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City Council: Figuring Out How to Avoid Municipal Bankruptcy; Maybe a BIG Bond? Police Win Community Policing Award; Etc.

At its Nov. 7 meeting (agenda:, the Monrovia City Council will ...

~ Try to figure out how the city can avoid avoid going broke. According to this report ( by City Manager Oliver Chi and Buffy Bullis, Administrative Services Director, "if we do nothing, current financial modeling indicates that the costs associated with the pending CalPERS UAL repayment schedule will strain our General Fund to the point of rendering the City insolvent in either FY 2021/22 or FY 2022/23."

So, how to avoid going broke? City staff proposes:

  • Having employees increase contributions to their pension plans, saving the city about $300,000 a year.
  •  Issuing a bond to refinance the city's unfunded retirement costs.
  • Adopting a policy that (as best I can figure it out) requires city staff to annually present to the city council any unfunded liabilities, along with a proposal of how to pay them off.
  • Increasing the city's Transient Occupancy Tax (basically a tax on hotel rooms) from 10% to 12%, which should raise about $400,000 annually.
  • Creating Community Facility Districts, basically an additional tax on new residential developments. This could raise about $300,000 annually.

~ Authorize the issuance of a bond to pay off the unfunded liabilities noted in the previous item for (if my calculations are correct) $112.3 million. Actually, $12.6 million of this amount would not be additional debt since it would go to pay off an earlier bond. Comment: I find it really odd that the staff report (here: recommends issuing the bond but does not give the total amount of the bond, so my calculation of $112.3 million is from the total amount of debt the report mentions.

~ Honor the Monrovia Police Department for winning the International Association of Chiefs of Police/Cisco Community Policing Award.

~ Swear in Alan Sanvictores as the new Monrovia police chief. This will happen at 6 p.m., before the regular meeting.

~ Consider authorizing city staff to set a public hearing  to consider water fee adjustments for January 16, 2018. Here's a rather exhaustive (exhausting?) discussion of the issue:

~ Consider changing the Monrovia municipal election date to March of even-numbered years beginning in 2020. This change is required by the state.

- Brad Haugaard


  1. It should NOT be just the bond measure! ALL options/solutions should be on the table; it takes a village -- in this case a City. We want our city employees to have the retirement they earned, but they too MUST bear more responsibility for their own retirement.

  2. RE: pensions & water fee

    Since the city continues to issue permits for high density residential development which results in these new resident's need to consume more city services (city employee time & schools) plus using more water, the city should recoup the expenses incurred by the new residents.
    This can be done by placing an annual assessment on new residents as well as the developers.

    More bonded indebtedness should be out of the question. The city is already burdened by bonded indebtedness for the mountain park and infrastructure replacement.

    Teetering on the verge of bankruptcy should be a huge issue in the next city council election. Someone needs to step forward and hold the incumbents accountable for this financial mismanagement.

    1. Notice that your proposal is part of the proposed plan. The fifth bullet point.

  3. They should get in on that weed money and allow dispensaries to open in Monrovia.

  4. There is a basic failure in the calculation of the unfunded liability.

    The rate of return assumption by CalPERS of 7% is not attainable in the low interest rate environment established by the US Federal Reserve as part of the fake recovery given us by the last Administration.

    A more realistic assumption would be 4%. In round terms, that triples whatever number CalPERS floats as Monrovia's share in the general disaster set up by Democrats and public employee unions (which Jerry Brown kicked off in his first term as governor a million years ago).

    A bond issue isn't going to do this, and the city savants cannot be planning against numbers from CalPERS. The city needs to wake up to the reality that increasing the tax base of the city and prioritizing spending are the only paths that might raise enough money to avoid bankruptcy. Some of the suggestions I would make is:
    +End the "freeze in time" committee to "preserve our neighborhoods" as they were in 1945. End the related restrictions on what people can do with their private property and the nannying by the city, which costs money out of pocket and reduces property tax revenues.
    +Prioritize operations of Monrovia Schools to properly balance administration bloat and actual work done to educate kids. Some "progressive" notions of how to educate may have to be ended. Better that kids can learn to write, read and do actual math. Sex education of 2nd graders, if this current fad has been adopted and as an example, should be struck from the curriculum.
    +Does anyone actually watch the televised city meetings? If not, this is a useless expense.
    +City salaries need to be compared with private sector salaries for equivalent positions and frozen if they are excessive, until what city employees earn is in line with those of the people who pay the bill.

    I am sure there are other ideas both to raise revenue reasonably and make spending more effective.

    Brad, I am with you in not seeing how refinancing an extant bond helps this predicament unless there is a clear expense reduction to be had. Diddling around the edges of a problem to appear to be doing something is a favorite pastime of faint hearts.

    That surely is not going to work now, and even strong measures may not make things work. We will be a lot closer salvation by taking strong measures now, that our savant leaders are "woke" to the problems.

  5. More on the topic. Is the pension liability actually more like $305 million??