Fresno Bee Newsroom Blog

Some thoughts on Measure G issues

Several thoughts on issues surrounding Measure G:

1.) Public Utilities Director Patrick Wiemiller says he plans to ask the City Council in late July for the OK to begin a hearing process on residential trash rates. That means rates could go down, stay the same, go up. The typical customer now pays $25.37 a month.

2.) Four services go into a homeowner’s monthly utility bill: Water ($24.49 for one-inch meter and 1,800 cubic feet of water); sewer ($25.75); trash ($25.37); and community sanitation (neighborhood cleanup, street-sweeping, etc., $6.23). This produces a typical monthly bill of $81.84.

3.) Wiemiller will go the City Council on Thursday, June 27 for the OK to begin the hearing process on water rates. Public Utilities seeks a $410 million upgrade to the city’s water system. Based on a staff report, the proposed increases would double the typical homeowner’s monthly water bill in three years — $24.49 today to $48.34 as of July 2016 (the start of the 2016-2017 fiscal year).

4.) The same staff report recommends no change to sewer and community sanitation rates over the next four fiscal years (FY 2013-2014, which begins in less than a week, to FY 2016-2017).

5.) The staff report’s question mark is home trash (called “residential solid waste,” in utilities lingo). Rates for the next four fiscal years are “to be determined,” the staff report says. The staff report adds in a footnote: “Based on two independent rate analyses, it appears that a rate increase(s) is warranted.”

6.) Measure G — the home trash-outsourcing ordinance — was rejected by voters in the June 4 special election. The final tally: “No” had 29,901 vote, “yes” had 29,039 votes. A total of 58,940 valid ballots were cast. “No” got 50.73% of them, “yes” got 49.27%. Fresno for this election had 194 precincts and 217,627 registered voters.

7.) Measure G was unlike anything in Fresno’s history as a sovereign municipal government. Measure G’s source of authority wasn’t the city charter. Fresno’s municipal government in the exercise of its charter authority actually embraced outsourcing — the ordinance passed on a 4-3 council vote, then was signed by Mayor Ashley Swearengin. That’s when the three council members on the losing side — Blong Xiong, Oliver Baines, Sal Quintero — led a successful petition drive to put the issue (outsourcing, yes or no?) on the ballot of a special election. The authority for doing so is state election law. This was the first time in Fresno’s 128-year history that some of the city’s elected officials sought to de-legitimize, however briefly and narrowly, the authority of the city charter that they had taken an oath to uphold and protect.

8.) That’s why the Measure G election was much more than a popularity contest. Xiong, Baines and Quintero asked voters to be policy-makers. Voters were to be policy-makers not through the government of representative democracy as outlined in the city charter. Voters were to be policy-makers through direct democracy. The voters’ decision would be final. The voters’ decision would be city policy until voters said otherwise.

9.) The challenge for voters is that they had two policies to choose from. Both were complex. The Swearengin policy in a nutshell was this: A 17.6% rate cut for the first 22 months of a nearly nine-year contract with Mid Valley Disposal; capped rate hikes so that consumers wouldn’t pay $25.37 a month until 2020; and millions in annual franchise fees needed to prevent a financial meltdown. If Measure G failed, Swearengin said, the city may have to pursue a declaration of fiscal emergency.

10.) The voters rejected this policy. Swearengin on Wednesday signed the 2013-2014 budget. There has been no hint of the need for a declaration of fiscal emergency. In fact, city officials are hopeful of a recovering local economy. Better times may be just around the corner.

11.) The anti-outsourcing policy of Xiong, Baines, Quintero and their supporters also had a handful of key points. The sale of the city’s trash trucks and garbage bins to Mid Valley for about $10 million was a $50 million gift of public assets. A corrupt City Council is sure to unfairly boost rates once the Mid Valley deal becomes law, betraying 105,000 ratepayers. The trash division’s big reserve would be misspent to make Mid Valley happy. The city’s 100 trash-truck drivers and their 50 support workers who would move to Mid Valley jobs would see a dramatic drop in their wages and standard of living. The city’s home trash service isn’t broken, so there’s no need to “fix” it. A for-profit company such as Mid Valley is bad for Fresno’s home trash customers.

12.) The voters on June 4 made this the policy of City Hall. Xiong, Baines, Quintero and their supporters won through the state election code what they couldn’t win through the city charter. The people’s will is sacred.

13.) How is the Xiong-Baines-Quintero policy to become reality? We’ll begin to find out in late July when Wiemiller gets the ball rolling on an in-depth review of the city-run solid waste division. After all, that’s what a rate study does in an enterprise department such as solid waste. Such a department charges ratepayers only what it needs to cover all its expenses. The key question: What are those expenses?

14.) The Measure G campaign and the recent Public Utilities budget hearing gives a hint of the challenges ahead.

15.) Outsourcing opponents in the Measure G campaign told voters that Mid Valley was stealing public assets by paying about $63,000 each for the city’s 85 to 90 trash trucks rather than the $250,000 that a new truck costs. Wiemiller this month told the council that much of the trash-truck fleet is aging. Public Utilities may have to buy 25 to 35 new trucks, he said. The two questions: Can Wiemiller find someone willing to pay $250,000 each for 10- to 12-year-old trash trucks being phased out of use, thereby avoiding accusations from the dais that he’s making a gift of public assets? If Wiemiller can’t, will the council insist that the solid waste division continue using the aging trucks until such buyers can be found?

16.) Wiemiller told the council during the Public Utilities budget hearing that the solid waste division’s reserve has about $1 million or $2 million in it. Wiemiller and the council, while waiting for that buyer to step forward who’s willing to pay for an old trash truck the same price that a new trash truck would cost, will have to decide where to get the $6 million to $9 million needed to buy up to three dozen new trash trucks.

17.) This same political and financial model works for the aging trash bins. A new bin costs $89.99 at one of the mega-hardware stores in River Park. Mid Valley was going to pay $10 each for the city’s 300,000-plus bins. In the wake of the failed Measure G, city officials must figure out where to find someone willing to pay $89.99 each for aging trash bins so they won’t be charged from the dais with giving away public assets.

18.) There’s another reserve in the solid waste division. This one has $15 million to $20 million in it. Most of this money came from a lawsuit settlement with Fresno County. The city’s Utility Advisory Committee in 2010 recommended using this money to backfill several years of rate cuts. The council must decide whether it wants to protect this reserve (as the voters said when rejecting outsourcing) or whether it wants to use this reserve for new trucks and trash bins, or whether it wants to use it for rate-cuts (spending down the reserve and leaving ratepayers’ wallets as the ultimate reserve).

19.) The trash-truck drivers make a decent middle-class living. According to city records, the top-paid trash-truck driver in 2012 made more than four of the Fresno’s full-time firefighters (individually, not combined). The union contract for the trash-truck drivers and some of their support staff expired a year ago. These workers didn’t get a raise last year. The council has taken the unusual step of negotiating directly with the police union on contract matters. The council in the wake of the voters’ will as expressed in Measure G must decide whether to assume responsibility for negotiating a new contract with the drivers that ensures they receive fair compensation. The money for a new rate of compensation will come from the same people who defeated Measure G.

20.) The city of Fresno retirement systems (one for public safety employees, the other for non-public safety employees) have adjusted the assumed rate of return on their pension investments. The assumed rate has gone from 8% to 7.5%. This almost certainly will mean higher contributions from the city to keep the systems fully funded. This extra money, should it become necessary in the solid waste division, will come from ratepayers. After all, it’s an enterprise system that charges customers only what it needs to cover expenses in an operation that doesn’t pursue profits. The City of Fresno retirement systems’ challenge is the free market system that includes Mid Valley Disposal. The retirement systems (and the city’s employees/retirees) depend on investments in for-profit companies. After all, no pension will cover its bills investing every dime in U.S. of A. bonds. The City of Fresno retirement systems (and the city’s employees/retirees) prefer to quietly invest in companies making money like 19th century robber barons. If there aren’t enough of these cut-throat companies out there, or these companies can’t make the necessary profits in a 21st century world where profit (at least publicly) is a dirty word, then the retirement systems (and the city’s employees/retirees) turn to the only one source to fill the gap. We’re talking taxpayers/ratepayers.

21.) In the old days, City Hall would have turned all this complexity to a utility advisory committee (or commission). Such a committee spends months and months coming up with a list of recommendations covering five years. The recommendations consist of maximum annual rate hikes (or cuts) for sewer, water, trash and community sanitation. The report from the most recent utility advisory committee is more than three years old and was never acted upon by the council. City officials say this report is no longer up-to-date (if it ever was). City officials also say the utilities’ rate structures can’t wait six or nine months for another utility advisory committee to be appointed and do its duty. In the end, the council, not the committee, determines utility rates.

22.) So, the city’s residential solid waste division may not be broken, but it’s headed for a lot of inspection — and possible change. The council will make any changes, based on the will of the people as expressed in the Measure G vote.

23.) On Thursday, June 27, the City Council as part of its consent calendar will go through the formality of passing a resolution making the result of Measure G official. The staff report includes 26 pages of statistics on each of Measure G’s 194 precincts. I went to the office of Fresno County Registrar of Voters Brandi Forth on Wednesday and bought ($15) a large map of the 194 precincts. What follows are a few tidbits from the staff report and Orth’s map.

24.) About a dozen precincts were mail-in voters only. Of the city’s 217,627 registered voters, 27.1% cast ballots. Thirty-eight of the 58,979 ballots were blank and one was what’s called “over-voted.” There was only one yes-or-no question on the ballot, so I guess someone voted both yes and no. More than two-thirds of the ballots were mail-in.

25.) Only 57 of 1,266 voters in Precinct 169 cast ballots. There were 43 absentees and 14 people who went to the polls. Precinct 169 is the Fresno State area, including the apartments along Bulldog Lane plus sorority/fraternity row. Not many single-family homes there. At the same time, Measure G was a politically-charged two-month campaign with charges of “justice for the people” shouted on both sides. I guess today’s Fresno State’s students don’t have that ‘60s passion. “No” got 34 votes, “yes” 23.

26.) Fifty-four precincts with both mail-in and poll-booth voting had at least 30% turnout. Twenty-three precincts had at least 40% turnout. Five precincts had at least 50% turnout.

27.) The five precincts with at least 50% turnout were No. 38 (50.18%), No. 130 (54.94%), No. 131 (52.85%), No. 135 (53.10%) and No. 138 (54.25%).

28.) Precinct No. 38 is the Fresno High-Fresno City College area near the Tower District — east of Palm and north of McKinley. A lot of grand homes in there that once belonged to professors when Fresno State College was located in the neighborhood. Precinct 38 has 544 total registered voters, rather small compared to other precincts. “No” had 169 votes, “yes” 104.

29.) Precinct No. 130 is in the Fig Garden Golf Club area in northwest Fresno. There were 857 ballots cast out of 1,560 registered voters. “Yes” had 730 votes (85.18%), “no” 127 (14.82%).

30.) Precinct No. 131 is due south of No. 130. No. 131 had 1,047 ballots cast out of 1,981 registered voters. “Yes” had 758 votes (72.4%), “no” 289 (27.6%).

31.) Precinct No. 135 in the Escalon/Valentine/Palo Alto area of northwest Fresno. It had 480 ballots cast out of 904 registered voters. “Yes” had 328 votes (68.33%), “no” 152 (31.67%).

32.) Precinct No. 138 extends for about a mile north of Shaw Avenue, with Forkner on the west and West Avenue on the east. It had 690 ballots out of 1,272 registered voters. “Yes” had 476 votes (68.99%), “no” had 214 (31.01%).

33.) Five precincts with both absentee and poll-booth voting had less than 10% turnout: No. 74 (8.81%), No. 76 (9.38%), No. 77 (9.44%), No. 147 (9.81%) and No. 169 (4.50%).

34.) As noted above, No. 169 is the Fresno State area. No. 147 is Pinedale. The other three all have Belmont Avenue as one of their borders. These five precincts cast a total of 423 votes. The “no” side prevailed a better than 2-to-1 margin.

35.) I counted 182 precincts with both absentee voting and poll-booth voting. The “no” side had more than half the votes in 127 precincts. The “yes” side had a majority in 55.

36.) The vote was closest in Precinct No. 1, in the far tip of northwest Fresno where Highway 99 comes into town. The vote was “yes” with 202 votes, “no” with 200. The biggest margin by percentage was Precinct No. 55 in west Fresno. The vote was “no” with 150 votes (91.46%), “yes” with 14 (8.54%).

37.) The “no” side did a superb job of getting out the vote on election day. For example, in Precinct 73 (Belmont and Cedar area) the “no” side had 94 votes via absentee ballot (64.38%) compared to “yes” with 52 (35.62%). But Precinct 73 voters going to the polls on June 4 cast 41 votes for “no” (89.13%) compared to 5 for “yes” (10.87%). Precinct 91 (in southeast Fresno, south of Butler) was fairly close among absentee voters. There were 154 “no” votes (53.1%) compared to 136 “yes” (46.9%). Precinct 91 voters going to the polls on June 4 cast 96 “no” votes (73.28%) to 35 “yes” (26.72%).

38.) Before the polls closed on June 4, outsourcing opponents said they liked their chances if they were close after the mail-in ballots were counted. They said they had confidence in their get-out-the-vote effort on election day. They were right.


JO says:

Fresno has always had some of the lowest water rates in the state – we have been lucky and spoiled for a long time. Looks like Fresno’s water rates are about to take a step towards catching up with those of the rest of the California and reality.

Tobie says:

A bat living upside down in a cave could have provided a more accurate observation of what happen leading up to Measure G and after than Mr. Hostetter’s blog, “Several thoughts on issues surrounding Measure G.” This blog is written as if it’s fact and not opinion.

The Bee Editors should label this Blog as pure opinion by the author.

It seems to be the reoccurring theme by the author that Measure G was only about a power play with the Mayor & 4 City Council members on the “yes” side and 3 City Council members on the “no” side. He seems to want to ignore and it’s a slap in the face to whole bunch community members representing a huge and deserve cross section of this town that came together to put a halt to what was about to become one of the biggest mistakes this city has ever made. Yes, that’s my opinion.

The City Charter allows for the city to grant franchises to firms to provide city services in order not only to have the service provided, but to maintain some control over that specific service delivery. But what it does not allow, nor does state law, is for these franchisee’s to be gouged as a profit making cash cow for the city.

It’s one thing to have many different firms competing with each other, all have been granted a franchise by the city to provide the same service, i.e. cab companies, rental car companies and the like where we all can pick and choose if we want to use these services or not.

Compare that with a single franchisee that has been granted to operate as an exclusive one contractor monopoly for trash hauling that everyone is mandated to use as a requirement to have a home in this city. Additionally, couple that with the city demanding the hauler kick-back a big percentage of the bill paid by each homeowner to the city’s general fund and you have the proscription for run-amok rate increases as the city leaders get a taste of more and increased revenue into the general fund as the trash rates increase.

I’m sorry but that’s just nuts and yes that’s my opinion. Thank you Fresno voters for turning down Measure G, and that’s not opinion that’s an undisputed fact!

Nettie Ree says:

They are needing to fix the downtown water system. It’s the oldest in town. It won’t support all the development Ashley is pushing. They are even talking about building another water tower next to the existing one near the old Kerr Rug building. Sounds like business as usual – let’s push something and then find out if it will work.

JO says:

Actually it will not be a water tower; it will be a relatively modest 3million gallon water tank. In comparison, they are proposing an 80 million gallon water storage facility for southeast Fresno. The water system downtown is totally antiquated (think in 100 year terms), and no longer can accommodate much more development. It is totally reasonable that downtown just like other parts in Fresno should have a modern water system.

Joe Bruin says:

Item number 20 is a complete misrepresentation of the city’s retirement system. Mr. Hostetter is confusing the pension system with the drop system. The assumed rate of return is not 7.5% for the pension system, that’s the rate of return on a drop account, which is a 401k type investment. It has a variable rate of 7.5% currently. The city’s pension system today is about 85% funded, one of the highest in the state (as noted by the Fresno Bee) and when it was over 100% funded a few years back the city contributed nothing to the pension fund while the employees continued making their own contributions. He also ignores the important fact that the city does not pay into Social Security which is 6.2% of the employees income. The employees would pay 6.2% and the employer would pay 6.2%. This criticism deals with just a single paragraph of Hostetter’s blog.

Knzea thompson says:

I like the fact George that your point #19 makes it appear that the top paid trash driver made more than 4 of the lowest piad fireman combined, perhaps you could clarify? I told you long ago that money would magically appear if g failed and all predictions of doom and gloom were nothing more than idealogically driven fear tactics and they have been proven to be

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