ok, ummm, so some of the unfunded liabilities I could’ve added a couple of slides (to PowerPoint) but in general the current PERS rate, general service for PERS…these are folks who have been around for a while…that rate is 25.64 percent of total wages. Most of our folks are in….”
DeYoung…” OK, now stop right there…25 percent of total wages. So the PERS…tell me, if I got a thousand dollars what goes into my PERS…I’m assuming that I am on the PERS program.”
DeYoung…” And if I got paid a thousand dollars how much of that do I contribute to PERS and then how much of it is the taxpayer’s obligation to contribute to PERS.”
Novak…” OK, so we as a county, for current wages, are paying general service for PERS folks…. that’s general service that’s 22.4 percent and so most of our employees we’re paying about 22.42 percent.”
DeYoung interrupts…” We are paying, the taxpayers paying that to that person above and beyond what they get paid?”
DeYoung…” Above and beyond the taxpayers contributing another 22 percent for that group.”
Novak….” So, in 2001 we had the unfunded liability that was not job council but just in general what they said was our unfunded liability. We went out and got a bond to cover that and we’ve been paying on that. It was refunded in 2012 with lower interest rates, We are going to finish paying that off in 2024. We’ve got three more payments to make on it plus about $400 thousand in interest on that.”
DeYoung interrupting again…” And then we will be even with the board. Then it will be hand to mouth paycheck to paycheck.”
Novak…” No, no….wouldn’t that be lovely, cause we have this whole new unfunded liability that they keep recalculating so as of 2001, in order to be fully funded, we went out and borrowed money to pay it and then the unfunded piece has still continued to grow, if that makes sense…”
Baertschiger…” Sandy let me jump in here. Mr. Chair what has happened is the PERs program is upside down because the tier one people actually tier one tier two we didn’t collect enough money to make their retirement so now we’re playing catchup and that’s why the rates on the current people are higher to catch up for the people already in the other tiers, does that make sense?”
DeYoung…” No, you said we didn’t collect enough money and I’m being told the employee, nothing comes out of his thousand, his or her thousand dollars…we aren’t collecting money from anybody…”
Baertschiger interrupting…” No no no no. Collecting money from the government entities for the PERS program. Not collecting money from the employees. We did not collect enough money from the government entities so the retirements are costing more….and that’s a long story of why…then what we anticipated so we’re backfilling with the current rate. I think that’s a better way…Sandy is that a good way of sayin’ it?”
Novak…” Yes , so what we do is we charge each of the departments, based on their wages, for those particular employees and that is going into the pers pool and then you also have the IAP (Individual Account Program) which is the 6 percent whether its paid by the employee or employer, that’s also going to the PERS pool.”
DeYoung…” Ok so the employee pays 6 percent?”
Herman shaking his head…” No…Not in Josephine County!”
Novak…” Some employees pay their own 6 percent and in Josephine County non unions and some unions the employer, us, pays the six percent. But that goes into their PERS Iap account which is identified to that employee vs this rate that we’re talking about here which is the 22 percent goes into the pool.”
Baertschiger…” So that was out of union negotiations we agreed to do what we call ..the terminology is “pickup.” We decided as part of our union contract instead of them contributing the 6 percent the county would pick up six percent.”
Novak….” OK…and then so that’s at the 22 percent the a so we are about to pay off that bond. We are charging the department per employee 5 percent towards that bond each year and that’s now going to ramp down as we get close to paying that off.”
DeYoung…” Now when you say that and we get done paying the bond, like we paid off the jail bond, we no longer tapped the taxpayer for that bond and now you’re saying that doesn’t stop that. We won’t realize any savings at that point because we have in the meantime for the bond we have accumulated way more debt than what the bond was for. Is that what you’re saying?”
Novak…” Well, that bond is going to be paid off. How we’re paying for that bond is we charge 5 percent to the departments and that has been going into that bond debt service fund and once that is completely paid off its going to be up to you as Commissioners how you are going to move forward with it. It’s that 5 percent….”
DeYoung interrupts…” I’m going to use the sheriff for example and I don’t mean to pick on the sheriff but can he plan on whatever he paid into that PERS bond pool, can he be using that if that comes out a number of $400 thousand dollars per year whatever it is for his employee base and he doesn’t have to make that bond payment that mortgage payment again, can he use that money for patrol? Will that go into his fund or is there something else that’s going to come along saying not so fast cause you can’t count on that money because now we need to have that $400 thousand dollars for something else.”
Novak…”And that’s one of the things in the budget workshop we’re going to be talking about and making that decision. Does the 5 percent just completely go away or are we going to ramp it down make sure we’ve paid off the bond”
DeYoung interrupting…”Does it go back to the department that you’re tapping for that for the 5 percent does it go away does it go back into their budget because each department is having to budget for this PERS obligation for the bond service, debt service, right?”
Novak…” Exactly, they are. So each employee has that designation of what their rate is so we’re paying that plus the PERS bond and the IAP. Every payroll cycle we report to PERS. That gets sent up to them, ah, and then they withdraw it and we’re watching that and reconciling that into the payroll. And that’s kind of the process of how we do that. So how much do we pay to PERS is the other question I got so the total budget for PERS is $6.3 million dollars, plus the $1.2 million for the bond, plus another $500 thousand the county contributes toward IAPs for the unions that do have that so our total non-bond PERS per year is $6.8 million which is about 4 percent of our total appropriation.”
Baertschiger…” Well…that whole PERS program’s upside down it’s going to be upside down for as long as we’re all working here at the county.”
Novak…” Yes it is…and I’m looking at our deferred outflow of resources for pensions we’re looking at about $12.7 million and another 1.8 million of deferred inflow of resources which is all the actuarial so our net pension liability is about $31 million. That’s unfunded liability. So we got a bond to pay it off so that we would be even so now we’re looking at a $31 million net pension liability that we put on our financial statement. That’s an actuarial based number given to us by the state.”
Baertschiger…” That’s our share of what I call “the pickup” for all the bad years PERS had. So Sandy just for our viewers to try to simplify this for every thousand dollars one of our employee makes we got 22 and a half percent for the PERS and 5 percent for the bond so that’s 27 and a half percent so for every thousand dollars we pay the employee we got to pay an additional 270 dollars into something associated with PERS. Did I get that right?”
Novak nodding,,,” Yes….exactly right.”
DeYoung…” Of our total workforce, and how many?”
DeYoung… “How many people of the 480 are enrolled in the PERS program.”
JJ Scofield…” All of them.”
Scofield…” Except for a handful of elected officials who have the option of opting out.”
Novak…” And then there’s a few that are fill ins and what not or super part time.”
DeYoung… “OK. What is the requirement to be eligible for PERS.”
Scofield,,, “You have to work 600 hours a year.”
DeYoung… “Now it was said at election time that you want to get reelected because you have to have five years’ service before you’re eligible for PERS. False?”
Scofield…” For you its false. It depends on your age. PERS is the second most complicated retirement in the country second only to the city of Chicago but in general that statement is false because it is determinate on your age and whether you qualify.”
DeYoung…” So there’s a bunch of factors that go into that.”
Fowler…” So, if we have 480 employees, is that what I heard? How many are tier one and when will they age out so to speak?”
Baertschiger…” They never age out. Right now, their contributors. When they retire they’re no longer contributors.”
DeYoung… “It doesn’t sound like they were contributors in the first place.”
At this point the discussion touches on why the county’s employees don’t contribute to their retirement. Baertschiger said it was an enticement to get people to work for the government in lieu of higher wages in the public sector. They argued about how many of the county’s workforce are in tier one and Baertschiger claimed the legislature has attempted to fix PERS but the courts shot it down.
“Are the judges on PERS?” asks DeYoung.
During their Weekly Business Session Dec. 15 Commissioners held a public hearing to adjust user fees for the Animal Shelter, Community Corrections, Parks Department, Sheriff’s Department, Public Works, Forestry, and County Surveyor. The Animal Shelter wanted to reduce adoption fees for senior animals and add a microchipping service, Forestry added permit fees for the taking of posts, poles, rocks and mushrooms. Wood cutting permits will stay the same at $30 for commercial and $15 for personal use cutting. The Parks Department increased camping fees because of increases in the cost of personnel, contractors, utilities and supplies. Parks is also increasing fines to $100 plus three times the cost of clean-up to discourage vandalism. Public Works raised fees on site plans, the Sheriff’s Department increased fees on gun licenses and renewals and fingerprint checking. The Surveyor’s office got a new copier so they increased fees for copying. A public hearing was held to find out if anyone had any objections to the increases but no one appeared so the fee increases were all approved.
During Comments from Citizens time Judy Hinkle came on Zoom talking about the dangers of wireless radiation from cell phones and how they stress the body to make it more susceptible to COVID. The only other comment came from Mark Jones, a retired fireman with 28 years of service.
“Mark Jones…Here today to remind the three of you your role as fire chief is important. Since there’s not a fire district the three of you have jurisdiction therefore you are fully responsible for the delivery of fire and life safety services within 350 square miles of jo co. there are currently four fire districts and one municipal department serving the citizens of Illinois Valley, Williams, Applegate, Wolf Creek and the city of grants pass. All those depts have fire chiefs. Those fire chiefs and fire board members of those districts create standards and draft ordinances that directs service delivery to the citizens. The 350 square miles the three of you are responsible for are lacking standards and ordinances. It would appear there’s more requirements for someone to cut my hair then there are for someone to sell me a subscription for fire protection. There is nothing for this area saying a business selling fire service has to meet any requirements. Nothing saying the employees have to be trained to certain levels. DPSST is an accreditation agency that uses NFPA standards to issue certificates for various levels of training needed be a firefighter. However, nothing in the 350 square miles of Josephine County says you have to hold verification to provide fire protection. Currently any untrained person can form a fire department and charge citizens money for fire protection. All they have to do is talk the talk and make promises they can’t keep. They can basically commit fraud by taking money for service they can’t deliver. Your job as fire chiefs is to protect the citizens in your service area. In order to protect citizens, you have to have something in place that controls the level of fire and life safety that they receive. Something that says those delivering fire services in the area meet minimum requirements. This assures the safety of not only the citizens but the safety of the neighboring firefighters who may come to help. During a large incident, untrained, inadequate departments become a hindrance and a safety concern of other agencies who respond to the incident. Since you are the fire chiefs I ask you, do you want your fire department to be that hinderance? Do you want to be responsible for causing more harm than good? I don’t think you do. I think you want what’s best for the citizens. So that being said, I ask that you set standards for fire service delivery in the area that you are fully responsible for. It’s time to do what’s right chiefs. I also want you to know that there’s a dedicated group of citizens available to help you with this matter. Please reach out to us if you have any questions.
During the Board Review of Comments Commissioner Darin Fowler said the board should take up fire standards at the beginning of the next calendar year “and decide what we want in the undistricted area in the county.”
Baertschiger said he didn’t have any problem with having that conversation but objected to a few things Jones said.
“Mark had some very good points. He was incorrect on a few other things. There are some standards they have to meet through DPSST but they’re obviously not as high as other companies. We don’t have fire departments in the unprotected area. These are private fire companies. They aren’t departments. A department is a subdivision of other entities so they’re private fire companies. And we do have ordinance. We got a lot a ordinances on fire protection, on how you can develop your homesite and setbacks and stuff, so to say that there’s no ordinances ‘cause there are ordinances that addresses the fire issues in unprotected areas…but I’m willing to get everybody in the room and have this conversation. I always have been. I’m kinda amazed that people deem that the Commissioners’ office doesn’t want to have these conversations. It’s a little awkward coming out of the fire district not passing and then the Commissioners coming around wagging their fingers so, you know, it’s a complicated political issue but a I’m willing to have the conversation Mr. Chair.”
DeYoung agreed the board needs to take up the matter of fire standards but said first Commissioners need to get together and get all their issues down before engaging in a conversation. “You’ve got some issues, I’ve got some issues, Commissioner Fowler has issues. Let’s get all our concerns on one list so we’re not bantering back and forth.” He then reiterated his claim that it wasn’t his role to campaign for the fire district, which failed to pass last May,
Baertschiger let the board know what his issues were: “I just want to clarify something. I heard a lot of people say Commissioners are held liable and I consulted with our legal team and by statute that is incorrect. We do not have any liability. Just because there’s not a fire department the Commissioners don’t have any liability and also its interesting to note that most of the private land in Oregon really isn’t covered by any fire district or fire company or fire department It’s a perception people think it is but it isn’t and I’ll give you an example. The big fires up in northeast Oregon that burnt up all the wheat fields. That was one of the problems with that, there was no agency to call to put that out. It was not ODF protected lands, it wasn’t BLM protected land, it wasn’t Forest Service protected land. They were private lands without any fire department or district or anything. Only the towns, the little towns, they all had volunteer fire departments but they do not expand out into the county. And Sen Hansell (Bill Hansell, R-District 29) and myself went and had multiple meetings, even after it burnt up 100s of thousands of acres, we had multiple meetings with those farmers in those areas. It’s a huge area in that Pendleton area and after all those meetings they were still reluctant to create any type of fire district or fire protection. And so this is nothing new to the state of Oregon and its done by locality but when I hear people say you are responsible, well no we’re not responsible.”
DeYoung added that “We get saddled with being responsible for a lot regardless…”
In Other Matters from the Board Baertschiger complained that the money the state legislature recently allocated for combatting illegal marijuana grows is eligible to every county so Josephine will likely see very little of it. Fowler also commented on what happened in the emergency session recently.
Fowler…” They had to strike a deal get landlord renter protection so this is deal struck. I’m not so sure it’s a good deal and not sure how money is allocated. I think that Oregon’s war on landlords is relentless. There’s still some money to be applied for those who don’t wanna or cannot pay their rent, and this is turning into a long-term condition and not a temporary fix because our government needs to buy as many votes as they can for people to vote one way and not the other because they’re handed free money or free rent. And it’s embarrassing for Oregon, it’s embarrassing nationwide, that our governor is the least approved of any governor in the United States right now. She’s embarrassed us long enough. I wish she would fade into the sunset and shut her mouth but here we are stuck with a lame duck and they’re gonna tie everything around her neck on the way out the door and there’ll just be more ugliness and more one-sided no compromise. The congress here in Oregon has gone back on their word many times to work in a bi-partisan fashion, on redistricting…that got thrown out and now to work on this one it was putting your feet to the fire…we’ll give you a little tiny bit of money back. Like Herman was saying even though we’re taken twice as much…it’s just the stupidity of Oregonians astounds me.”
DeYoung launched into a disjointed speech about probably not getting the $10 million they put in for to fight illegal grows and how that money is a one-time hit but what the sheriff really needs is a permanent source of funding that will pay for additional personnel. One time funding, he said, helps for equipment and supplies but it’s hard to hire people who meet the department’s qualifications only to let them go when the money runs out. He said Baertschiger is putting together a forum for gathering ideas about funding the sheriff’s department adequately but he didn’t say when that will be held.
In other matters this week Commissioners: approved a request from a man who bought a piece of property from the county who now wants to build an auto shop, office building and pave a section for a used car lot on Rogue River Highway across from KAJO. The property owner needed the Commission’s approval before going to the City of Grants Pass with the request.
Commissioners also approved the purchase of a new chip sealer for the Public Works Department, approved allowing Shawn Martinez, Juvenile Justice Prevention Treatment Service Manager to sign for $3 million in annual grant funding, approved a map for the Siskiyou Pines subdivision even though none of the Commissioners knew what it was and approved a raise in the cleaning services contract for the Transit program. Transit Director Scott Chancey said COVID requirements are costing the service $1300 a day in cleaning and disinfecting of all the busses. He has $2.3 million from the CARES Act for public transportation systems. He said he’s had to use some of that to buy an “air scrubber,” install driver barriers, and buy PPE. He said he’d like to buy a bus washer, which would save a lot in cleaning expenses, especially since cleaning contractors are hard to find.
The Commission also approved letting Public Health Director Mike Weber use some ARPA funds for employee recognition. Weber said they usually hold a holiday potluck and pass the hat among administrators for a little money for this, but since they can’t hold a potluck because of COVID, he’d like to give each employee a gift basket. Money from the county can’t be used for employee recognition, Novak said, but ARPA funds do allow this with Commissioner approval as encouragement to keep essential employees on the job. Baertschiger said he was uncomfortable bypassing county policy but voted with his fellow Commissioners to approve it as long as this is a one-time event.
At the end of Thursday’s meeting Commissioners again complained about the $25 million recently approved by the state legislature for combatting illegal cannabis grows. They are worried they’ll end up with only about $2 million once the money is spread around to other counties and requirements such as providing for workers displaced by raids. They said legislators don’t seem to understand that a sheriff can’t spend that kind of money on what he really needs: more personnel. The rest of the state and country has no idea, DeYoung said, about how serious an issue illegal cannabis is in Southern Oregon.
Baertschiger on the Radio
Apparently Josephine County Commissioners have been hearing from constituents who believe the sheriff has plenty of money because Commissioner Herman Baertschiger spent quite a bit of his 15 minutes on the Bill Meyer Show trying to explain the difference between the recently passed levy which funds only the jail and juvenile corrections, the cannabis relief funds from the state legislature, which can only be used to fight illegal grows and the sheriff’s general budget, which is in the red. He says the Oregon Legislature comes up with money he calls “free ice cream” but can’t be relied on for long term programs. He called the $25 million released last week by the legislature for helping renters, drought relief, affordable housing and refugee settlement “free ice cream” with strings attached to politics. Baertschiger and Meyer complained about the money set aside for dealing with illegal cannabis grows because it doesn’t all go to Josephine and Jackson counties where the problem is but allows every Oregon county to apply for it, and it provides money to deal with workers displaced by sheriff’s raids. Baertschiger said he didn’t understand what would become of the workers since “we’re not allowed to call ICE. I don’t know where they’ll go.”
Baertschiger, while explaining why Josephine County is so poor, said the sheriff’s department used to be funded through timber receipts, then SRS (Secure Rural School) payments in lieu of those taxes “which have decreased dramatically because of Wyden and Merkley. (Note: While Senators Ron Wyden and Jeff Merkley support timber restrictions for environmental reasons, they are not against the timber industry and work to provide money to make up for losses in timber tax revenue.)
According to a Merkley 2021 press release “U.S. Sens. Ron Wyden and Jeff Merkley along with U.S. Reps. Peter DeFazio, Earl Blumenauer, Suzanne Bonamici and Kurt Schrader said today that 31 Oregon counties will receive about $39.3 million in Secure Rural Schools (SRS) payments for schools, roads, law enforcement and other essential services.”
When Meyer, who called Zoom meetings “fakes” asked Baertschiger when the board will resume meeting in person, Baertschiger said not until the mask mandate is lifted.
“When we have a public meeting we have no control and the public will come in not wearing masks and the Courier will take pictures and say we’re not enforcing mask mandates so to have no fights we’ll just do Zoom,” he said.