20130416 Late CorrespondenceCrrYOF
4~'
...-........O~RANCHO PALOS VERDES
TO:
FROM:
DATE:
SUBJECT:
HONORABLE MAYOR &CITY COUNCIL MEMBERS
CITY CLERK
APRIL 16,2013
ADDITIONS/REVISIONS AND AMENDMENTS TO
ADJOURNED REGULAR MEETING GROUNDBREAKING
CEREMONY SAN RAMON CANYON STORM DRAIN
PROJECT AGENDA **
Attached are revisions/additions and/or amendments to the agenda material presented
for tonight's meeting:
Item No.
1
Respectfully submitted,
~Cm~ie_
Carla Morreale
Description of Material
Email from Sunshine
W:\AGENDA\2013 Additions Revisions to agendaS20130416 additions revisions to agenda Groundbreaking Ceremony Agenda.doc
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SunshineRPV@aol.com
Tuesday,April 16,201310:11 AM
garyamo@aol.com
CC;Andy Winje;PlanningCommission;Ara Mihranian
Urgent trails issue.Skip dinner for the sake of restoring a trail or ten.
Urgent trails issue.Skip dinner,tonight,for the sake of restoring a trail or ten and support the Council's
decision to fund repairing our aging infrastructure.
Dear people who might care.
This is about how RPV is and is not implementing the PV Nature Preserve Public Use Master Plan (PUMP).
Show up to let the Council know that the PVP Land Conservancy is not the only voice to be heard.
San Ramon Canyon Ground Breaking Ceremony
APRIL 16,2013,5:00 P.M.
EAST OF THE LOWER SWITCHBACK ON PALOS VERDES DRIVE EAST NEAR SAN RAMON CANYON
This is all you get in the way of government "transparency".Scroll on down.
Following are two maps,the official City Council Agenda and my two cents worth in blue.
RANCHO PALOS VERDES CITY COUNCIL
ADJOURNED REGULAR MEETING/GROUNDBREAKING CEREMONY FOR THE SAN RAMON CANYON STORM
DRAIN PROJECT
APRIL 16,2013,5:00 P.M.
EAST OF THE LOWER SWITCHBACK ON PALOS VERDES DRIVE EAST NEAR SAN RAMON CANYON
5:00 P.M.REGULAR SESSION
CALL TO ORDER:
ROLL CALL:
APPROVAL OF AGENDA:
PUBLIC COMMENTS:(This section of the agenda is for audience comments for items NOT on the agenda.)
REGULAR NEW BUSINESS:
1.Groundbreaking Ceremony for San Ramon Canyon Storm Drain Project (Winje)Recommendation:Conduct the
ground breaking ceremony.
ADJOURNMENT:Adjourn to 6:00 P.M.at Fred Hesse Community Park in the Fireside Room for a Closed Session,to be
followed by a Study Session and Regular Council Meeting in the Multipurpose Room.
1
The Ceremony will be video taped but not broadcast live.Dress and behave accordingly.
The ceremony will be held in the RPV San Ramon Nature Reserve.I haven't seen any Environmental
Impact Report or Negative Declaration.
2
Private motor vehicle,pedestrian,equestrian and bicycle access is discouraged.Unlike what was in the
PV News,buses (not a car pool)will be provided leaving from the RPV City Hall parking lot near the
Community Room at 4:15 P.M.
Keep scrolling.
3
Since the
Council and Staff need to get to Hesse Park for their 6:00 p.m.closed session,I will use just one minute of the
Items not on the Agenda time to ask the Council to look around at the roadside pedestrian/bicycle trail which is
on both maps but does not exit,the off-road trail to Friendship Park which used to exist and consider how well
the Public Works Dept.and the Community Development Department have coordinated the goals of improving
the trails to 25 th Street,Friendship Park and the California Coastal Trail on the bluff top which will all be
impacted by the San Ramon Canyon Project....S
4
~:'.
A21 Saturda:y~Sunday,April 13 -14,2013 ******
THE WALL STREET JUURNAL.
Union-Employer Proposal Would Hit Some Retirees
By !{RIS MAHER
A coalition of unions and em-
ployers is proposing changes to
the federal law that governs the
pension plans of about 10 million
people,including reducing bene-
fits paid to retirees,the first
time in f01U·decades that such
cuts would be allowed.
The proposal,which would
undo guarantees put in place by
federal law in 1974,is already
stirring controversy among pen-
sion-rights advocates and rank-
and-file union lnelnhers.It was
developed by some of the na-
tion's biggest unions,including
the Teamsters and United Food
and Conlmercial Workers,and
industry trade groups such as
the Associated General Contrac-
tors of America.
Pension experts say a report
issued by the group earlier this
year will likely serve as the foun-
dation of a bill to replace rules
governing pensions that expire
in 2014.Sen.Tom Harkin (D.,
Iowa),chairlnan of the Senate
cOlnnlittee overseeing pension
policy,called the proposals,
which include cutting retiree
benefits,(Ca starting place."
UThe fact that labor and man-
agement were able to come to-
gether and agree on a compre-
hensive proposal to protect the
pensions of millions of middle-
class falnilies is a significant de-
velopment,"Mr.Harkin said.
The plan is the latest to ad-
dress a chunk of the nation's
creaky retirement infrastructure.
President Barack Obama's budget
proposal this past week could
also lead to a reduction in Social
Security benefits for retirees.
Something must be done to
shore up about 10%of the
roughly 1,450 multi-employer
pension plans in the U.S.,pen-
sion experts say.The plans,
funded by groups of employers
in construction,trucking and re-
tail food,and payout a Inonthly
check known as a defineabene-
fit,are the backbone of the re-
tirement security for 10.3 nlillion :
retirees and current workers.
More than half of such plans
are funded to at least 80%of
their liabilities.That is up from
one out of five plans at that level
in late 2008,after the stock mar-
ket tanked.But a minority is in
far worse shape.As many as 150
multi-employer plans are headeq
toward insolvency,according to
government projections.
For those troubled plans,
unions and employers are pro-
posing that the Employee Retire-
ment Income Security Act of
1974 be rewritten so that bene-
fits for people who are already
retired can be reduced.Without
that fix,advocates argue,the
plans will run out of money and
retirees will end up with a frac-
tion of their current benefits
when the government·takes over
the plans.
Advocates say early cuts can
stave off deeper ones down the
road.Under the proposal,trust-
ees from labor and management
would determine how deeply to
cut benefits to return the plans
to solvency.One labor official
said the cuts could take effect
within a year of the decision.
The cuts would depend on
each plan's finances and could
reduce benefits to as little of
110%of the level guaranteed by
the Pension Benefit Guaranty.
Corp.,the agency that backstops
private-sector pensions.The
110%level amounts to $12,870 a
year for peopl~who retire at age I
65 with 30 years of service.
''What we're really trying to
do is salvage the system,"said
Randy DeFrehn,executive direc-
tor of the National Coordinating
Committee for Multiemployer
Plans,a nonprofit group that as-
sembled the coalition.
The coalition is also propos-
ing a new form of pension plan
that would carry less risk for
employers than a defined-benefit
pension,but is designed to pro-
vide mor~security for retirees
than a 401(k).The assets are
pooled,rather than held in indi-
vidual accounts,reducing the in-
vestInent risk to retirees.
Mr.DeFrehn said cutting re-
tiree benefits is the controversial
proposal,but noted that lawmak-
ers have said they don't intend
to bail out the pension plans.
uThis is kind of a reverse bail-
out,"he said."It shifts a lot of li-
abilities away froni the public
sector and the taxpayer."
Retiree advocates are raising
red flags.Karen Ferguson,direc-
tor of Pension Rights Center,a
group that advocates for employ-
ees and retirees,said the union
and management interest in the
long-term survival of plans
might conflict with·.the interests
of older retirees who can't afford
to lose their income now.She
said Congress should consider
alternatives to the cuts.
Greg Smith,64 years old,a
Norton,Ohio,truck driver who
retired in 2011 after working 31
years,agrees.He now receives a
.monthly check for $3,019 froln a
Teamsters pension plan that is
projected to become insolvent in
2024.If that happens,the .PBGC
would take over and his benefit
could be cut to as low as $1,100.
Under the new proposal,his
benefits coUId be trimmed before
funds run out,giving the plan's
investments a chance to recover.
His benefits would be guaranteed
not to fall below $1,210 a month,.
110%of the PBGC level.
Ult's a precarious position for
a lot of us retirees,"Mr.Smith
said.''Let's come up with a plan
that doesn't trash the retirees
and put them in the poorhouse."
A spokeswoman for the Team-
sters,which participated in the
coalition,declined to conunent.
David Blitzstein,who oversees
multi-employer plans for United
Food and Commercial Workers,
said the lnajority of unions in the
coalition supported cutting re-
tiree benefits.The UFCW has
openly endorsed it.It has retir-
ees in about 60 Inulti-employer
plans,covering 1.4 million peo-
pie.He said cutting retiree bene·
fits could be the only way to saVE
about five deeply troubled plans.
and added that it wasn't cleal
how much benefits would haVE
to be cut.
Over time,numerous factors
have hurt the ability of plans to
fund benefits.Bankruptcies have
cut the number of employers
paying into some plans,eco-
nonnc downturns hurt invest-
ment returns,and some policy
decisions intended to strengthen
plans ended up weakening them.
Big and small companies now
say their future is threatened by
tmderfunded plans.The problem
is also holding down wages and
benefits for current workers in
industries like trucking.
Judy McReynolds,chief execu-
tive of Arkansas Best Corp.,is
alnong executives who back the
coalition's proposals.The com-
pany's ABF Freight System unit
participates in 25 multi-em-
ployer plans,and has 7,500
Teamster employees,two-thirds
of whom are enrolled in troubled
plans.She said half of ABF's an-
nual pension contributions of
$132 million are for people who
never worked for the company.
uThis is not sustainable,"she
said."It is imperative that we
find concrete solutions."
•W~at investors need to know
about proposed IRA Iimits.......B7
-.OPINION A-@@ l'l \dLo ,3
The Pension Rate-of-Return Fantasy
By Andy.Kessler
t has been said that an actuary
is someone who really wanted
to be an accountant but didn't
have the personality for it.See
who's laughing now.Things are
starting to 'get very interesting,
actuarially-speaking.
Federal bankruptcy judge Christopher
I<lein ruled on April 1 that Stoc~on,
Calif.,can file for bankruptcy via
Chapter 9 (Chapter l1's ugly cousin).
The ruling may start the actuarial
dominoes falling across the country,
because Stockton's predicament stems
from financial assumptions that are
hardly restricted to one improvident
California municipality.
Counting on 7.5%when
Treasury bonds are paying
1.74%?That's going to
cost taxpayers b~llions.
~~~~~{.~~m~i~
Stockton may expose the little-lmown
but biggest lie in global fmance:
pension funds'expected 'rate of return.
It turns out that the California Public
Employees'Retirement System,or
Calpers,is Stockton's largest creditor
and is owed some $900 million.But in
the likelihood that u.S.banlrruptcy law
trumps California pension law,Calpers
·might not ever be fully repaid..
.So what?Calpers has $255 billion in
assets to cover present and future
pension obligations for its 1.6 million
members.Yes,but ..:in March,
Calpers Chief Actuary Alan Milligan
published a report suggesting that
various state employee and school
pension funds are only 62%-68%
funded 10 years out and only 79%-86%
funded 30 years out.Mr.Milligan then
proposed-and Calpers approved-
raising state employer contributions to
the pension fund by 50%over the lhext
six years to return to full funding.That
is money these towns and school
systems don't really have.Even with
the fee raise,the goal of being fully
funded is wishful thinking.
Pension math is more art than
science'.Actuaries guess,er,compute
how much lnoney is needed today
based on life expectancies of retirees as'
well as the expected investment return
on the pension portfolio.Shortfalls,or
"underfunded pension liabilities,"need
to be made up by'employers or,in the
case of California,taxpayers.
.In June of 2012,Calpers lowered the
expected rate of return on its portfolio
to 7.5%from 7.75%.Mr.Milligan
suggested 7.25%.Calpers had last
dropped the rate in 2004,from 8.25%.
But even the 7.5%return is fiction.Wall
Street would laugh if the matter
weren't so serious.
And the trouble is not just in
California.Public-pension funds in
illinois use an average of 8.18%
expected returns.According to the
actuarial firm Millman,the 100 top U.S.
public companies with defmed benefit
pension assets of $1.3 trillion have an
average expected rate of.return of 7.5%.
Three of them are over 9%.(Since
2000,these assets have returned 5.6%.)
Who wouldn't want 7.5%-8%returns
these days?Ten-year u.s.Treasury
bonds are paying 1.74%.There is almost
zero probability that Calpers 'Will earn
7.5%on its $255 billion anytime soon.
The right number is probably 3%.
Fixed income has negative real rates
right now and will be a drag on
returns.The math is not this easy,but
in general,the expected return for
equities is the inflation rate plus
productivity improvements plus the
expansion of the price/earnings multi-
ple.For the past 30 years,an 8.5%
expe<;ted return was reasonable;given
+3%-4%inflation,+2%productivity,and
+3%multiple expansion as interest
rates plull11neted.But in our nevI
enviromnent,inflation is +2%,produc-
tivity is +2%and given that interest
rates are zero,multiple expansion
should be,and I'm being generous,-1%.
So what to do?I recall a conversa-
tion from 20 years ago.I was hoping to
get into the money-nlanagelnent busi-
ness at Morgan Stanley.I wanted to
ramp up its venture-capital investing in
Silicon Valley,but I was waved away.It
was explained to me that investors
wanted instead to put billions into
private equity.
One of the firm's big clients,General
Motors,had a huge problem.Its
pension shortfall rose from $14 billion
in 1992 to $22.4 billion in 1993.The
company had to put up assets.Instead,
Morgan Stanley suggested that it only
had an actuarial problem.Pension
money invested for an 8%return,the
going expected rate at the time,would
grow 10 times over the next 30 years.
But money invested in ualternative
assets"like private equity (and venture
capital)would see expected returns of
14%-16%.At 16%,capital would grow 85
times over 30 years.Woo-hoo:problenl
solved.With the stroke of a pen and no
n~w money from corporate,the GM
pension could be fully funded-actuari-
ally anyway.
Things didn't go as planned.The
.fimd put up $170 million in equity and
borrowed another $505 million and
invested in-I'm not kidding-a
northern Missouri farm raising geneti-
cally engineered pigs.Meatier pork
chops for all!Everything went wrong.
In May 1996,the pigs defaulted on $412
million in junk debt.In a perhaps
related event,General Motors entered
2012 with its global pension plans
underfunded by $25.4 billion.
In other words,you can't wish this
stuff away.Over time,returns are going
to be subpar and the conbibutions
demanded from cities across California
and companies across America are
going to go up and more dominoes are
going to fall.San Bernardino and seven
other California cities may also be
headed tQ Chapter 9.The·more Chapter
9 filings,the less money Calpers
receives,and the more strain on the
fictional expected rate of return until
the boiler bursts.
In the long run,defined-contribution
plans that most corporations have
em1:)raced will also be adopted by local
and state governments.Meanwhile,
though,all the knobs and levers that
can be.pulled to delay Armageddon
have already been used.California,
through Prop 30,has tapped the top
1%of taxpayers.State employers are
facing 50%contribution increases.
Private equity has shuffled all the
mattress and rental-car companies it
can.Buying out Dell is the most
exciting thing they can come up with.
Expected rates of return on pension
portfolios are going down,not up.
Even Facebook millionaires won't
make up the shortfall.
II)Sadly,the only thing left is to cut
~retiree payouts,something Judge Klein
~has left open.There are 12,338 retired
$California government workers
receiving $100,000 or more in pension
payments from Calpers.Michael D.
Johnson,a retiree from the County of
Solano,pulls in $30,920.24 per month.
As more municipalities fue Chapter 9,
the more these kinds of retirement
deals will be broken.·When Wisconsin
public employees protested the state
government's move to rein in pensions
in 2011,the demonstrations got ugly-
but that was just a hint of the torches
and pitchforks likely to come.
Meanwhile,it's business as usual.
California Gov.Jerry Brown released a
state budget suggesting a $29 million
surplus for the fiscal year ending June
2013 and $1 billion in the next fiscal
year.Actuarially anyway.
Or as Utah Rep.JasonChaffetz told
Vermont Gov.Peter Shumlin,upon
learning at a 2011 House hearing about
that state's unrealistic pension
assumptions:''If someone told me they
expected to get an 8%to 8.5%return,
I'd say they were probably smoking
those maple leaves."
Mr.Kessle~a fornler hedge-fund
manager,is the author most recently
of '~at People"(P011folio,2011).
CITY OF -~o RANCHO PALOS VERDES
TO:
FROM:
DATE:
SUBJECT:
HONORABLE MAYOR &CITY COUNCIL MEMBERS
CITY CLERK
APRIL 16,2013
ADDITIONS/REVISIONS AND AMENDMENTS TO
AGENDA**
Attached are revisions/additions and/or amendments to the agenda material presented
for tonigtit's meeting:
Item No.
SS2 a
1
Respectfully submitted,
Carla Morreale
Description of Material
Email from Lynn Swank
Email from Donald M.Davis
W:\AGENDA\2013 Additions Revisions to agendaS20130416 additions revisions to agenda.doc
From:
Sent:
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Cc:
Subject:
Council Members:
Swank Lynn <Iynn.swank@cox.net>
Monday,April 15,2013 10:40 PM
CC
Carla Morreale;Carolyn Lehr
Study Session 4/16:Naming Policy
As I was reviewing the agenda for the April 16,2013 City Council meeting I glanced at the special study
session items to be discussed and was surprised to note that the Council may take action on Item #SSA2.
1.I do not believe the City Council should take any vote during a study session that results in the change of
something that impacts all residents,regardless of the subject matter.The city council meeting is the proper
forum to make these decisions.Resident input,council discussion and how and why the council makes a
decision impacts all of us and ensures transparency of the decision making process.
Recommendation:All decisions that impact the city should be placed on the City Council agenda for all
residents to review.
2.I am concerned with the broader and long-term implications of the naming policy.Rancho Palos Verdes is
40 years old this year and will continue to exist for many years to come.Our city has a finite number of rooms,
buildings,parks,etc.that could eventually all be named after someone,regardless of what this council considers
a "rare event".A future city council will need to decide how to handle the lack of available places to name.In
the future,they could be renamed or changed to make room for a new honoree.A decision to honor a resident
in the manner recommended deserves to be heard by all --there are many individuals and groups that could be
honored and they should also be considered now or in the future.
Recommendation:As the city council recognized a couple ofyears ago,a medium such as the honor wall that
honors individuals and groups is a solution that I urge you to explore further.Perhaps now is the time to
establish a new policy so it is clear to all residents and groups that there will be a place to honor all
contributors to the City ofRancho Palos Verdes.
Lynn Swank
RPV Resident
1
From:
Sent:
To:
Cc:
Subject:
Davis,Donald M.<DDavis@bwslaw.com>
Tuesday,April 16,2013 8:44 AM
CC;Joel Rojas;Ara Mihranian;Carol Lynch <clynch@rwglaw.com>
'Michael Brophy';Jim Reeves
Marymount California University:Selection of Rincon Consultants,Inc.to Prepare the CEQA
Documentation for the Revised Athletic Field Plans
Dear Mayor Brooks and City Councilmembers,
Due to schedule conflicts,Marymount California University will not have a representative in attendance at the meeting
tonight when the referenced item comes before the City Council.
Marymount supports the staff recommendation for the City to retain Rincon Consultants,Inc.to prepare the CEQA
documentation for Marymount's proposed revisions to the City approved athletic field plans.Rincon is a well-respected
firm,and,as noted in the staff report,has considerable experience in preparing CEQA documentation for municipal and
institutional recreational projects.Rincon's proposal reflects a solid understanding of the scope of work,and,as the party
responsible for pay'ing for the consultant,Marymount believes that the cost estimates are both realistic and considerably
more reasonable given the nature of the changes to the approved plans.
We note that Rincon has prepared CEQA documentation on an accelerated schedule for recreational facilities far larger
than the single athletic field to be relocated on the University's campus and would request that staff be directed to work
with Rincon in a similar expedited manner so that the revised plans can be considered by the City Council at the earliest
opportunity.
Sincerely,
Donald M.Davis
Partner
BUHKE 1 WILUAivlS &SOHENSEN:L.LP
444 South Flower Street
Suite 2400
l~os L'.,..r:.C>,.:.c,c
21
213··-236··-2700 fax
2 ~13~236 ..2702 direct
ddavis@bwslaw.com
www.bwslaw.com
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