Coordination of Laguna Beach’s many initiatives and paying for pension costs surfaced as priorities at the City Council’s recent planning retreat.
At a time when many of the hot-button projects begun in the last year have yet to be finalized, it comes as no surprise that Council members largely opted to stay the course and not tackle major new projects.
An exception was singled out by Mayor Pro Tem Bob Whalen, who called for developing a long-range financial plan to absorb pension costs, expected to rise $7 million in the next five years, as an important new priority.
In January, the city’s Finance Director Gavin Curran outlined the city’s vulnerability to changing pension rates. Following rate increases two years ago, the employee pension fund Calpers forecasts still more to come over the next five years, pushing the city’s expected contribution rate up to 12 percent of payroll, which could cost almost $7 million. And Calpers is expected to soon propose yet another rate increase to cover the cost of retirees living longer. A staff report notes that every 1 percent payroll hike demanded by Calpers costs the city about $200,000.
And in the fiscal year 2015-16, local governments will be required to report unfunded retirement-benefit liability on their balance sheets. Laguna’s unfunded liability, as currently projected by Calpers, comes to $53 million.
Two of the highest priorities identified in last year’s came to partial fruition in 2013: mapping out a concept for the village entrance and developing a view preservation ordinance. They are still in the works and will continue to draw on the city’s staff in 2014. “It’s a slow process and you have to be patient,” said Council member Steve Dicterow. If, as an elected official, “you can get one or two major things done in a year, you’re ahead of the game,” said Dicterow, following last month’s annual conclave where elected officials review the past year’s progress, take stock and set the agenda for the year to come.
For that reason, he believes it imprudent to add new projects to the staff’s to-do list. They already are at work on changes to improve parking, updating the downtown specific plan, mobility and transit studies and options for Laguna Canyon Road improvements.
The interlocking initiatives need oversight, said Dicterow. From the retreat emerged a decision to direct City Manager John Pietig to identify a staff member to oversee and synchronize all of the city’s projects. Elected officials also intend to schedule a mid-year session to work on long-range planning.
“It will be a busy year,” concluded Whalen.