State agencies gave their employees nearly 200,000 hours of unearned leave credits worth almost $6.4 million over five years, and the self-inflicted taxpayer expense will only grow until the government fixes the errors, according to a new state audit.
Accounting mistakes, misinterpretations of labor contract requirements and a lack of accounting controls at state agencies and the California State University are to blame, State Auditor Elaine Howle said in the report. Meanwhile, it’s likely that some overpayments to departed employees can’t be recouped, she said, because the recovery law is vague.
Most departments highlighted in the audit agreed to fix their leave-accounting systems. State Controller John Chiang’s office, which collects the leave data that auditors analyzed, embraced some fixes but said others were unworkable or redundant and questioned the audit methodology.
Chiang’s acting chief administrative officer Tom Yowell also said in a response to the audit that the number of problems is so small compared to the billions of dollars in leave credits tracked that Howle’s audit “suggests that the leave accounting process is operating at over 99.99% accuracy.”
Brian Nguyen/ The Sacramento Bee
The Board of Equalization with scaffolding around its base to protect pedestrians from falling exterior glass panels.
Legislation to move the state Board of Equalization’s operations from its troubled high-rise headquarters – at an estimated cost of $500 million – has been remodeled to conform to Gov. Jerry Brown’s more modest plan to assess how the state uses and maintains its buildings.
The measure revamped on Friday by Assemblyman Roger Dickinson, D-Sacramento, starts with $2.5 million for the Department of General Services to develop a long-range plan for state buildings in the Sacramento region, including their best use and repair and maintenance needs. Assembly Bill 1656 would enshrine in statute the Brown administration‘s plan to review all of the 34 state-controlled and -owned office buildings in Sacramento County and West Sacramento, said David Gonsalves, Dickinson’s chief of staff.
The measure sets a July 1, 2015 deadline for the assessment, then requires that the state seek proposals “for the planning, design, construction, and acquisition of facilities” to replace the three buildings in the worst shape.
“We expect the (Board of Equalization) building to be in the top three,” Gonsalves said.
Asa Mathat/ Department of Fair Employment and Housing
Department of Fair Employment and Housing Director Phyllis Cheng
After months of withering criticism, the California Department of Fair Employment and Housing has ended a policy blamed for chilling state-employee discrimination claims.
Department Director Phyllis Cheng on Thursday made the announcement in a conference call with department consultants who are on the front lines of the agency’s mission to investigate housing, workplace and disability discrimination allegations.
During that same call, spokeswoman Fahizah Alim confirmed, Cheng told staff that the department would, on Sept. 1, begin interviewing claimants at the start of the filing process. As first reported by The Sacramento Bee, Fair Employment switched to an online English-only computer system two years ago that required claimants – who may not speak English or have any knowledge of discrimination law – to build the case for their claims.
The HoudiniEsq program sometimes produced nonsensical allegations that the automated system would simply push on to employers or property managers accused of discrimination.
Jose Luis Villegas/ The Sacramento Bee
Some state computers are blocking emailed contract ratification ballots to state attorneys, their union said Thursday.
California Attorneys, Administrative Law Judges and Hearing Officers in State Employment, or CASE, informed its members of the problem and the union’s board announced it would extend the voting period by one week to 11:59 p.m. on August 28.
“(I)t appears that the firewalls and/or spam filters of some State departments are blocking e-mail messages originating from Votenet (email@example.com) that contain the tentative agreement ratification ballot,” the union’s board said in an e-mail to members.
The glitch between the union’s system and state computers briefly delays a vote count on a contract bargained more than a year after the union’s last pact expired. Since then, the 4,000-or-so employees that CASE represents have been working under the terms of the expired contract, without the raises and higher employer health insurance contributions afforded other employees whose unions took agreements last year.
Renee C. Byer/ The Sacramento Bee
An official stands near the composite solution cooling towers at the state's Central Heating and Cooling Plant in Sacramento. Operating engineers work at the plant.
After months of contentious talks, one rejected contract offer and a strike threat, negotiators representing 850 state operating engineers reached another tentative labor agreement with Gov. Jerry Brown late Thursday.
The International Union of Operating Engineers Local 39 was the last state employee union without at least a tentative contract in place for the Legislature to consider before the curent session ends Aug. 31. Two unions representing state scientists and attorneys came to tentative terms with the administration last week. The remaining nine state-worker unions have contracts in place.
Members of the last three unions, which were all holding out for more pay, will have to approve the agreements for them to take effect.
Brown’s agreement with the operating engineers, who run heating, cooling, water and other complex systems for state facilities, is similar to the offer the rank-and-file rejected in June: a 2 percent raise retroactive to July 1 and a 2.5 percent increase on July 1, 2015. The contract expires a year later.
California’s largest state employee union is spending $180,000 on radio and online ads to support CalPERS board candidate Theresa Taylor, according to a state filing Thursday. The Franchise Tax Board employee is one of three candidates running for the state member seat on the 13-member board.
The independent expenditure by SEIU Local 1000 comes two days after the union contributed $200,000 to the committee created last week to support Taylor’s candidacy. The spending dwarfs her opponents’ backing.
The campaign of David Miller, an environmental scientist at the Department of Toxic Substances Control, recently received $4,100 from the Retired Public Employees Association, but has no other reported funding and no independent committee support.
Iqbal S. Badwalz, a Department of Education consultant also vying for the state member seat, has no reported campaign cash and no reported committee support.
It’s test time for California’s 3,000 state government scientists.
Last week, the five-member bargaining team for the California Association of Professional Scientists reached a tentative agreement with Gov. Jerry Brown. It gives the union’s members a $1,000 bonus if they ratify the contract and 3 percent raise next July 1, when the deal expires.
Then on Wednesday the Brown administration signed orders for 570 scientist supervisors and managers to receive pay raises of up to 42 percent, a cost of $24.4 million for this year alone.
(About 3,500 state engineering supervisors get an 8 percent raise under the terms of the same administrative order. Total first-year cost: $32 million.)
Jay Mather/ The Sacramento Bee
CalPERS headquarters in Sacramento.
A divided CalPERS board approved a regulation Wednesday that will allow nearly 100 different types of supplemental pay to count toward pension calculations for state and local government employees.
The 7-5 vote drew a swift rebuke from Gov. Jerry Brown, who signed pension overhaul legislation in 2012 that, in part, attempted to crack down on pension spiking. Specifically, Brown objected to CalPERS’ allowing pension calculations to include “temporary upgrade pay” for workers who briefly fill a higher-paying position to count toward retirement.
“Today CalPERS got it wrong,” Brown said in a statement released shortly after the board’s action. “This vote undermines the pension reforms enacted just two years ago. I’ve asked my staff to determine what actions can be taken to protect the integrity of the Public Employees’ Pension Reform Act.”
That law required pension calculations based on “the normal monthly rate of pay or base pay” of employees who become retirement system members on Jan. 1, 2013, and later. It also disallowed “ad hoc” payments included in retirement benefit calculations, a key provision intended to thwart pension spiking.
Randall Benton/ The Sacramento Bee
California Governor Jerry Brown addresses members of the press about the State Budget for 2014-2015 at the Capitol in Sacramento on Thursday, January 9, 2014.
The Brown administration issued orders on Wednesday to give a total $56.4 million in raises to some 4,100 state managers and supervisors to comply with a lawsuit the state lost over pay parity for those employees.
According to the Department of Human Resources, about $32 million will go to 3,560 engineering managers and supervisors, or about $9,000 per employee for the year retroactive to July 1. About 570 scientists are in line for raises ranging between 26 percent and 42 percent, a total $24.4 million, or an annual increase of $42,800 per worker.
The raises make good on a 2008 court ruling that said the engineers’ and scientists’ managers and supervisors should be paid comparable wages for comparable work after several years of pay increases that lagged raises for the employees they managed.
Gov. Jerry Brown set aside money in the 2014-15 state budget to comply with the court decision.
Brian Nguyen/ The Sacramento Bee
The Board of Equalization headquarters with scaffolding around its base to protect pedestrians from falling glass.
Three state workers are suing the Board of Equalization, aiming to build a $75 million class action case that the agency violated its duty to provide a safe workplace and for years concealed serious work site health hazards from employees.
The lawsuit filed by Sacramento attorney Anthony M. Perez Jr., stems from mold and other defects at the boards 24-story headquarters in Sacramento where roughly 2,200 employees work for the tax-collecting agency. Perez is seeking class-action status for the lawsuit.
Board spokeswoman Venus Stromberg declined to comment on the pending litigation.
The Sacramento Superior Court lawsuit follows a tort claim that Perez filed with the board last month and launches just ahead of a key vote on legislation that would fund a search for an alternative site to the 450 N St. high rise. Meanwhile, the state auditor anticipates releasing a September report on what it would cost to repair the building.
Anne Chadwick Williams/ The Sacramento Bee
The CalPERS campus in Sacramento
Our lead story in today’s fiber/cyber Bee looks at a CalPERS proposal that would allow about 100 categories of state- and local-government employees’ supplemental pay to be included in their pension calculations, including temporary promotions that receive upgraded pay. Gov. Jerry Brown opposes including “temporary upgrade pay” in the list of salary enhancements that would factor into pension-benefit calculations.
A board committee approved the measure today and a vote by the full board is set for Wednesday.
Here’s the letter Brown sent last week to CalPERS Board of Administration President Rob Feckner, explaining the governor’s opposition to temporary upgrade pay. Below is the list of salary enhancements that CalPERS’ staff has proposed should be made pensionable. The list is an aggregate of supplemental pay types found across all of the fund’s member employers. No single employer uses them all.
State and local government supplemental pay categories
courtesy CalPERS Board of Administration
Priya Mathur, CalPERS Pension Health and Benefits chairwoman
A key CalPERS committee on Tuesday approved counting nearly 100 types of government-salary supplements toward employees pension benefits, including extra money workers earn for temporarily filling higher-paying jobs.
Although Gov. Jerry Brown objects to including such temporary upgrade pay in employees retirement calculations and city leaders worry the regulations will encourage pension spiking, the funds Pension and Health Benefits Committee put down a request by one of the governors appointees on the board to remove the controversial temp-pay category from the staff-proposed list. After rejecting the motion by a 6-2 vote, the committee approved all 99 items on the list by the same margin.
The proposed regulation, which defines language in a 2013 law that bases pensions on the normal monthly rate of pay or base pay, goes to the full CalPERS board for a final vote on Wednesday and is expected to pass. The proposed regulation does not affect employees who were members of a CalPERS pension fund before 2013.
Before the votes, Department of Finance budget analyst Eric Stern reiterated Browns objection to factoring in temporary payments, saying that they are the kind of ad hoc pay increases that the pension-reform law intends to eliminate from pension calculations.