Oxnard City Hall’s inability to do basic math means that the city council put Oxnard’s taxpayers on the hook for millions more than the public was told … again.
The city council recently approved new agreements with three employee unions. Staff reports told the public that these three contracts combined would increase costs by $5.5 million through June 2021, but corrected math shows the real cost increase is approximately $10 million.
Oxnard city council members (especially Mayor Flynn) keep blaming past administrations for signing contracts without considering the real future costs, but then he and the rest of the current council unanimously voted for these contracts in which the real costs over the next two years are almost $4.5 million higher than the public was told.
But the problem is even worse than that. These costs won’t go away when these agreements expire in June 2021. Instead, they will become the new expected baseline for future contract negotiations. We’re talking millions more in each year’s budget for the foreseeable future.
These new agreements increase the amount that the city contributes toward employee health insurance premiums. How much will these agreements increase ongoing costs for the city? That’s where the city had problems with its math.
City staff claims that a cost increase of $400/month … followed by a second increase of $400/month … followed by a third increase of $400/month, somehow magically only amounts to a total cost of $400/month.
In the real world … outside of city hall … these increases are cumulative – making the cost $400/month in phase one, $800/month in phase two, and $1200/month in phase three.
Obviously, such a mistake dramatically understates the total cost of the agreement.
Similar mistakes were made calculating the costs of the various other negotiated concessions, only counting the incremental increases from one phase to the next rather than counting the full difference between the new rate and the existing benefit levels prior to the agreement.
City staff’s calculations didn’t even include all of the concessions listed in the contracts.
Noticing these multi-million-dollar errors does not require knowledge of higher-level math. It does not require a finance or accounting degree. It is grade-school level addition, subtraction and multiplication.
The details of these contracts and the projected costs went through several departments: human resources, the city manager’s office, the city attorney’s office. The city council discussed them in closed sessions. No one corrected the miscalculations. Not even the school teachers on the city council.
A member of the public pointed out the mistake before and during the May 7 council meeting when the city council approved the third agreement. But it was to no avail.
Is it too much to ask that our city’s leaders at least understand enough grade-school math to protect the public from these sorts of … mistakes?
City Manager Alex Nguyen told the council that he expects similar benefit increases will be negotiated with more employees in other unions over the summer.
Will city hall put forth the same novel math calculations at that time?
Will the city council again turn a blind eye?
There is never a good time to make multi-million dollar math errors with taxpayer money, especially when the city manager is talking about budget shortfalls, cutting city services, and laying off city workers.
Unfortunately we’ve seen city hall do it time and time again, like these examples from our blog:
The next time you hear council members say that it isn’t their job to question whether the information they’re being given is correct, just remember that it’s your money they are spending.
P.S. Want to see the staff reports and contracts we are talking about? Notice in the "Financial Impact" section of these reports that from year to year, staff claims that the annual costs decrease even though the benefits are increasing each year: