Tuesday, May 19, 2015

COIN Ordinance for Torrance, CA

Costa Mesa, California and the entire Orange County governing Board of Supervisors implemented this transparency and labor reform a few years ago The Civic Openness in Negotiations ordinance.

Otherwise known as COIN, this charter amendment requires more transparency between city councils and their constituents before voting on labor contracts, many of which have contributed to rising pension, benefits, and other liability costs now bankrupting cities or hurting their long-term financial stability.

State Senator John Moorlach
Flash Report offered the following points on why the COIN ordinance was needed, according to Orange County supervisor (now state senator) John Moorlach:

Eight years ago, then Orange County Register reporter Norberto Santana opened his piece, “The Art of the O.C. Deal (Orange County Register, August 6, 2006),” with the following observation: “When people see the board of supervisors vote on a labor deal, what they don’t know is that most often, an agreement has already been reached in private. And it’s perfectly legal.”

City leaders voting for a deal based on private agreements made public: does any of this sit well with local leaders or taxpayers? Elected officials rule in the public interest, yet private or special benefits get voted on in this practice. Torrance residents have complained to me about their frustration with city leadership making decisions behind closed doors, and how they arrive at those decisions, only to present an array of choices publicly, even when the final vote has been tallied and ready before the  meeting.

Moorlach echoed this frustration in his article:

Can you imagine a private sector business allowing a third-party to negotiate contracts on its behalf with no say in the process? Of course not. Yet, when dealing with labor negotiations, the general public, whose tax money is being spent, allows their elected officials to negotiate without any real say in the process.

Reform governors like Scott Walker of Wisconsin and Rick Snyder of Michigan recognized this conflict of interest, where labor unions and elected official struck lavish, generous deals for employees, at the expense of the very people paying the bills: the taxpayers. Of course no one would approve a deal they have to pay for without their input.

Yet this outcome occurs frequently in public sector labor negotiations all the time.

Moorlach then introduced and outlined the COIN ordinance:

These negotiations, which happen behind closed doors, are shrouded in secrecy, with the general public only being able to give input after a deal is already agreed upon.

For this reason, I have introduced the Civic Openness in Negotiations (COIN) ordinance for consideration by the Orange County Board of Supervisors at its June 17, 2014, meeting.

Independent Negotiator – As is current policy, the County will hire an independent negotiator that is not impacted by any outcome in the negotiation process. Past practice had county staff, who were subject to the same provisions as the bargaining unit they were negotiating with, negotiate on behalf of the Board of Supervisors. Independent negotiators remove this conflict.

Finally, real independence in contractual negotiations. Everyone should approve this provision, whether a member of a labor union, a city official, or a resident.

Cost of Contracts – Current practice has the county budget office analyze the costs of any contract proposal. Under COIN, the independently elected Auditor-Controller will take on this responsibility. This ensures an equal playing ground for both labor organizations and the county as both will be given the ability to comment about the analysis.

Offers and Counteroffers – This ordinance would require that all offers and counteroffers be disclosed to the public within 24 hours.

Disclosure is a good thing, especially for the party paying the fees and furnishing the funds for

Board Disclosure – Each member of the Board of Supervisors will be required to disclose any and all verbal, written, or electronic communications they have had with an official representative of a recognized employee organization.

This measure would be modified so that every member of the city council or school board would be required to reveal their contact information.
Contract Approval – This ordinance will require that, before the final proposed contract is placed on the Board agenda, the Memorandum of Understanding will be posted to the County website.

A memorandum of understanding is:

 a bilateral or multilateral agreement between two or more parties. It expresses a convergence of will between the parties, indicating an intended common line of action. It is often used in cases where parties either do not imply a legal commitment or in situations where the parties cannot create a legally enforceable agreement.

The key word is "intended", but the agreement would not be realized until final approval by the city governing board, whether city or school board or other agency.

Why are all these steps necessary in labor negotiations? Accountability is crucial, as well as providing time and resources for individual residents to review the upcoming contracts and ensure that city funds are properly allocated, with considerations for the future as well as present fiscal needs in place.

Last year, the Torrance City Council approved retroactive pay increases for one municipal employees union, and without any lengthy transparency or responses from voters.

Some of the remarks from the article were telling:

Details of the proposed deal won't be publicly available until the day of the meeting, creating some suspicion of a behind-the-scenes pact.

A COIN ordinance would prevent this appearance (or reality) of impropriety, especially on the part of a relatively new and inexperience city council.

On a more general note, why does any city continue entering into expensive labor agreements, even while businesses struggle in the Balanced City, or leave altogether. Working families are tightening their belts, controlling their spending habits. City governments should be expected to do  the same.

A month before the June 2014 elections, Torrance labor unions even complained and picketed after the city offered an 8.1% salary increase. The prior mayor offered the same increase to every union, contingent on allowing the city to choose insurance providers. These are reasonable requests, but one of the unions still pushed back. When will city residents shout back: "Enough!"?

In the Costa Mesa Daily Pilot, Costa Mesa Charter Committee member Gene Hutchins reported the following benefits of the COIN ordinance in their city:

At the last Costa Mesa City Council meeting, I was pleased to see savings of more than $1 million result from negotiations with employees. The transparency of COIN confirmed this success.

COIN, the Civic Openness in Negotiations ordinance, requires public disclosure of traditionally closed labor negotiations between the city and its public employee unions. COIN allows the public to see and comment on formal proposals before the council votes on them.

Had COIN been in place from 2000 to 2010, residents would have learned that the city's three public employee unions were pushing through major increases in employee pensions. Pensions were increased as much as 50%, and increases were "retroactively applied" to each employee's hire date.

These massive increases in public entitlement spending had gone unnoticed for years, but because of COIN, residents could question and block these increases, and force their representatives to renegotiate in the best interests not of special interests, but the public interest.

Now is a good time for municipalities like Torrance to push for transparency and greater input from residents in all city labor negotiations. Instead of relying on cuts and tax increases, reforms like COIN could invest cost-saving measures and improve community-council relations.

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