Talk About Deception
Posted by scta | Filed under SMART
A recent PD editorial claims deception on the part of those wishing to repeal SMART’s Measure Q, the quarter cent sales tax. The actual deception has come from the SMART District itself. (more…)
Letter Sent to the Santa Rosa Council
Posted by scta | Filed under SMART
“I attended the study session on SMART at the 3/15/11 city council meeting, and was appalled to hear that the anticipated ridership for the initial 37 mile linkup was 2,900 (more…)
Gravy Train
Posted by scta | Filed under SMART
Despite the financial straits in which SMART finds itself, the SMART Board is busy making gifts to its employees. We were amazed to read in the minutes of their May 19, 2010 meeting that SMART is “paying the employee portions (approximately 7%) and the employer portion (approximately 12%) of all requirement retirement contributions.” More simply stated, they are paying the 7% which employees are required to contribute – in addition to the 12% SMART is required to pay.
At a time SMART is searching for more money, they are handing out taxpayer dollars to pay obligations for which the employees are contractually responsible. One can only wonder how many other gifts the SMART Board has authorized. This action by the Board is highly questionable. It certainly appears to violate the Board’s responsibility to prudently manage public funds.
If this type of decision-making typifies the SMART Board it is no wonder they face massive deficits. The Marin Grand Jury noted SMART has adopted an overly generous Pension Plan. We hope the Sonoma Grand Jury will investigate this retirement plan and the propriety of the SMART Board spending taxpayer’s dollars to pay the obligations of its employees.
Jeanne Levin and Mike Lavin
.
What was the SMART Board Thinking
Posted by scta | Filed under SMART
The following letter to the editor was published in The Press Democrat and was written by Association Director Mark Burchill:
One must have been hiking the Appalachian Trail for the past decade to be unaware of the fiscal train wreck that our state and local governments are dealing with, as they try to mitigate the crushing burden of exceedingly generous employee retirement benefits. One statement repeated many times is that the benefits were already promised, and can’t be changed for existing personnel. They can only be moderated for new hires.
So what was the SMART Board thinking when, as a brand-new government agency, they set up another high-priced retirement program? The SMART Board had a blank sheet, which offered them the opportunity to act responsibly. Instead, they repeated the same mistake that politicians have been making over the past decade.
The Marin County Grand Jury is correct. This blatant example of irresponsible politicians throwing our money around like confetti needs to be stopped now.
Taxpayers’ Asstn. Reasserts Need for Second Financial Opinion
Posted by scta | Filed under SMART
April 19, 2010
Debora Fudge, Chair and the SMART Board
Re: Your letter of April 5
Dear Chairwoman Fudge and Board:
Thank you for taking the time to read and respond to my letter containing our Association’s recommendation for an independent second opinion of SMART’s Strategic Plan. Based on your response, it appears you have misunderstood the nature of our suggestion and its benefits. We are not just suggesting more experts. We are well aware that SMART has engaged a number of “experts” in the preparation of the Strategic Plan that is now discredited.
What we are recommending is SMART have a completely independent review/second opinion of the revised plan, by a professional firm that would put its reputation on the line by issuing a “comfort letter”. This letter would provide some assurance that the plan was viable and would withstand future events.
In spite of the experts employed and the reviews conducted so far, the financial plan remains in disarray. This suggests that there is room for improvement. Based on the present circumstances it would seem reasonable to conclude that what is not needed is more of the same.
In your letter you lay the blame for the present funding gap on the recession. Recessions and business cycles happen. Their timing and magnitude cannot be forecast with any reliability, but a plan that covers a 20-year period should make some preparations for recessions. From what we can see the original Strategic Plan made no allowance whatsoever for any ups and downs of the business cycle. A good strategy when devising financial plans is to “stress test” them to see if they can withstand recessions of various magnitudes and timing. Knowing what we know now, it would be a shame to repeat that oversight and to fail to anticipate the impact of business cycles on the Plan.
Your suggestion that the Citizens Oversight Committee (COC) provides an independent review and a check and balance on the District’s activities is unpersuasive. This is because COC members are appointed by District board members. This puts them in a position of being beholden to those they are to oversee for their very appointments. It’s also unlikely that these members have the professional background to provide the kind of independent review of the financial plans that would guard against the kind of financial fiasco now facing the District. As a matter of fact the existence of the COC did not prevent the present situation. To suggest that the COC provides any meaningful accountability is simply not credible.
Taxpayers’ confidence in the leadership of the SMART District to provide the benefits represented in the Measure Q tax measure has been shaken. Our recommendation for an independent second opinion was made to help raise the confidence of the taxpayers and to try to prevent further spending of taxpayers’ funds without being able to produce the promised results.
Sincerely,
Jack Atkin
President
SMART responds to Taxpayers’ Asstn. Suggestion for Second Opinion
Posted by scta | Filed under SMART
April 5, 2010
Jack Atkin
President, Sonoma County Taxpayers Association
Re: Your letter of March 23, 2010
Dear Mr. Atkin,
Thank you for your letter recommending that SMART engage an outside professional consulting firm to evaluate our financial and strategic planning documents. We agree that an extra set of eyes can be helpful in assessing the feasibility of such plans.
That is why, in 2008 with our Funding Plan and again in 2009 with our Strategic Plan, we welcomed the participation of several independent evaluators as part of the process. And, as we continue to re-evaluate our cost and revenue projections, we will invite continued independent review of that process.
As a public agency committed to transparency in all of our activities, SMART’s financial projections are open to review by any interested citizen. It is my understanding that you and your organization have asked for and received access to an array of our financial documents, so you are aware of the amount of outside participation we have encouraged to date. To recap:
n Our 2008 Funding Plan was prepared with the assistance of Parsons Brinkerhoff, an internationally known transportation consulting firm, and KNN Public Finance, a well-respected financial advisory firm with a long list of public agency clients that includes the Sonoma County Transportation Authority.
n The 2008 Funding Plan was thoroughly vetted by a subcommittee appointed by the Transportation Authority of Marin. The subcommittee reported its findings to the Authority’s full Board, which voted to endorse and support Measure Q.
n The 2008 Funding Plan was reviewed by Dr. Robert Eyler, director of the Center for Regional Economic Analysis at Sonoma State University. Dr. Eyler found the plan to be “reasonable and conservative.”
That 2008 Funding Plan was prepared in the spring of 2008 and adopted by the SMART Board in July 2008. At the time it was clear that economic conditions were beginning to change, and the revenue projections contained in the plan were adjusted to reflect those conditions. Sales tax receipts, which had grown at an average annual rate of nearly 5 percent in Marin and Sonoma Counties for the previous 20 years, were projected to grow at 0 percent for 2009, 2010 and 2011, and to remain at 4 percent or below for the life of the 20-year Measure Q sales tax.
In the fall of 2008 and winter of 2009, after the Funding Plan was adopted and Measure Q passed, we entered the most severe recession the United States has experienced since the Great Depression. Not only did sales tax receipts drop precipitously, but credit markets experienced a severe transformation that negatively affected SMART’s bonding capacity. The SMART Board was informed of these changes beginning in February 2009, and the SMART Citizen Oversight Committee – a group of respected community leaders not associated with the development of the Funding Plan – began working on the Strategic Plan in April 2009. With the aid of consultants from Parsons Brinkerhoff and KNN Finance, the COC identified the projected $155 million funding gap that has received so much attention over the past year.
In addition to examining SMART’s revenue and cost projections, the COC in 2009 recommended that SMART obtain a new and independent 20-year sales tax forecast from Beacon Economics, a well-known economics firm that performs such forecasts for the State of California and many local governments. Beacon’s forecast was even more conservative than KNN’s updated forecast, and was used as the basis for revenue projections for the 2009 Strategic Plan.
The Strategic Plan is based upon revenue projections and cost estimates. As such, it is a living document that will change as more information becomes available. We continue to seek additional revenues for the project, and the detailed design and engineering work being performed this year will help us refine cost projections by the fall of 2010.
In summary, I disagree with your conclusion that SMART’s financial planning is flawed because of a need for more review. Our financial situation is caused by the same economic forces that are affecting the finances of every government agency that relies on tax receipts – along with the finances of most businesses and many individual households.
Thankfully, we still have significant revenues available to us from Measure Q. With that support from nearly 70 percent of the voters of Marin and Sonoma Counties, we are hard at work building an alternative transportation system that will benefit the environment, the economy and the quality of life for all who live in the North Bay.
Sincerely,
Debora Fudge
Chairwoman, SMART Board of Directors