Opportunity for Public Input Regarding New City Manager at Three Upcoming Listening Sessions

LAGUNA BEACH, CA – As the City of Laguna Beach undertakes its search for a new City Manager, the City Council wants to ensure the public has an opportunity to provide feedback about the most important qualities potential candidates should possess.

The public is invited to attend three virtual Listening Sessions on March 6, March 11, and March 16, facilitated by the City’s executive search firm Bob Murray and Associates. The firm’s Executive Vice President, Gary Phillips, will host the sessions via Zoom at the dates, times and Zoom links below. For additional information on all available options to participate in the upcoming Zoom webinar Listening Sessions, Click HERE.

View City Manager’s Press Release here

Saturday, March 6: 10:00 a.m. – 11:00 a.m.

Please click the link below to join the webinar:
https://lagunabeachcity.zoom.us/j/97545461467

Or join by Telephone:

Dial (US): +1 669 900 9128
Webinar ID: 975 4546 1467

Thursday, March 11: 6:00 p.m. – 7:00 p.m.

Please click the link below to join the webinar:
https://lagunabeachcity.zoom.us/j/94968456127

Or join by Telephone:

Dial (US): +1 669 900 9128
Webinar ID: 949 6845 6127

Tuesday, March 16: 6:00 p.m. – 7:00 p.m.

Please click the link below to join the webinar:
https://lagunabeachcity.zoom.us/j/95174625549

Or join by Telephone:

Dial (US): +1 669 900 9128
Webinar ID: 951 7462 5549

Online Public Survey Available

Additionally, an online public survey regarding the City Manager recruitment is now available at the following link: http://bit.ly/LagunaBeachCMSurvey2021

A report containing all the comments and feedback received will be compiled by the recruiter and provided to the Laguna Beach City Council. The City Council has sole responsibility of appointing a City Manager, and anticipates to select a candidate for City Manager in May. The City Manager serves as the chief executive for the City of Laguna Beach.

Laguna Beach City Manager Recruitment 2021

This year, the City of Laguna Beach will hire a new city manager to replace City Manager John Pietig slated to retire in June of 2021. Laguna Beach is a beautiful coastal city with a great reputation and is considered to be a highly sought after place of employment. The City should be able to attract the highest qualified candidates.

The City Council chooses the city manager. After receiving public input regarding the qualities desired for this critical position and considering new management, they agreed to hold an open executive search. The issue became somewhat controversial among city leaders and constituents. This was resolved on Saturday, January 30, 2020 when the City Council voted 4-1 to hire Bob Murray & Associates to conduct an executive search and include constituents input in the process.

Interesting to note that City Councilman Peter Blake publicly opposed the public’s request to do an outside search, voted no on the open recruitment, and stated he wanted to hire internally and had selected Assistant City Manager, Shoreh Dupuis. In interviews, CC Blake expressed his bias and favoritism of Ms. Dupuis. In fact, in a STUNEWS story, he stated that he felt that if she didn’t get the job, she would leave our city. He used this same threatening approach in 2019 to secure ACM Dupuis a $25,000 salary increase for “future” work. Residents objecting to the salary increase requested proof that a position had been offered to Ms. Dupuis at the time but none was ever provided. It was disappointing to hear since Ms. Dupuis is paid a top salary and benefit package and taxpayers subsidized her Laguna Beach Beach $1.6 M home when she was hired in 2016 with primarily government public works and some transit related experience. In various polls on social media, residents support open recruitment for the replacement of the top-notch city manager rather than promoting from within.

Local Media Coverage:

Laguna Beach City Council under pressure to open recruitment for next city manager – LB Indy

Laguna Beach City Manager John Pietig Announces Retirement – LB Indy

Letters To The Editor: City Manager Recruitment – Stu News

Find more letters in Stu News Archives here

Letter: Why Are City Employees Leaving Laguna Beach? LB Indy

Letter: Is Our City Tuned into its Employees? LB Indy

Opportunity for Public Input on city manager position press release – LB Patch.com

City Welcomes New Police Chief

A message from the new LBPD Chief Robert Thompson:

On behalf of my family and myself, I want to thank the people of Laguna Beach for
a warm welcome. As a frequent visitor to the city, we have been amazed at the
kindness of the people we’ve met, the spectacular beach and dining. It was this
experience as visitors which led us to embracing the exciting opportunity to join the
team as a member of the police department. Laguna Beach is a special place, a
place people choose to be, and one we are humbled to be a small part of.

I remain committed to helping provide accurate and timely information, being
accessible to the community, and listening and learning as policing in America
evolves in this new era. The men and women of the Laguna Beach Police
Department and dedicated and committed to the safety and welfare of all residents
and guests. With the support of the community, I am confident we are wellpositioned
to continue to provide the service the people of Laguna Beach deserve
and expect.

Thank you all for the kindness you’ve shown my family as we settle in Orange
County, and I look forward to serving this outstanding community.

Looking for the latest data on Crime and Safety in Laguna Beach – Click Here

To Learn more on the city’s new Police Chief’s background view the article in Public CEO here.

LB Chat Publisher’s Open Letter To 2021 City Council

January 19, 2021

Dear Mayor Whalen and City Council Members:

Happy New Year. As the council moves forward in appointing a new city manager this
year, I ask that a professional recruitment firm be hired to conduct an open and extensive
recruitment to fill this important leadership position. Based upon city records, in
2010, Murray & Associates was hired to handle the recruitment process when CM John
Pietig was appointed. In 2012, this same firm contributed to the recruitment guideline
document below. It’s well worth a read.

https://icma.org/sites/default/files/303514 – Recruitment Guidelines for Selecting a Local Government Administrator.pdf

As a longtime resident, I am not convinced that we currently have an internal successor
pool to fill this position that would be supported by the majority of residents. We have
the opportunity to find a city manager with the type of leadership, interpersonal skills
and personality that city employees, residents and businesses desire and deserve. In fact,I would like to suggest that the council ask for some public input on the important attributes of a new city manager to use in their decision making and conduct an outsourced confidential city employee satisfaction survey to identify internal cultural issues that might exist that could provide valuable insight to the incoming administrator. Here’s an example of an employee survey that I found quite impressive. https://www.cityofpensacola.com/CivicSend/ViewMessage/Message/122077

I have personally participated in government employee surveys of this type and the results often surprise city leaders. Also, below is an article titled “It Starts With Civility: Elected Officials’ Role in attracting and Retaining Employees” that speaks to government recruitments, civility and leadership within council chambers. I believe this information critical to achieving positive engagement between public officials and constituents for a healthy and harmonious community.

Since 2018, we have documentation that clearly reflects our city having respect and civility issues that has consumed our civic environment and continues to divide us.
Much time and money has been lost due to a high level of discourse between certain
council members and the public. This is a good article written by two California city
managers who understand the intricacies involved in government recruitment and retention
and the importance of finding a strong administrator who listens and can implement
and execute ideas with the support of council members and the public.

https://www.westerncity.com/article/it-starts-civility-elected-officials-role-attracting-and-retaining-employees

Thank you for your time and consideration. You all have a big responsibility to the
community and I trust that you will take the utmost care in finding the right city manager
to unite and move us forward. Thank you for all that you do for Laguna.

Respectfully,
MJ Abraham
LB Resident

Note: Here’s a copy of my first LTE on this subject. It has been distributed to local media
and will be posted on social media outlets as well. It was published today January
19, 2021 in Stunews.

Include Residents in the Process How disappointing to discover that meetings regarding upcoming CalTrans work in South Laguna were not (until now) publicly held. I hope that the city will not make this mistake when it comes to recruiting a new city manager. An open recruitment process will boost confidence and trust in our local government.

Combined, Ken Frank and John Pietig will have served Laguna for 51 years. This powerful
position is pivotal for the city budget, overseeing projects of all types, coordinating with all outside agencies, and working well with staff and council. I encourage residents to get involved in this next chapter of a city manager and start generating ideas of the type of person we would like to see as our next city manager. The position requires strong leadership and management skills to navigate the often politically charged decisions that inevitably arise.

Laguna has a great climate, attractive compensation and beneCits like Fridays off. For a city its size, this job will be a compelling opportunity, likely generating inquiries from some of the best-run cities in the country. I hope that the council will take its time, include residents and choose carefully.

MJ Abraham
Founder lagunabeachchat.com
Laguna Beach Resident

Fiscal Prudence Makes Surprise Visit to LB City Hall-Part 1

During the City Council meeting on February 28, 2017, Laguna Beach resident Emil Monda spoke during the public communications period. During public communications anyone can speak on a topic of their choice for 3 minutes. Mr. Monda brought up a concern that had been circulating among residents since it had become known that the City had an “Essential Employee Housing Assistance Program” (EEHAP) and that the program had no official guidelines. Mr. Monda admonished the Council to review the program and “develop a detailed written policy…to clarify eligible positions, what the program offers to the employee and the responsibility of the employee who makes use of the program”. He voiced the concerns that many residents had that the City was offering to enter into 50/50 ownership arrangements with certain senior staff members under the idea that certain “essential” employees needed to live in Laguna Beach so as to be most effective in their jobs. In addition to becoming joint-owners on the properties, the City would also become the mortgage provider for the employee’s share of the purchase.

A Bit of Background and Some Maths

The EEHAP program was started in April 2000 when the then city council (motion by Dicterow, seconded by Iseman and supported by all others: Blackburn, Peterson, Freeman) approved the program which was intended to encourage employees having “essential emergency response duties and/or department heads essential to the efficient operation of the City to live in the City and be available to quickly respond to emergencies and other exigent conditions”. Back then, the median Laguna Beach house cost $625,000 and the informal program (recall, it was never formalized) was targeted at positions such as: City Manger, Assistant City Manager, Fire Chief, Fire Division Chief, Sewerage Supervisor, etc. During the ensueing 17 years, only 6 City essential employees have taken advantage of the program they are with the year they entered the program:

1. Mike Macy (former Fire Chief)
2. Jeff LaTendresse (a Battalion Chief at the time of the agreement, now Fire Chief) – 2000
3. Tom Christopher (Fire Division Chief) – 2006
4. Graham Wright (former Water Quality Supervisor)
5. Shohreh Dupuis (Assistant City Manager/Director of Public Works) – 2016
6. John Pietig (Asst City Mgr at the time of the agreement, now City Manager) – 2001

The most recent recipient of the program was Ms. Dupuis, who joined the City on or about May 1 2016. During the May 10, 2016 City Council meeting, a motion was made and unanimously passed to include Ms. Dupuis in the EEHAP with a term to:

“(c) appropriate $1.3 million from the proceeds received from the sale of 1044 Noria Way and 1419 Regatta Road toward this transaction and, if necessary until the properties are sold, temporarily borrow from the Insurance Fund to complete the transaction.“

(1044 Noria Way was the home that was jointly owned between the City and Fire Chief LaTendresse). So until just 14 months ago, the City Council felt that the program was reasonable, even though Ms. Dupuis’ likely total annual compensation (excluding pension benefits) is over $220,000 (we don’t have the exact figure but are using the 2016 figure for the other Assistant City Manager, Ms. Christa Johnson). Total annual cost to the City taxpayer’s for Ms. Dupuis inclusive of benefits is well over $275,000. For the Dupuis purchase, the City put in $797,500 for a 50% ownership, plus it provided a $450,000 loan. This means that the Dupuis contributed approximately $347,500 towards the total purchase price, or just under 22%. A commercial 30yr fixed mortgage for such a property would cost borrowers about $6,900 per month at current interest rates. On her income alone (ignoring that of her spouse), it seems that the Assistant City Manager could afford the house they purchased without any assistance from the City.

As is mentioned above, Fire Chief LaTendresse exited the program in July of 2016, and the City was the beneficiary of 50% of the proceeds of the sale of his property. As we see now, the Fire Chief’s exiting from the program was an early indicator of his intention to leave city employment (he announced his retirement in July 2017). A term of the program is that once the participating employee retires or otherwise separates from City employment, the joint-ownership arrangment must end; either through a sale of the property or a ‘buy-out’ by the exiting employee of the City’s interest. With LaTendresse’s exit, only 3 employees remain in the program: Christopher, Pietig and most recently, Dupuis. It is worthwhile noting however, under the programs if the participant retires and has been in the program for X years, they have X years after retirement to complete the sale. Since Mr. LaTendresse was in the program for over 16 years our reading of the program indicates that he could have waited until 2033 to buy-out the city’s equity in his home. The taxpayers’ money could have been tied-up for 32 years in this property.

The analysis done by City staff found that contrary to common assumptions, the City did not gain financially through participation in the EEHAP. Most thought that despite tying up large amounts of taxpayers’ funds in local properties, property-value increases together with the loan interest-rate being pegged at an amount slightly higher than the City gains from investments would naturally mean that the City gains financially through the program. The findings were that the City actually loses approximately $8,200 per participant/per year via the program. The reasons given were: “ongoing costs for property insurance, property taxes, reimbursement of federal and state taxes attributable to City ownership interest, and qualifying property repairs have created an annual cost for some properties. … the annual cost of the three properties recently sold in the Program averaged approximately $8,200 for each employee…”.

Reduced Need for Such a Program

Half of the program’s participants have been with the Fire department and most would agree that having managers of this department living in the City would be adventageous. However, the Fire department has gone to 24-hour shift management, meaning that there is always senior management on-duty in the City. This reduces the need for EEHAP participation for senior Fire department staff. For the sewerage department, the City has established the ‘Wastewater Emergency On-Call Response Program’ in 2003. As stated in the staff report: “This program was designed to help facilitate response to the sewer system emergencies (sic). In general, the program reimburses four employees up to $987 a month for locating in the City and being on-call.”

Since arguably the most ‘essential’ City staff have now been accommodated and are guaranteed to be in-City 24/7, the only other eligible employees are the City Manager and various Assistant City Managers. It is far less clear how having employees in these roles living in the City adds to residents’ safety or better execution of City operations. Maybe I’m missing something.

One-Percenters Don’t Need Public Housing Assistance

This author presented 2016 remuneration data for Laguna Beach employees (sourced from www.transparentcalifornia.com) during the City Council meeting of July 11 2017, as part of his argument against continuing the EEHAP. We reproduce the graphic here:

(These data are from 2016 and so the current amounts should all be increased by about 3% according to the most recent terms of the Employee Union contract).

After presenting this data, the City Manager felt it necessary to add some context to his EEHAP deal and where is current remuneration stands. His point, which is valid to a limited degree, is that he took the deal while he was still Assistant City Manager/Sewer System Manager and earning a lot less than the 2016 indicated amount. The background of his EEHAP deal:

  • Originated in April 2001
  • City put in $400,000, or 57.89% of the purchase price ($690,965) and provided him a loan for a portion of his remaining 42.11%

In April 2001 the Assistant City Manager was earning $136,200 annually ($11,350 per/mo). The then prevailing 30 year-fixed home loan interest-rate was approximately 7.0%. Assuming a 10% downpayment, the Pietig’s would have had monthly P&I payments of $4,138 and total monthly payments (inclusive of property taxes & insurance) of $4,925. This would have been too large of share of the monthly income at 40%. If the Pietigs could have made a 20% downpayment on the home, the numbers change a lot, and the percentage of monthly income needed for the purchase would have been 36.6%, arguably a manageable amount. Fiscal prudence might have dictated that the Pietigs wait a few years for the city salary to increase and their savings to do likewise and the purchase could have no doubt been made comfortably.

Final Thoughts

In the end, we applaud the City Council for halting future use of this informal program. The remaining 3 City employees will continue to enjoy the benefits of joint-ownership but we encourage them to buy their way out as soon as possible. The taxpayers’ money can be put to better use.

While the program will not continue to be used, we have some concerns that the program (or something largely similar) might be used on an ‘ad hoc’ basis in the future. During the Council’s deliberations on the agenda item, Mr. Dicterow (who readers will recall was the Council member who originally made the motion that resulted in the programs’ establishment in 2000) commented that he wanted the Council to have the option of using a housing assistance program in an ad hoc fashion. He stated: “I can support case-by-case assistance”. His reasoning was that when the city needs a new City Manager, such a facility should be available to the Council to ensure that the new manager lives in the city.

This author believes this is a very dangerous precedent and is worse than having an unwritten but semi-understood program in place in the first place. We take comfort in that the motion that the Council passed explicitly opted for Staff Report Option #4: “Discontinuing the program”, and expect that if a future Council wanted to offer ‘essential housing assistance’ in the future, the proposal would have to be agendized, discussed and voted upon before the public.

 

Pietig’s Pay; Plenty Perplexing

At about 11pm at the end of the March 28 City Council meeting, the council addressed the last item on the agenda: the annual review of City Manager Pietig’s employment contract.  This author was the only ‘member of the public’ remaining in the City Hall chambers to watch this annual spectacle of Council members singing the praises of a City Manager who is apparently perfect in every way.

With a 5/0 vote, Mr. Pietig was granted his demands which consisted of:

  1. Extension of his employment contract to June 30, 2020 with an automatic additional 1 year extension to be enacted on July 1, 2018 (extending the total contract until June 30, 2021). The automatic extension will happen unless the City Council intervenes to stop the automatic extension.
  2. Provision of a 5% “exceptional performance” pay/bonus for the next year (effective March 27, 2017, to be calculated against his current Regular Pay)
  3. Elimination of a $4000 annual cap on reimbursements for attendance at conferences or payment of dues (no new limit on these reimbursements was mentioned).

It is difficult for the average Laguna Beach tax payer to determine what all of these newest changes to Mr. Pietig’s employment contract mean in terms of dollars and cents.  Since Mr. Pietig’s contract is reviewed and revised annually, with concessions that roll-out over a period of several years and which overlap earlier concessions, the nett results are very difficult to determine.  I have reviewed the relevant Staff Reports and can not claim to understand the details completely.

Take for example, the current concession of a 5% “exceptional performance” bonus which was sought and granted. The City Council made a point of saying that this was not a request for a salary increase; instead it is an optional, 1-time bonus. That sounds good, but the reader needs to bear in mind that Mr. Pietig has already been granted annual salary increase guarantees in previous years’ contract concessions.  Plus, the 5% “exceptional performance” bonus appears to be granted during annual reviews when a salary increase is already due, as agreed in previous year’s negotiations.  As best I can tell, the current 5% bonus will ride on top of an already approved 3% salary increase scheduled for July 1 2017.  LagunabeachCHAT tried to piece together the history of concessions that Mr. Pietig has received over the past several years from the City Council.  The overlapping increases to salary (negotiated directly with the City Manager or as part of a city-wide increase for all “management employees”) together with the 5% “exceptional performance” bonuses makes it very difficult to get a firm grasp of Mr. Pietig’s actual remuneration. (We will be the first to admit we might have gotten it wrong; and if so we will print a correction). Graphically, here’s what we’ve been able to piece together from the Staff Reports over the past 3 years:

Blue stars represent concessions that were agreed at the 2/3/15 City Council meeting. Those in red, during the 1/12/16 City Council meeting, and so on.  For reference, I have included links to the relevant Staff Reports where all of these concessions are discussed:

1 – Staff Report referenced in the City Council decision of Feb 3, 2015 is here

2 – Staff Report referenced in the City Council decision of Jan 12, 2016 is here

3 – Staff Report referenced in the City Council decision of Mar 28, 2017 is here

Pouring through those documents, what we can see is that Mr. Pietgi’s total compensation at the point of 2015 was:

Regular Pay – $229,436.69

Other Pay – $20,476.14

Benefits Pay – $71,579.66

Total Pay – $321,492.49

The Staff Report from 2017 indicates that his current Regular Pay is $251,809 and is scheduled for a 3% increase on July 1, 2017 (to $259,363) and another 3% on July 1, 2018 (to $267,144) as indicated on our graph above. We estimate that his total compensation will have reached $358,124 at the completion of that fiscal year).

I have to point out that in reviewing the remuneration of the City Managers in other Orange County cities, that of Mr. Pietig’s falls in the middle of the pack. That is to say, his 2015 total remuneration is at about the 50% percentile of the other 30-odd City Managers.  But bear in mind that such a comparison places him in the company of City Managers who’s cities have populations an order of magnitude more residents than Laguna Beach. The city of Santa Ana which has a population of 334,000 provides total remuneration of $453,000 to its City Manager, the highest in Orange County, as detailed last year in a Voice of OC article.  With Mr. Pietig soon at or near $350,000 per year, he is earning 3/4’s of that amount with 1/13th of the population.

A final note I’d like to make on this topic.  During the Council meeting on March 28, 2017 at 11pm, several council members took pains to extol on the many virtues of Mr. Pietig.  He is in their estimation among the best of the best. That very well may be. I am in no position to determine how well he compares to other senior city executives in other cities. However, I’d like to make a couple of points on that line of reasoning as the basis for handing out endless numbers of annual pay increases and ‘”exceptional performance” bonuses:

  1. An executive at this level is expected to perform superbly and with the highest standards, otherwise they should not have the job in the 1st place. When did traits such as quick turn-around time and encyclopaedic knowledge of city issues become extraordinary for a City Manager?  Isn’t this the standard of performance that tax payers should expect? So how do these traits (which Mr. Pietig may well possess) become the basis of granting these generous, yearly concessions?
  2. Private Company CEO comparison – To my mind, this comparison is not valid. Although both City Managers and CEOs require substantial leadership and organisational skills, a CEO of a publicly traded company deals with many issues and pressures that a City Manager simply does not. A CEO is measured on the change in value that their leadership brings to the company and hence, the share holders of the enterprise. And commercial enterprises are not guaranteed the majority of their annual income through the collection of taxes that are mandatory contributions to a City Manager’s “enterprise”. To suggest that Mr. Pietig’s job is similar to that of a CEO leading an enterprise with a $70+ million annual turnover is not a valid comparison.  Therefore to look at CEO’s compensation as a relevant measuring stick to that of a City Manager is not reasonable.
  3. Need to compete with other cities – This is a valid concern. City Councils everywhere give-in to the demands of their executive employees with little regard for the financial implications.  The close and often long-term relationships that City Councils develop with their senior management leads them to be very supportive of demands for increases in compensation from these senior managers, as long as these senior managers give them the political capital they need to keep and do their jobs. We end up with an ‘arms race’ in executive compensation.  I do not have a solution to this dilemma, other than for City Councils to be very savvy in the HR policies they promote which may lead to viable future senior managers to be nurtured from within existing City employee staff.

What can we, the tax paying residents of Laguna Beach do check the apparent largess that the City Council seems determined to visit upon the City Manager annually?  Attend council meetings and make your voice hear during the public comments period.  You can send emails to the council members with your thoughts.  You can also register your opinion by taking the Survey Monkey survey that we’ve put together, to determine Laguna Beach voters’ opinions on governance: https://www.surveymonkey.com/r/X6Y2PJ9

 

New Blood? – Current Councilmembers average 10+ years of service

LagunaBeachCHAT analyzed the terms of all LB City Councilmembers going back to the mid-70’s.  The image above shows the terms-in-office of the current councilmembers (in red). Readers can see that the current council has 2 members serving their 5th terms (Iseman and Dicterow), Boyd serving his 4th, Whalen serving his 2nd and freshman Zur Schmiede serving his 1st.

This trend towards incumbents hanging around for exceedingly long periods is a recent one. If you look at the history (follow the link below to open the spreadsheet), you will see that in the past, 3 terms was the exception.

LagunaBeachCHAT applauds our current long-serving Councilmembers for their dedication and service to the city. However, the council positions were never intended to be life-long, and given the incumbent-advantage in elections, it means that promising new voices have a very difficult time getting a chance to serve.  There’s also the risk that innovative ways of addressing new challenges that our city faces are being overlooked in favor of old thinking that hasn’t worked so well in the past. LagunaBeachCHAT strongly advocates for councilmembers to relinquish their seats after no more than 2 terms.  Its only fair to give other folks a chance to serve and contribute.

Click here to see the full spreadsheet.

City Council Representation in Laguna Beach – Are District Elections Fairer?

Laguna Beach City Council members are elected “at large,” which means each is supposed to represent the interests of all citizens equally.  However as most Lagunans recognize, the different neighborhoods that comprise Laguna Beach are very different and experience very different issues and challenges. For example, those folks living in the Canyon area have different concerns from those living in Emerald Bay or Arch Beach.

The different issues and priorities of residents in these different neighborhoods most likely cannot be fully appreciated by someone who doesn’t live in the neighborhoods. This fact causes LagunaBeachCHAT to seriously consider that the residents of our city may be served better by DISTRICT-based city council members. District (or precinct/ward) based elections ensure that the person representing your interests on the City Council comes from your neighborhood and therefore is likely to better understand your issues and be more passionate about them. District-based elections also tend to lessen the influence of big-money election contributors and favor the retail-style of politics where candidates knock on a lot of doors to make themselves and their positions known.

District-based elections are becoming more common in Orange County. Currently, 7 cities have moved to district-based City Council elections (Anaheim, Garden Grove, Buena Park, San Juan Capistrano, Fullerton, Costa Mesa and Placentia).  And of course, all Orange County voters are already familiar with district elections when they cast their vote for the Board Of Supervisors, (Laguna Beach is in District 5, currently represented by Supervisor Lisa Bartlett, former Mayor of Dana Point). LagunaBeachCHAT believes that the time has come to seriously consider moving to a district-based representation system for Laguna Beach. Please leave us a message with your thoughts, since we’ll be revisiting this topic throughout 2017.

Below is a map of Laguna Beach with YELLOW dots showing where our current 5 City Council persons live. Does this distribution look fair and equitable for all Laguna Beach neighborhoods?

New Employee Receives Special Perk – Updated

Story Update – Guess who earns more than the Governor of California?

The excessively high salaries of city managers is a troubling California epidemic. Our City Manager and Assist City Mgr/Dir public works both earn far more in total remuneration than the GOVERNOR of California.
CY2019
Pietig: $359k
Dupuis: $330k (est)
Newsome: $278k

Review City Agenda Bill forms here
Review City Housing Agreement here

LB is 48th out of 567 cities in California, in terms of the total remuneration given to the City Manager. https://publicpay.ca.gov/. Tiny LB ranks high in terms of tax-payer largess.

The ever escalating remuneration packages that California cities are handing out to City managers is an epidemic problem. City managers are quick to play one locale off against another and exploit the relative lack of sophistication of the City Councils that set their pay. The attached article makes for eye opening reading on the overall problem and possible legislative solutions being proposed.

https://www.highlandernews.org/33593/riversides-city-manager-contract-dispute-wholly-californian-problem/

Read Stu News’ Story – Council raises the ante in Dupuis sweepstakes – here

—-

By : 
Courtesy of the Laguna Beach Independent Newspaper

In her dual job titles as the city’s new assistant city manager and director of public works,

Shohreh Dupuis

Shohreh Dupuis

Shohreh Dupuis knows she’ll encounter the unique challenges of a popular beach town. Experienced at working with regional transportation agencies, her first task will be the utility undergrounding project in Laguna Canyon and the growing traffic congestion on the city’s small streets, she said.

With at least one hurdle that confronts most residents, she will receive help. Dupuis is one of four City Hall executive administrators getting assistance from their employer to buy a home in town, said Gavin Curran, director of finance and information technology.

And that’s a big help, especially in a city that ranks second highest for median home prices in Orange County, according to Core Logic property information company and Oscar Wei, senior economist for the California Association of Realtors. Corona del Mar ranks first.

For more of the story click here

Updated – The Great Laguna Beach Real Estate Giveaway

What do the following have in common:
* City Manager
* Assistant City Manager
* Fire Chief
* Battalion Chief (1)
* Battalion Chief (2)
* Senior Sewer Services Supervisor

If you guessed that all of these folks working for Laguna Beach earn well in excess of $150K per year (base), and in most cases in excess of $250K (total comp), you’d be partially right.

All of these folks have also been the recipients of the largess of the City Council who have deemed them to be “Essential Employees” making them eligible for the City’s “housing assistance subsidy” in which the city agrees to share equally in the PURCHASE of a LB home, (up to 50% equity or less). The logic behind this incredibly generous program is that “essential” employees need to be able to respond to emergencies in a timely manner. There is no formal definition of the program, nor which positions are “essential”, meaning it is up for grabs.

Bear in mind, the City Council believes that these “essential employees” need to reside in or near Laguna Beach, and could not afford to do so on their government compensation. Let’s take a look at the figures for 2015 (since then, all of these positions have received pay increases of at least 3%), as provided by Transparent California (http://transparentcalifornia.com/salaries/2015/laguna-beach/):

Total Pay (without benefits)

  • City Manager –                  $249,912.83
  • Assist City Manager –       $203,104.07
  • Fire Chief –                        $236,056.98
  • Battalion Chief –               $222,996.72

LagunaBeachCHAT finds it to be unreasonable to have the taxpayers contribute more on top of these very generous amounts of compensation (bear in mind, the taxpayers are already contributing approx 30% more for each of these employees in the form of their DEFINED BENEFIT pensions). Its simply largess that no city can afford.

Click here to see 2015 compensation amounts for Laguna Beach’s city & safety employees

What the program means in practice is that the City is co-investor in several properties along with essential employees. Once employment with the City terminates, a participating employee can have up to 10 years to sell the property at which point the City gets its pro-rated share of the proceeds back. The most recent “essential” employee to avail themselves of the program is the new Assistant City Manager (annual base comp of her predecessor in 2015 = $194,239.23), for whom the CC moved in May of 2016 (shortly after her start) as approved by the  City Council:


Moved by Councilmember Dicterow seconded by Councilmember Zur Schmiede and carried unanimously 5/0, authorized the City Manager to:
(a) negotiate an offer with Shoreh Dupuis, Assistant City Manager/Director of Public Works (started with the City, around 1May2016), under the Essential Employee Housing Assistance equity-sharing and direct loan program on the terms and conditions consistent with other employee agreements and with the Agenda Bill;
(b) prepare and execute all documents necessary to implement the transaction with any costs shared equally by the City and the employee; and
(c) appropriate $1.3 million from the proceeds received from the sale of 1044 Noria Way and 1419 Regatta Road toward this transaction and, if necessary until the properties are sold, temporarily borrow from the Insurance Fund to complete the transaction.


Members of the tax-paying public went before the City Council to object to this “perk”, but the plea fell on deaf ears; the City Council continues to approve requests presented by the City Manager unanimously.

The accompanying document shows the agreement that the City made with the then Senior Sewer Services Supervisor, who had at that point (2008) worked for the City for 35 years. He & his wife wanted to stop renting & purchase a property to start building equity. Ultimately this request for “Essential Employee” status was granted and the city contributed up to $400,000 for the purchase of the home. This despite the fact that sewer division employees were already eligible for a monthly housing subsidy from the City at at then-$800 per month.

Recently we became aware that the City Manager refinanced his LB Employee City Subsidy Program partially city-owned home. Due to newer refinancing practices put in place after the housing melt-down, the City eventually gave-up its 50% equity position in the CM’s home, and has instead become the loan holder of the (refinance) note.

City Manager – John Pietig Housing Agreement 2001
More on Pietig FPPC here

City Manager John Pietig’s Laguna Beach Housing Loan Agreement

Battalion Chief – Thomas Christopher Housing 2005

Employee Graham Wright, Sewer Services Supervisor City Housing Agreement 2008

Assistant City Manager Housing Subsidy 2016

Housing Element Agreement 2013-2021-final

Amortization Schedule – Shohreh Dupuis Updated 12/31/20

Dupuis Housing Assistance agreement with all signatures 5-26-16

Housing agreement amendment

Memo Annual Rate 2020 SIGNED

Resident Files Two Sworn Complaints With FPPC* See 24April17 update!

Two sworn complaints have been filed with the Fair Political Practices Commission (FPPC) against Mayor Steve Dicterow for failure to properly disclose reportable economic interests. These sworn complaints have been combined into a single investigation. The first complaint was filed in October 2016 and the second in November of 2016.

Documents: FPPC Case No. 2016 -19821; Steven Dicterow:

First FPPC Complaint and Investigation Acknowledgement Letter November 3, 2016 *
Initial FPPC Confirmation Letter

Second FPPC Compliant and Investigation Acknowledgement Letter of November 29, 2016**
November 29 Letter

Below are the most recent Form 700s filed by Mr. Dicterow {see our Form 700s link for all filings for Laguna Beach elected officials, City employees, Outsourced city-attorney and appointed boards/commissioners}

700-2012_dicterow_steve

700-2013-dicterow_steve

700-2014-dicterow_steve

700-2015_dicterow_steve

*On October 25, 2016 after the FPPC notified Mayor Dicterow that a sworn complaint was received, he responded through local attorney Larry Nokes and amended only the 2016 Candidate Form 700 disclosure leaving the earlier disclosure forms in non-compliance. Worth noting: This amendment was executed seven days after the October 18, 2016 City Council meeting where his failure to report this asset was exposed and Mayor DIcterow discounted the accusation.
Updated Nokes Letter Amended 700 Form

** November FPPC Letter acknowledges second sworn complaint and its inclusion in the open investigation. Awaiting FPPC ruling, which will be posted upon receipt.


On April 24, 2017 the FPPC issued a Warning Letter to Mr. Dicterow as a result of the 2 sworn complaints.  Broadly, the FPPC found that Mr. Dicterow had indeed failed to properly disclose his ownership of non-primary-residence property he owned within his area of influence going back to at least 2012. However, since he immediately filed an amended 2016 Candidate Form 700 once the complaint was filed they believed this was a mere oversight or failure to understand the filing rules.  As for the second complaint, that Mr. Dicterow had failed to disclose income received from a business with current, past, or future operations in Laguna Beach, they failed to find evidence of such operation, and hence he needn’t disclose such income.

LagunaBeachCHAT is satisfied with the decision.  This author (who made the sworn complaints against Mr. Dicterow) believes too, that Mr. Dicterow probably did not materially gain advantage through his position on the City Council with regards to his property in Laguna Woods. But he might have or might in the future and citizens of Laguna Beach deserve to know about his economic interests in this property.  As for the second complaint, this author realizes that he failed to ‘connect the dots’ well-enough for the FPPC to find for that complaint. We still believe that Mr. Dicterow’s ‘unusual’ legal-retainer income for American Computer Optics Inc., owned by a  Laguna Beach resident with occasional business coming before the council, should have been disclosed.  Although the FPPC could not find that ACO conducted business in Laguna Beach (thereby requiring any income derived from this company to be disclosed by Mr. Dicterow), I strongly believe Mr. Dicterow has an obligation to reveal this income arrangement to Laguna Beach’s citizens.

In the end analysis, LagunaBeachCHAT remains concerned and perplexed at how a (now) 5-term City Council member who is by profession, an attorney could have been filing Form 700s for 16 years and fail to understand or worse, feel that accurate disclosures were so trivial, so as not to have understood the filing guidelines and minimum requirements. Rest assured that if we come into additional information with regards to ACO’s operations, or indeed discover any other unreported material economic interest of any of our City council members, we will investigate, and where warranted, file future sworn complaints with the FPPC.

We provide the reader with the FPPC Warning Letter here.