How about Tennessee, where THP sold fake ID "Driver Certificates" marked "NOT VALID FOR IDENTIFICATION" to 400,000 illegal aliens, since they are NOT required to have "Driver Licenses"?
COP. 2. to steal; filch. 3. to buy (narcotics). 4. cop out, a. to avoid one's responsibility, the fulfillment of a promise, etc.; renege; back out. 5. cop a plea, a. to plead guilty or confess in return for receiving a lighter sentence. b. to plead guilty to a lesser charge; plea-bargain." -Random House Unabridged Dictionary
"10% of cops are honest, 10% are dishonest, and 80% wish they were honest." -Detective Frank Serpico NYPD, testimony to the Knapp Commission
Dragonater Note: Only cops are allowed to run cartheft rackets. The mission of cops is to extort bribes from career criminals to license them with immunity for their crimes. Any other criminal is fair game.
Best defense is a locked garage, alarm systems and a bunch of loaded guns. If you need to steal your car/bike back from towtruckers, The Dragonater's experience is to buy a BIG boltcutter, since it's embarrasing to use a $15 Walmart Crapper as 3 cops drive by looking to loot the unlocked gate.
The WAR On Sportbike THIEVES
By Michael Gougis
Part 1
The very first “bait bike” sat on the side of a San Diego County freeway for 11 minutes before a thief pulled off to the shoulder and stuffed it into a van. At that point, Detectives Martin Bolger and Anthony Molina knew they were tapping into something important. But what they have uncovered during slightly less than two years of Operation Knee Drag—a multi-jurisdictional task force operation targeting sophisticated sportbike thieves operating in California’s San Diego County—was more than they expected.
Simply put, the two Chula Vista Police Department detectives have been able to bring to light a highly organized community of brazen, sophisticated thieves responsible for hundreds of sportbike thefts in the San Diego region in the last two years. One guy alone stole more than 200 motorcycles. Working with the Regional Auto Theft Task Force, the pair have also been able to learn when the thefts take place, where they take place, and how many of the so-called anti-theft devices on motorcycles and available on the aftermarket do virtually no good whatsoever.
They’ve found out where the stolen bikes go and how the thieves can steal them so quickly. They’ve tried to educate other law enforcement agencies about the problem, and talked to manufacturers about how easily their bikes can be stolen. They’ve found support from some law enforcement agencies, and resistance to dealing with the issue from others—chasing bike thieves is dangerous, and let’s face it, preventing sportbike theft isn’t exactly a high priority for John Q. Public.
But perhaps most importantly, they’ve put together a demonstration and presentation for law enforcement, the media and other interested parties to show the extent of the problem and how to fight it. It’s an uphill climb. There’s not a lot of enthusiasm among police, they said, for a highspeed pursuit through traffic chasing a vehicle that can outrun any cop car. Bolger and Molina brought their show to the Roadracing World offices, along with a trio of late-model sportbikes to demonstrate how easily thieves can make the bikes disappear. They showed us at the office, in simple detail, how to steal them—and then let us try it ourselves. And it worked. As a (generally) law-abiding citizen, it is staggering and somewhat nauseating to follow a few simple directions—cut this cable, twist these wires, unplug this and plug in that—and realize that I now have the ability to walk up to virtually any sportbike, anywhere, and ride it away in less than a minute.
This article will talk about the thieves, their activities, and how to protect your bike from them.
Bolger is a longtime sportbike rider; his first was one of the original Honda Hurricanes. He and Molina were members of the regional task force, luring car thieves into trying to fence their stolen goods through them. Once they bought the stolen cars, of course, the thieves would be arrested.
What they noticed in mid-2007 was that their thieves were bringing them an increasing number of late-model sportbikes. At the same time, State Farm Insurance’s special investigations unit had contacted Bolger, saying that their payouts for stolen sportbikes were surging. Statistics show that during that period, San Diego County had about the same number of motorcycles stolen as Los Angeles County, which has a population that is three times larger.
“We noticed that a lot of criminals were bringing us sportbikes, and State Farm was asking us to do something,” Bolger says. “I said, before I do anything, I want to look at statistics. I want to…get a feel for the real situation in San Diego County.”
From 2000 to 2005, motorcycle thefts went up 27% a year, and Bolger says that while California had a 41% recovery rate, San Diego County’s recovery rate was 27%. And when it came specifically to sportbikes, the recovery rate was down to less than 12%.
“Looking at all those thefts, we decided that there really was a motorcycle theft problem,” Bolger says.
So they talked to their superiors, but had to do some convincing. Imagine trying to convince your law enforcement agency to cough up money to repair a salvaged sportbike to make it attractive enough to lure a thief into trying to steal it.
“The start of this whole operation was very difficult,” Bolger says. “Imagine the potential liability to a supervisor. Your detectives come to you and say hey, we want to start a motorcycle operation. We want to get sportbikes, ride ’em around, do undercover stuff. And how do you convince your boss that you need a couple thousand dollars to fix up a bait bike?
“You should have seen the reaction. It was basically hell no—you guys are crazy. You’d watch their heads explode. But we did a lot of trying to get over some of those issues. And eventually they took a leap of faith in us—and I applaud them for it. When they see who they are really dealing with (organized gangs), that’s when we get the thumbs-up.”
One of the first ideas they came up with was the “bait bike”—a late-model sportbike left on the side of a freeway. As noted, the first bike was stolen in 11 minutes. Fortunately, officers from the task force swooped in and grabbed the bike and the thieves.
And so they started their infiltration of the sportbike theft community in San Diego County.
Part 2
This is what they found:
First, only an amateur thief will resort to punching out an ignition lock. The three most commonly stolen sportbikes—Suzuki GSX-R, Yamaha YZFR6 and Honda CBR, 600 and 1000s alike—can be stolen quickly with virtually no visible physical damage to the motorcycle. Damaging a motorcycle while stealing it reduces its resale value and makes the thief less money.
It does not take sophisticated tools to steal a modern sportbike. An R6 can be stolen with an Allen wrench and knowledge of the wiring system—and that’s only if the thief wants to spend the 45 seconds unscrewing the necessary body panel, instead of just breaking it off in a second or two. Most of the stolen motorcycles are ridden away from the scene. While more and more thieves are using “shoeboxes”— slang for any vehicle that can hide a bike—to transport their stolen booty, the majority are simply ridden off. And once the engine has started, the motor cycle is gone—end of story.
Many agencies have restrictions on pursuits that make it virtually impossible to catch a truly committed thief who will not pull over. And if having a motorcycle stolen is bad, having an officer or bystander killed while trying to recover that bike is infinitely worse.
In San Diego County, stolen bikes go straight across the border. Once into Mexico, the thieves—operating with some of Mexico’s most sophisticated criminal organizations—are paid between $500 and $2000 for each bike. The motorcycles are crated and shipped into the interior of Mexico, or elsewhere into Central or South America. Or their VINs are changed and they are brought back into the U.S. to be re-sold. (Incidentally, the technology for changing VINs has improved dramatically, and it is extremely diffi cult to detect an altered VIN—or Vehicle Identification Number—merely by looking.)
The thieves themselves have a tight-knit community throughout which information about how to steal—“rip” is the slang term—motorcycles is disseminated. Among that community, great care is taken to make it as difficult as possible to track down the thieves. For example, Bolder and Molina said, in one group (they have identified about 144 operating thieves in San Diego County, working in about 55 groups) they use cash-andcarry mobile phones to communicate with each other. Every week, the phones are changed, so tracking phone calls is difficult.
Most thefts occur during normal business hours. In part, this is because that is when most motorcycles are accessible to thieves. The hardest bike to steal is one that’s in a locked personal garage. Few of us get to lock our bikes in places like that during business hours. “Secured” garages at work usually aren’t; The guards usu- ally aren’t patrolling to catch a thief in the act of starting the bike, and once it’s started, the theft is complete. Thieves exchange information about where to hit; which apartment complexes, which garages. They rarely just go out to steal any old motorcycle. But a good thief can see a target of opportunity and, using a cell phone, stand right next to a targeted bike while on the phone with the buyer. If the buyer’s interested, the theft can happen right then. Some thieves keep the necessary tools on them at all times—and unless an officer knows what to look for, the tools will appear completely innocent. (By the way, rashed-up bodywork makes a motorcycle less attractive to you, but it’s also less attractive to the sophisticated thief.)
Part 3
Here are some of the things that Bolger and Molina found did very little to even slow a thief:
Ignition (a.k.a. fork or steering) locks: The stainless-steel pin that extends from the ignition lock into a boss on an aluminum frame can be easily defeated by yanking on the handlebars, (breaking the pin out of the aluminum boss) and when the bad guys do defeat it, the frame headstock is damaged. The locked ignition may deter some thieves. But if it doesn’t, even if you get your bike back, it has damage that requires a frame replacement to properly rectify. This makes your insurance company nuts.
Cable locks: You may as well have “warm butter” securing your wheels, Molina says. Most padlocks: There are very few that can stand up to a 42-inch bolt cutter. There are a few, particularly some Kryptonite locks, that will; most others will give up on the first attempt.
GPS and locating devices: As motorcycles get smaller and smaller, there are fewer and fewer places to hide such devices. So the thieves know where to look; as one thief told a task force member about a stolen bike, “It doesn’t have a LoJack. I checked all three places.” And when the task force began operating, thieves would steal bikes and park them in locations near the U.S.-Mexico border for a couple of days to see if law enforcement was able to track the motorcycle down. “They would tell the crooks, do not ever bring me a fresh-stolen motorcycle. I don’t want Tijuana police coming into my business,” Bolger says fences told thieves.
However, a little more than a year ago, one of Mexico’s major crime cartels demanded a piece of the motorcycle theft industry’s proceeds. In exchange, the cartel protected the chop shops from law enforcement. “Because of that, everything changed. Now we rarely see a GPS ping in San Diego. Now, when a motorcycle is stolen, it goes right across the border,” Bolger says. “Mexican law enforcement now is having a very tough time. Police officers, chiefs of police, they’re all getting killed. They’re not interested in trying to recover stolen motorcycles. They could die. It’s not worth it to them. We see motorcycle (GPS) pings there in Tijuana all the time.”
Part 4
Here are some ways to detect stolen motorcycles and those who are stealing them:
Bypassed ignition: A stolen motorcycle—one with a defeated ignition—is usually operating without a key. If a motorcycle is being refueled with its headlight on, ask: How is the headlight on when the key was needed to open the gas tank? Answer: The ignition was bypassed. Stolen GSX-Rs have a “pigtail”—a secondary, prepared bypassed ignition that usually is found lying along the left side of the fairing. That is a clear indication that the bike is stolen. Stolen YZF-R6 Yamahas have a missing black beauty panel under the left clip-on.
Unusual helmet: Thieves often use whatever helmet is available. So it is not unusual to see stolen motorcycles with a rider wearing a dirtbike helmet. Bike thieves also tend to steal helmets merely by cutting off the strap from a helmet lock. So if the chin strap is flapping in the breeze, it should be a warning sign for law enforcement.
No license plate: Motorcycles without license plates being transported in the back of a pickup truck could be suspicious. A sportbike on its side in a pickup truck bed is a big red flag.
Part 5
The best way to keep your motorcycle yours is to be creative. Install a kill switch, but hide it somewhere that it cannot be easily found. And use multiple lay ers of security; locks, alarms, and locating devices work best when used together. Consider buying a cheapo cell phone and popping for the GPS monitoring feature. A thief may overlook a cell phone as a potential tracking device. The best bet is to scare off the thief before he or she decides to steal your bike. Again, once the bike is started, it’s gone. The odds of getting it back, in useable condition, are not good.
The task force has had some significant successes. In 2008, sportbike thefts in San Diego County dropped nearly 20%. And some of the most prolific thieves have been put out of business. Word has gotten out among the thieves that the modern sportbike that’s just sitting there, looking like it’s too easy to steal, just might be one of the team’s “bait bikes,” and the minute they start trying to steal it, they’ll be taken down.
Perhaps the most significant impact of Operation Knee Drag, however, might be the increased awareness of the crime. Bolger and Molina said they have been working hard to educate their law enforcement counterparts, and for good reason. If law enforcement isn’t aware of the problem, little will be done to fight it. The pair have video of a clueless patrol officer pulling up behind a stolen bike in a gas station (the officer’s not really clueless, task force members are broadcasting the bike has been stolen) and then just watching as the thief gets back on the bike, starts it and rides off. The officer didn’t know what to do, or what to look for.
It’s an incredibly tempting crime. Law enforcement is relatively unaware of how it takes place and isn’t enthusiastic about chasing a highspeed missile through traffic across an international border. The bad guys know that the rewards are high, the risks low. The best solution is prevention. RW What To Watch Out For
(Or, How The Bad Guys Are Stealing Your Bikes)
AFTER AN OPERATION KNEE DRAG PRESENTATION, ROADRACING WORLD WENT ONLINE TO RESEARCH HOW MUCH OF THE INFORMATION ABOUT HOW TO STEAL A BIKE WAS ALREADY AVAILABLE TO SOMEONE WHO WANTED TO STEAL A BIKE. WE WERE ABLE TO EASILY FIND VERY SPECIFIC INSTRUCTIONS ON EXACTLY HOW TO HOT-WIRE THE YZF-R6 AND THE CBR. INSTRUCTIONS ON BYPASSING THE IGNITION ON A GSX-R WERE NOT AS SPECIFIC, BUT IF YOU WERE LOOKING FOR A WAY TO DO IT, THE INFORMATION WAS OUT THERE, JUST NOT AS NEATLY PACKAGED AS THE INFORMATION FOR THE R6 AND CBR.
Based on what we found, we made the editorial decision to illustrate how simple it is to bypass the ignition on many late-model sport bikes. We’re not doing it to help the thieves; they already know how to do it. And what we’re publishing is well-known among many racers (who remove keyed ignition switches from racebikes routinely) and mechanics.
Our purpose here is to push the motorcycle manufacturers into re-thinking the anti-theft systems on their bikes. Some changes would be simple and virtually free; relocating some wires or plugs would help significantly. And sometimes it would simply be a matter of incorporating some anti-theft devices that are installed on the same models sold elsewhere in the world, like immobilizer systems that must match a chip in the key with a chip in the ignition black box before the bike will start. Yes, it may raise the price of the U.S. model. But it may also lower the insurance premiums.
Lastly, what you see here will help you identify a bike that has had the ignition bypassed. As a racer, the need for cheap parts is obvious. But buying stolen parts hurts everyone in the motorcycling community, and buying parts from a stolen racebike is unconscionable. If it seems too good to be true…
Part 6
Ignition Steering Lock (All Makes)
Engaging the ignition steering lock pushes a stainless steel pin into a boss or depression on the steering head of the frame, thus preventing the bars from turning. However, the pin usu ally does not protrude deeply into the boss or depression on the head stock, the aluminum frame material is not hardened and the fit of the pin into the steering head stock is not precise, allowing the bars to move slightly, even with the pin engaged. By standing in front of the bike, grabbing the left handlebar, placing your right foot on the left peg for leverage and yanking (pulling) the bar to the right, you can force the hardened pin to shear through the boss or depression on the steering head. Potential solution: Redesign the ignition steering lock to engage the frame at a different location, or harden the boss on the head stock where the pin is inserted.
Ignition Bypass (Honda CBR600RR And CBR1000R) These models of Honda sportbikes have a pair of wires heading into the ignition; some years the wires are on the left, others on the right. In either case, the wires (usually encased in plastic tubing) can quickly be cut, stripped and twisted together, at which point the electrical system of the motorcycle comes alive. A push on the starter button starts the engine. Potential quick solution: Re-route the wires so they are not accessible, or include an immobilizer-type device in the circuit.
Ignition Bypass (Suzuki GSX-R) Suzuki uses the same ignition lock assembly interchangeably on its GSX-R sportbikes from year to year and model to model; for example, the part number for the lock assembly is the same for the 2007 and 2008 GSX-R1000, and is the same for the 600cc, 750cc and 1000cc versions of 2008 GSX-R sportbikes. The lock is attached to the wiring harness via a plug positioned over the radiator, and it is easily accessible by hand from the outside of the bike. Thieves merely arrive at the target bike with an ignition lock assembly from another GSX-R (with the key already in the lock and set to the run position) and unplug the ignition on the bike. They plug in the pre-set ignition and the bike fires. Potential quick solution: Relocate the connecting plug elsewhere on the bike. Tucking it well up under the tank would make it significantly harder to reach and would slow down the ignition swap. Or include an immobilizer-type device in the circuit.
Ignition Bypass (Yamaha YZF-R6) The Yamaha YZF-R6 has two pairs of wires that usually run under the black bodywork panel under the left clip-on. The wires are connected via quick-disconnect plugs to the ignition lock assembly. Thieves typically take the 30 seconds or so required to remove the bodywork panel without damaging it—it’s a matter of unscrewing two Allen bolts, and an undamaged bike brings more money when sold—and disconnect the two plugs. Thieves trade among themselves a pre-bypassed set of the plugs that, stock, are wired into the ignition. By cutting a set of the plugs off an ignition lock, twisting the pairs of wires together, and plugging the bypassed plugs into the wiring harness, the ignition is bypassed. The target bike will then start. This is, incidentally, exactly what the racing harness for the R6 does, and it is commonly known among R6 racers that this method can allow the racer or track-day rider to remove the keyed ignition lock. Potential solution: Once again, re-route the wires so they are harder to access, and put the plugs someplace where they cannot be reached quickly. Or include an immobilizer-type device in the circuit. RW
If the steering lock pin tears through the head stock, the only real fix involves replacing the frame on the motorcycle. Photo courtesy San Diego County Regional Auto Theft Task Force.
Spotted at a local college parking lot: A brace of nicely customized GSX-Rs, no locks on the wheels, no alarms; hidden from sight of the main campus by a huge shipping container. Working in relative seclusion, it would take a couple of prepared thieves less than a minute to ride off with both of these. Photo by Michael Gougis.
Even easier to tear through is a raised boss for the steering lock, as shown on this Honda CBR1000RR. Photo by Brian Bourgeois.
Typical tools of the trade: Helmet law in California means the bad guys carry a helmet with them on heists. For many bikes, the wirecutters and the electrical tape are all that are necessary to get them started. Photo by Michael Gougis.
Locks deter the amateur thief. But most locks can be defeated, if through nothing other than brute force. Here a motorcycle lock’s remnants were found in a minivan used to transport a stolen motorcycle. Photo courtesy San Diego County Regional Auto Theft Task Force.
For a Yamaha YZF-R6, these two plugs are the ones that need to be short-circuited. It can take a moment or two, so the bad guys come to the crime scene armed with a set of short-circuited connectors. If they’re in a real hurry, the bad guys will just rip off the bodywork piece that covers these plugs; most of the time, though, the better the shape the bodywork is in, the more the bike will fetch on the stolen goods market.
Missing in this article is the fact that many bikes are stolen out of private garages only a few weeks after buying them. So unless the thief spotted it on the road and followed it all the way home (doubtful), they are hacking into the databases of dealerships or insurance companies to find buyers of new bikes.
As for locks, buy a chain with links at least 14mm cross-section (can't be cut by anything except a plasma cutter), and put it through your swingarm, not just the wheel.
How about rigging your alarm to a HID ballast and running wire around the grips? Down side is they'd drop your bike...
Also, most alarms come with ignition kill...in fact my buddy's bike won't start at all without the remote being close. I'm not saying that an alarm is a foolproof method to protect your bike but I'm just really surprised that they don't mention it.
If, as the article states, the more sophisticated thieves are using a "plug & play" pig-tail to bypass the ignition, that alarm system maybe useless (depends on how it's wired).
I run a simple solution, that can be adapted in several different ways. On my Duc, I've wired a hidden toggle switch into the fuel pump wiring. You can hook up all the pig-tails you want, but if you can't find that switch, you ain't riding my bike anywhere. You can also wire sidestand and clutch switches to do the same thing.
None of those things will keep a determined asshat from tossing your bike into the back of a van, but they will give you a chance to shoot them.
OKLAHOMA CITY -- The woman who made national headlines for her near-naked protest at the airport in Oklahoma City is back and once again banned from flying.
A YouTube video put Tammy Banovac in the national spotlight. Banovac says she went through security wearing next-to-nothing, to protest new security rules at airports nationwide.
12/01/2010 Related Story: Woman Strips Down To Bra, Panties At OKC Airport To Protest TSA Pat-Downs
Banovac was back at the Will Rogers Airport Tuesday and once again, security says she can't board her flight back home to Phoenix.
Last month security denied her access because they said they found traces of nitrate somewhere on her body.
Now, it's something near her bottom that is raising a red flag.
"The stated reason was there was... They were unable to clear an unusual contour of my buttocks area," said Banovac.
"Amerika has become the laughingstock of the world, and I helped," bragged Hussein Obama Soetoro. "Hell, I'm not even a US citizen and I get to smoke pot and snort crack every day in the White House. It's great to be the Dictator!"
I was about to delete an offensive comment on this blog – one of the very few we get – and thought, hmm, I wonder where this guy is posting from? Because, really, it is quite unusual for us to get nasty comments. Lo and behold, the troll posted to our website from an IP address controlled by the federal government’s Department of Homeland Security! Here is the taxpayer-funded troll’s gem of a comment, for your entertainment:
In fact, there are are 19 comments from that IP address in our comment database! Here are some choice ones:
A pilot based at San Francisco International Airport has resigned from an anti-terrorist program that allows him to carry a gun onboard after he posted behind-the-scenes videos on the Internet showing what he considers lax security procedures for airport ground crews.
The pilot, a Sacramento-area resident in his 50s who has not released his name or airline, has been the target of a Transportation Security Administration probe since federal officials discovered the YouTube videos Nov. 30. The videos, which the pilot took with his cell phone, have since been taken down.
But snippets of the recordings the pilot gave to a Sacramento-area television station show that SFO workers on the ground are given access to passenger-restricted areas by swiping a security card. He claims their belongings and any cargo they are transporting are not checked, and there are no guards at the door.
"As you can see, airport security is kind of a farce," the pilot said in one video. "It's only smoke and mirrors so that you people believe there is actually something going on here."
Other footage shows him holding a large axlike weapon stored in the cockpit.
His attorney, Santa Ana-based Don Werno, said the pilot posted five similar videos on YouTube before authorities asked him to take them down. The sixth and final video he recorded featured four U.S. air marshals and two local sheriff's deputies visiting his home to take away his federally issued firearm as part of an ongoing investigation.
A letter the TSA sent the pilot, which Werno provided with his client's name redacted, said the Federal Air Marshals Service was suspending him as a federal flight deck officer pending a review.
The U.S. government created the flight deck officer program after the Sept. 11, 2001, terrorist attacks to allow qualified pilots and other onboard personnel to carry firearms during flights and receive training from air marshals, enabling them to help protect against attacks.
The man will continue serving as a pilot, since the flight deck officer role is voluntary and doesn't come with any perks, said Werno, who noted the video was meant as a wake-up call.
"This is what he believes is a major national security problem," Werno said Friday.
It's unclear if the TSA investigation now becomes moot, since Werno said the pilot already resigned from the program. The letter said that release of sensitive information "may result in civil penalty or other action."
In a statement released Friday, the TSA said it took action because federal flight deck officers "must be able to maintain sensitive security information as a condition of the program."
The agency said that, because it issues the firearms and credentials as part of the program, it reviews each possible violation and "acts accordingly, up to and including removing an individual from the assigned role."
"As to access control at SFO, TSA is confident in the tools the airport has implemented and reminds passengers there are security measures in place that are both seen and unseen," the TSA statement said.
Still, critics of the agency claim the videos shine a light on what they say are holes in the security system.
"I believe these are brave maneuvers in order to expose the frailties that exist regarding TSA," said Kate Hanni, executive director of Flyersrights.org, who called the TSA reaction to the video ridiculous. "The TSA simply does not want anyone to know how ineffective they are."
Pilot points out known airport security flaws – big brother TSA Pounces http://www.mercurynews.com/san-mateo-county/ci_16932815?nclick_check=1 http://www.news10.net/news/story.aspx?storyid=113529&catid=2 http://radioviceonline.com/pilot-points-out-known-airport-security-flaws-big-brother-tsa-pounces/
Huckeby, Randall D
Department: TN DEPT OF SAFETY AT DEALS GAP
Class Title: THP SERGEANT ON THE DRAGON
Current hourly rate: $28.89
FY 2007-08 salary: $60,084.00
Overtime dollars: $10,181.87
Total = $70,265.87
(not counting overtime for testilying in court, not counting private part-time employment for "security", nor double-dipping military deployment as MSGT while on police salary, nor benefits) 1,500 tickets per year, #1 Ticket Writer in Tennessee? 14,700% increase in THP tickets on the Dragon
"About 200 union sympathizers waved signs and cheered Wednesday as speakers denounced Republican-sponsored legislation that would curb collective bargaining and political activities of public employee associations and unions. Participants included members of the Tennessee Education Association, Professional Fire Fighters Association, Fraternal Order of Police."
-Knoxville News Sentinel, Union sympathizers decry legislation, February 24, 2011
COP.
2. to steal; filch. 3. to buy (narcotics). 4. cop out, a. to avoid one's responsibility, the fulfillment of a promise, etc.; renege; back out. 5. cop a plea, a. to plead guilty or confess in return for receiving a lighter sentence. b. to plead guilty to a lesser charge; plea-bargain.
-Random House Unabridged Dictionary
Tennessee teachers call it an attempt to silence their voices, but supporters of House Bill 130 say it's a way to help balance local budgets.
The controversial legislation would strip teachers of the option to collectively bargain for salaries, working conditions, and benefits. It would also allow school districts to reduce the percentage of money they pay for teachers' health insurance premiums.
If every district made the maximum reduction, the bill’s fiscal note projects local governments would save a combined $16 million or about $600 per teacher.
“We all love teachers, we need our teachers, and we need to support our teachers, but we need to get rid of collective bargaining,” Northeast Tennessee/Kingsport Tea Party Organizer Britt Buehrig said.
Buehrig spent his weekend in Nashville rallying with other Tea Party members in support of the legislation.
“We’re supporting Pennsylvania, Wisconsin right now,” Buehrig said. “Tennessee also has a budget deficit. We need to meet it. We can meet it by curtailing some of the benefits that teachers are receiving. The counties and school districts can negotiate contracts that they can afford, because right now the state is going bankrupt."
Johnson City Schools Director of Finance Pam Cox crunched the collective bargaining numbers in her school district. She doesn’t see the savings.
“(Collective bargaining helps) us set our priorities if you will,” Cox said. “(It doesn’t) necessarily cost us any more money. I don’t know that we spend any more money because we bargain. I think how we spend our money may be a little different, but even saying that, I don’t think it’d be tremendously different if we didn’t bargain.”
Although the bill could save local governments millions, that’s only if every school board decided to crack down on teacher benefits. Cox doesn’t see that happening in Johnson City and in other parts of Northeast Tennessee.
“We have a goal to keep our teachers paid well,” Cox said. We have a goal to make sure that insurance is as good as possible and as inexpensive as possible. Unless school boards just come in and decide we're going to balance our budget on the backs of our employees, then I really don't see how it's going to save you money,” Cox said.
A House subcommittee is set to hold a hearing on the bill Wednesday. The full Senate is expected to vote on the legislation Thursday.
AN ACT to amend Tennessee Code Annotated, Section 5-
23-107 and Title 49, relative to the Education
Professional Negotiations Act.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Title 49, Chapter 5, Part 6, is amended by
deleting the part in its entirety.
SECTION 2.
(a) On or after the effective date of this act, no local board of education shall
negotiate with a professional employees' organization or teachers' union concerning the
terms or conditions of professional service.
(b) Nothing in this act shall be construed to abridge or impair a contract or
agreement governing terms and conditions of professional service entered into by a
board of education and a recognized professional employees' organization under the
Education Professional Negotiations Act before the effective date of this act. Any such
contract or agreement shall remain in full force and effect until the expiration of the
contract or agreement. Upon the expiration of a contract or agreement negotiated by a
board of education and a professional employees' organization, teachers employed by
such board of education shall have the rights in their employment that are afforded to
them under state law and the personnel policy applicable to them.
SECTION 3. Tennessee Code Annotated, Section 5-23-107(1), is amended by deleting
the language "or negotiated agreement pursuant to title 49, chapter 5, part 6".
SECTION 4. Tennessee Code Annotated, Section 49-1-201(d)(2), is amended by
deleting the subdivision in its entirety.
SECTION 5. Tennessee Code Annotated, Section 49-1-207(g), is amended by deleting
the subsection in its entirety.
SECTION 6. Tennessee Code Annotated, Section 49-1-614(d)(2), is amended by
deleting the language ", and the Education Professional Negotiations Act, compiled in chapter 5,
part 6 of this title,".
SECTION 7. Tennessee Code Annotated, Section 49-2-301(b)(1)(EE), is amended by
deleting the subdivision in its entirety and by substituting instead the following;
In the approved budget and consistent with existing state laws and board
policies, employ, transfer, suspend, nonrenew and dismiss all personnel, licensed or
otherwise, except as provided in § 49-2-203(a)(1) and in chapter 5, part 5 of this title.
SECTION 8. Tennessee Code Annotated, Section 49-3-306(h), is amended by deleting
the language "and in compliance with § 49-5-611".
SECTION 9. Tennessee Code Annotated, Section 49-5-5012, is amended by deleting
the section in its entirety.
SECTION 10. Tennessee Code Annotated, Section 49-13-118, is amended by deleting
the section in its entirety.
SECTION 11. Because title 49, chapter 5, part 6, shall continue to be applicable to
contracts or agreements governing terms and conditions of professional service that were
negotiated and entered into by a board of education and a recognized professional employees'
organization before the effective date of this act, the code commission is requested to place the
Education Professional Negotiations Act together with an appropriate statement indicating its
applicability in an appendix to title 49 for the sole purpose of providing a readily available
reference for those affected by such contracts or agreements until the time that all contracts or
agreements negotiated under the act have expired.
SECTION 12. This act shall take effect upon becoming a law, the public welfare
requiring it.
A chorus of conservative pundits are calling for bankruptcy laws to be changed so that all 50 US state governments might have the chance to restructure their debts, an ability currently limited to corporations, municipal entities, and private citizens.
"Many states, including those with the country’s largest population centers, are now on a path to insolvency," Grover Norquist. anti-tax activist, wrote in a recent Politico editorial.
He continued, "This is primarily due to fiscally promiscuous lawmakers, skyrocketing Medicaid costs and unsustainable gold-plated government employee pension plans that most Americans could never dream of."
Like Norquist, David Skeel in the Weekly Standard marked the state of California at the top of the hit list due to its possible $25.4 billion deficit next year.
"Although bankruptcy would be an imperfect solution to out-of-control state deficits, it’s the best option we have, at least if we want to have any chance of avoiding massive federal bailouts of state governments," Skeel wrote in November.
Crooks and Liars' karoli noted, however, that California's "promiscuous" lawmaker - Republican Gov. Arnold Schwarzennegger - has refused to use other tools at his disposal to raise state revenues.
"Arnie has now been governor of this state for half of (Democratic Gov. Gray) Davis' term and then one of his own," karoli wrote. "In that time, he has vetoed any effort to get oil companies to pay their fair share of taxes in this state, he has slashed programs to the bone, and the 'fat pensions' are ones beefed up by the likes of the Bell City Council, not ordinary employees."
karoli said that the conservative call to give states the power to declare bankruptcy is merely a new attempt to destroy public employee unions.
"In conservatives' worlds, the mismanagement of state finances should be on the backs of teachers, policemen, firefighters, and public employees," she wrote.
Public employee unions are historically allied with the Democratic Party; however, given the ease by which President Barack Obama froze pay for federal employees, the federal law banning state bankruptcies could be on the table.
"From the Republican perspective, the fiscal crisis on the state level provides a golden opportunity to defund a key Democratic interest group," James Pethokoukis, the Money & Politics columnist for Reuters Breakingviews, wrote earlier this month.
"For the GOP, it’s an economic and political win," he concluded.
Skeel, a bankruptcy expert at the University of Pennsylvania, said that bankruptcy could give states the tools with which to "play hardball" with not only unions but also bondholders.
"Ideally, bondholders would vote to approve a restructuring," he wrote. "But if they dug in their heels and resisted proposals to restructure their debt, a bankruptcy chapter for states should allow (as municipal bankruptcy already does) for a proposal to be 'crammed down' over their objections under certain circumstances."
Skeel continued, "This eliminates the hold-out problem — the refusal of a minority of bondholders to agree to the terms of a restructuring — that can foil efforts to restructure outside of bankruptcy."
New York benefits emblematic of national government crisis
Health care and pension benefits for state and local government employees are out of control, experts are telling WND, and a new study by a think tank points to New York City as being emblematic of the fiscal crisis.
Taxpayers in the Big Apple are forced to pay $144,000 a year for salary, health and pension benefits for garbage workers, who are unskilled but unionized laborers.
Research by the Manhattan Institute, a think tank in New York, shows that when Mayor Michael Bloomberg took office after 9/11 the city increased spending on garbage workers' salaries by three and a half times the rate of inflation every year, growing the sanitation department budget from $1.3 billion a year to $2.2 billion.
Get Rep. Devin Nunes' "Restoring the Republic" autographed – only in the WND Superstore.
The budget increased despite the reduction in force of the overall garbage collection staff by 4 percent; and the same kind of disturbing fiscal trend is slowly being disclosed by other cities and states, experts tell WND.
Dramatic cuts in overall compensation are required for states and municipalities to simply survive, they conclude.
"Reducing state and local government costs requires them to shift to retirement plans that are affordable, predictable and fair to both employees and to taxpayers," said David C. John, a senior research fellow at the Heritage Foundation, a think tank in Washington, D.C. "Current employees will object, but officeholders have a responsibility to the taxpayers to stand up to that pressure."
Other experts agree but note that part of the problem is inept financial planning by the government, not just excessive spending.
State governments in the U.S. have an aggregate of pension liabilities exceeding $3 trillion. Politicians assumed an 8 percent return on the pension fund investments when they signed contracts with the public employee unions a decade ago.
Stocks – per the S&P 500 – are, however, negative for the last decade and many fixed income investments relied on by government pension funds are generating nowhere near 8 percent.
According to Robert Novy-Marx, a professor at the University of Rochester's Simon Graduate School of Business, states are either making up for the weak investment returns by contributing more money to the pension plans through increased taxes, or they are going to have to reconfigure the plans to cut benefits.
New York City isn't the only body politic in deep trouble, as California and Illinois are essentially insolvent, too, Novy-Marx's research shows.
According to the Manhattan Institute, the costs are soaring, but pensions aren't the only cost. Health care benefits for these unionized civil servants are extraordinary.
A decade ago, health care benefits for the department cost $150 million; they have since more than doubled to $313 million. Overall, taxpayers in New York City today spend $144,000 yearly for each garbage worker, up from $79,000 a decade ago. What's more, taxpayers spent about $10.5 million annually to fund sanitation workers' pensions. This year, it will cost $240 million – a more than 20-fold increase.
Contracts Clause
But trimming bloated budgets isn't as simple as it may seem, experts tell WND. The unions are going to insist they have a constitutional right to have their contract fulfilled.
"If local governments try and cut pensions that have vested, on the states' own initiative, without first going bankrupt, the public employee unions will claim that violates the Contract Clause of the Constitution," Hans Bader, a senior attorney at the libertarian think tank the Competitive Enterprise Institute, told WND.
The Contract Clause appears in the United States Constitution, Article I, section 10, clause 1, and states:
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
The Contract Clause, thus, prohibits states from enacting any law that retroactively impairs contract rights, such as defined benefit pensions and health care policies. The Contract Clause applies only to state legislation, not court decisions, however. So there is a solution in federal court.
"Local governments that are running out of money and are willing to go bankrupt could probably wipe out the pensions if they really wanted to," said Bader.
Alternatively, Bader said, the Republican House, which just overturned President Obama's health-care reform could impose a tax for excessive pensions and benefits on those local and state government workers, and refund the monies to their troubled states and municipalities.
"Liberals like excess profits taxes levied on oil companies," Bader told WND. "Why not take a page out of their playbook and impose an excess profits tax on public employees?"
Jerome Corsi's Red Alert earlier reported such unfunded liabilities are forcing many states to hike property taxes.
For example, New Jersey has disclosed that the unfunded pension liability for state government employees grew from $45.8 billion to $53.9 billion in 2009, an increase of 18 percent.
WND previously reported three GOP members of Congress introduced the Public Employee Pension Transparency Act, which would require states to disclose publicly the true size of their unfunded pension liabilities and also would prohibit any future public pension bailouts by the federal government.
The lawmakers also say the unfunded state pension liabilities may exceed $3 trillion.
Sketching out a worst-case scenario of San Jose's budget meltdown, city officials warned this week that they could lay off as many as 349 police officers and 145 firefighters, slashing close to a quarter of the city's public safety employees.
The city is also looking at millions of dollars in other cuts, including shutting off neighborhood streetlights for much of the night and eliminating some gang-prevention programs.
There has never been a major layoff of police officers in the city's modern history. But last year San Jose laid off 49 firefighters, and this is the second year in a row the Police Department has faced layoffs.
The apocalyptic scenarios presented at preliminary budget sessions this week are based on the assumption that the city won't extract concessions from public employee unions. But it's now clear that even with concessions, the layoffs will be severe.
City officials say the looming $110 million deficit projection is very real and must be made up through a combination of layoffs, concessions, program cuts and pension reform.
"I think it is inevitable there will be significant cuts," said Tom Manheim, a spokesman for the city manager's office. "We don't know how large the numbers will be. And more importantly, we don't know where the City Council will make those cuts."
The final decisions on layoffs are expected to be made during council budget sessions in June.
Manheim said that even if all 11unions agree to 10 percent concessions in total compensation, which includes salary and benefits, the Police Department could still lose 237 positions, while firefighters could lose 82.
Citywide, nearly 600 positions are potentially on the chopping block, he said.
Cutting the Police Department down to about 900 sworn officers would bring the department to staffing levels the city hasn't seen since the mid-`80s, when San Jose's population was about 700,000, about 300,000 less than it is today.
"It's too early to see exactly what will be played out," police Chief Chris Moore said. "But just having the discussion of cutting 350 officers certainly caused us great concern."
Would fewer cops mean less public safety?
"Of course it would," said Sgt. Jim Unland, vice president of the police officers union. "At some point our elected officials have to say `No more.' A city's No. 1 priority is to provide public safety for its citizens. No reasonable person would try to make the argument that 900 cops is enough to do that for a city of 1 million people."
Unland said that the cuts would mean it would take police longer to react to emergency calls, a much smaller traffic unit, fewer detectives to solve violent crimes and fewer special units to find and catch violent criminals.
In refocusing its limited resources, police may also have to stop investigating property crimes such as car thefts and burglaries.
The San Jose Fire Department has 650 full-time employees, so a reduction of 82 firefighters would reduce its ranks to 568.
Last year, the department laid off 49 firefighters after the city couldn't secure sufficient concessions from the firefighters union to save those jobs.
The police union avoided layoffs, however, by making more concessions than the firefighters.
Jeff Welch, president of San Jose Firefighters Local 230, said in a statement Tuesday: "The negotiation process has just begun and we're committed to working with the city on a combination of salary concessions, significant pension reform and operational efficiencies that will protect service levels for the community and save taxpayer dollars."
Under a budget-balancing scenario presented Monday to the council, city officials also proposed turning off some neighborhood streetlights from 11:30 p.m. to 5 a.m. In addition, library branch hours could be reduced from 4.5 days a week to three days a week, and two of 10 community center hubs could be closed. General fund dollars spent on the city's pavement maintenance program would be axed, and the park ranger program would be eliminated.
Mayor Chuck Reed and City Council members said Tuesday that concessions were needed to save vital jobs. And some elected officials noted that about half the deficit is due to skyrocketing employee pension costs.
"The reason we're asking for a 10 percent cut (from the public safety unions) is that we're trying to save the jobs of police and firefighters," Reed said. "The retirement costs alone for police and firefighters add up to $45 million next year. " ... The cuts we're asking for will not cover it, but they will cover part of it."
Councilman Pete Constant, a former San Jose police officer, said: "It's really important that all of our city's unions - especially police and firefighters - understand the impact of the concessions we're asking for. If they're unable to make the concessions, then we'll have to face cutting up to 350 police officers, and I don't know how we'll have the ability to protect our residents."
In a speech before the United States Chamber of Commerce, JPMorgan Chase Chairman and CEO Jamie Dimon told the audience:
"I wouldn’t panic about what I’m about to say. You’re going to see some municipalities not make it. I don’t think it’s going to shatter America, I just think it’s a part of the credit cycle."
He went on to say that some municipalities will need to renegotiate their debt and it will be hundreds of them that may “not make it.”
Analyst Meredith Whitney has been essentially warning about the same thing but has been under attack for her comments from the muni bond industry and has faced extensive repeated attacks for her view in columns by FOX reporter Charlie Gasparino.
Cops get $200,000 salary, force cities to file bankruptcy - If Vallejo was to declare bankruptcy, it would be the first city in California history to do so. Orange County went through bankruptcy procedings in 1994. Gomes largely blames what she calls exorbitant salaries and benefits for Vallejo firefighters and police officers. Gomes said that last year, 98 firefighters made more than $100,000 and 10 made more than $200,000 including overtime. Every full-time Union City firefighter earned more than $100,000 last year and the Fire Department accounted for nearly half of all city employees earning six figures, according to city data. Citywide, former police Chief Randy Ulibarri made the most money in 2006 with $220,256, followed by City Manager Larry Cheeves with $212,730. Rounding out the top five were Battalion Chief Ronald Oatis, $196,040; Battalion Chief Michael Brown, $191,721; and police Capt. Greg Stewart, $189,747. The Argus requested Union City's salary figures for calendar year 2006 last month after the California Supreme Court ruled that governments must reveal what they pay employees. Of about 305 full-time city employees, 98 earned more than $100,000 last year, said Rich Digre, who oversees the city's budget. The Fire Department accounted for 42 six-figure earners, compared with 35 for the Police Department. For sworn Union City police officers who made at least $70,000 in base salary last year, the average salary was $105,250 and the average overtime earnings was $8,204. Their counterparts in Fremont averaged $124,226 in total salary and $12,760 in overtime. In Fremont, average pay for firefighters was $137,404, and average overtime pay was $29,242.
Cop, firefighter pension bill passes - A bill that would reduce pension benefits for future police officers and firefighters passed the Illinois House on Tuesday. "By the time all's said and done, no one's going to be real, real happy," said state Rep. Mike Bost, R-Murphysboro. Marion Mayor Bob Butler was one of those people. "The burden on municipalities, the way the legislation is set up now, is intolerable," Butler said. "Even with revisions, this is still going to be intolerable." The measure, designed to gradually begin reining in rising retiree costs for municipalities, was approved on a 95-18 vote. The push for changes to the retirement system for police and firefighters has been under way for several years. Mayors and other local officials want to reduce the benefits in order to cut the amount local taxpayers must contribute to finance the pensions. Officials representing police and fire unions want the new law to require cities to make adequate payments into the pension funds, which are financed by investment income and contributions from both cities and workers. The current legislation would: Boost the retirement age for police and firefighters from 50 to 55. Those who retire at age 50 would see a 30 percent reduction in their benefits. Make the maximum salary to calculate benefits $106,800. Pension benefits no longer would be calculated on the employee's final salary, but instead figured as an average of the final 8 years of service.
The pension calculations for a New Haven police officer are enough to make a city taxpayer weep. An extreme example is the pension for a retiring assistant chief, Stephanie Redding, 48. Redding, who is paid $100,350 annually, will retire with a pension of $117,750. The high payout is required by a labor contract with various devices that make it possible for officers to retire with annual pensions that may exceed their base pay. For most officers, base pay, overtime and extra duty income are all factored into pension calculations. An officer such as Redding, who does not receive overtime, instead qualifies for a pension based on the pay of the next highest ranking officer — in her case, the chief of police, who earns $150,000 a year. Her pension, if calculated on her actual base pay, would have been $82,000.
And the typical police officer retiring with the same experience trails narrowly at "only" $1.2 million.
So says Chicago's Civic Committee, which in an e-mail Friday morning released results of what it says is a study based on government records it recently obtained under a Freedom of Information Act request. According to the business group, the fact that sworn personnel can retire at age 50 with full benefits after just 20 years on the job gives them rights to pensions that far exceed what someone in the private sector would get after a similar period. Of the 67 firefighters who retired last year after at least 20 years working — holding ranks from commissioner to firefighter and paramedic — almost all will be entitled to a pension of at least $5,000 a month, the group said.
Retired cops will collect pensions while working new jobs for town - Four retired police officers will collect pensions while working in new jobs for their New Jersey town. The pension payments and salaries give the men an income of more than they earned while in uniform. Philip DiNicola is collecting a $128,000 pension after retiring as deputy police chief in Woodbridge Township. He'll also earn about $80,000 a year as the township's top court administrator. Retired Capt. Robert Hubner will earn $75,000 tracking scofflaws on top of his $105,000 pension. Detective Joseph Nisky will collect an $88,000 pension along with an $82,000 salary as recreation director. Sgt. Victor Pussilo will receive about $50,000 in the evidence bureau on top of a $69,000 pension.
Should criminal cops lose their pensions? - "Can't you find out if anyone is going to do something about this?" Here's an excerpt of the answer that will appear in tomorrow's Daily News: One after another, stories about bad cops have fallen around the city like dominoes lately, each one more disturbing than the next. There has, however, been one common thread: many of those who have been fired from the force or arrested have had no fear of losing their pension. Some of accused face charges that range from murder to rape to soliciting sex from a minor. As it stands now, the city code doesn't call for a city employee - be it a cop, firefighter or trash collector - to lose his pension, even if he's convicted of one of those crimes. Count City Councilman Frank Rizzo among those who are wondering if the code needs to be changed. "I just began discussing this my staff today," Rizzo said earlier today. "It's something that we're going to look into after the [city] budget is finished," he said. "We'll probably have to hold hearings." Rizzo said he was bothered by a recent spate of stories about cops who have retired from the force a day before they were arrested. Many have interpreted the sudden retirements as last ditch attempts on the cops' behalf at saving their pension benefits. Officer Anthony Floyd, a 14-year veteran, retired on Tuesday, and was charged the following day with assaulting and harrassing a woman he was dating. Another longtime cop, Tyrone Wiggins, retired a day before he was arrested on rape charges in November. "We can't have cops retiring one day, then getting arrested the next," Rizzo said. Even cops fired for gross misconduct are not blocked from receiving a pension. Also this week, Police Commissioner Charles H. Ramsey fired Sgt. Robert Ralston after the 21-year veteran admitted that he shot himself last month and created a phony story about being shot by a black man with corn rows.
The state funds that pay pension and health-care benefits to retired teachers, corrections officers and millions of other public workers faced a cumulative shortfall of at least $1.26 trillion at the end of fiscal 2009, according to a new report.
The study, to be released Tuesday by the Pew Center on the States, found that the pension and health-care funding gap increased by 26 percent over the previous year. Pew officials said the growing shortfall was driven by inadequate state contributions, an aging population and market losses that accompanied the recession.
Although investment markets have recovered substantially since the period covered by the report, its authors warn that states still face an increasing burden from retiree costs that are beginning to crowd out critical services.
“In many states, the bill for public-sector retirement benefits already threatens strained budgets and is competing for resources with other critical needs, including education, infrastructure and health care,” said Susan Urahn, managing director of the Pew Center on the States.
The report, which is based on state financial reports, found that states faced a $660 billion pension funding gap. Meanwhile, retiree health-care liabilities — which most states handle on a pay-as-you-go basis — totaled $604 billion, the report said.
Even as they face increasing liabilities, the report said, many states are not making pension contributions in amounts recommended by their actuaries as they juggle retiree and other costs against a backdrop of weak revenue.
In making its calculations, Pew used the states’ assumptions for what their pension funds would earn in annual investment returns, typically 8 percent — a figure that states have mostly met in recent decades but that some analysts think is now overly optimistic.
If states calculated their investment returns the same way that private firms are required to for their pensions, their obligations would balloon to $1.8 trillion, the report said. If states pegged their returns to 30-year Treasury bonds, an even more conservative standard, the liability would be $2.4 trillion.
Concern about underfunded pensions has prompted at least 29 states to either reduce pension promises to new employees or require workers to contribute more toward their retirement benefits, according to a separate report by Pew.
Three states — South Dakota, Minnesota and Colorado — have moved to reduce cost-of-living increases for current retirees, but those moves are facing court challenges.
The cost of pension plans and the benefits earned by the approximately 17 million state and local government workers have come under heightened scrutiny in recent years, as private-sector pensions grow increasingly rare and governors struggle to contain costs and, in many instances, reduce taxes.
Government employee union leaders, meanwhile, say the problems plaguing public pension plans are largely overstated.
“While individual investors are still struggling to grow their retirement portfolios to sufficient levels, pension funds have shown remarkable resilience,” said Gerald W. McEntee, president of the American Federation of State, County and Municipal Employees. “These funds are not only persevering but are well on their way to full recovery.”
McEntee added that retirees who were AFSCME members earn average pensions of approximately $19,000 per year, of which member contributions and investment returns cover 70 to 80 percent.
“They earn modest benefits after a career of service,” he said.
A 10,200-acre (4,100-hectare) desert site in Arizona sold for $32.5 million this week, five years after a group with investors including the California Public Employees’ Retirement System paid $400 million for the land.
Arcus Property Solutions LLC, a private-equity fund with about $100 million under management, paid cash for the property in Goodyear, about 60 miles (97 kilometers) southwest of Phoenix, said Kent Kleinman, a spokesman for the Gilbert, Arizona-based company. The site, now called Amaranth Land LLC, had been planned for a 42,000-home community by the Calpers- financed group when it was purchased in 2006.
The deal shows how property investors are taking advantage of a plunge in values after the real estate bubble burst in Arizona. A group of lenders, led by Goldman Sachs Group Inc. (GS), seized control of the Amaranth site in 2009 after the bust halted development, said Jeff Garrett, owner of Garrett Development Corp., the land’s manager after the foreclosure.
“Five, six years ago, people were spending $200 million or $300 million or $400 million,” Garrett said in a telephone interview. “This just sold for about eight cents on the dollar.”
The 2006 buyers were a joint venture of MW Housing Partners III LP, a real estate fund with money from Calpers and Weyerhaeuser Co. (WY); and Scottsdale, Arizona-based Montage Land LLC, according to Arizona Corporation Commission records. The deal was funded by a $250.1 million loan and $150 million in cash, according to Terry McDonnell, publisher of Business Real Estate Weekly of Arizona in Scottsdale.
Speculative Deals
“Of all the speculative deals I’ve seen here, this was right at the top,” McDonnell said in a telephone interview. “It’s hard for me to think of a more speculative deal of this magnitude in Maricopa County.”
Calpers, the nation’s largest pension fund, had investments valued at $209.7 million in MW Housing Partners III in the fiscal year ended June 30, 2007, according to its annual report. The next year, the investment had a negative market value of $102.9 million, the fund said. MW Housing wasn’t listed as a Calpers investment in fiscal 2010, its most recent report.
Calpers doesn’t discuss individual real estate deals, said Wayne Davis, a spokesman for the Sacramento-based pension fund, which had $234.5 billion of assets as of May 24. Bruce Amundson, a spokesman for Federal Way, Washington-based Weyerhaeuser, said MW Housing invested the $150 million cash in the Amaranth purchase.
Newhall Ranch
In October 2009, Calpers severed ties with Macfarlane Partners LP, the San Francisco investment firm led by Victor Macfarlane that managed MW Housing Partners. MW Housing also led Calpers’ $970 million investment in Newhall Ranch, a master- planned community north of Los Angeles that filed for bankruptcy in 2008, wiping out Calpers’ stake.
Garth Wieger, a founding partner at Montage, the managing partner of the development, said he couldn’t comment because of a confidentiality agreement. Michael Duvally, a spokesman for Goldman Sachs in New York, declined to comment.
The listing agent for the Arizona property was Nathan & Associates Inc. in Scottsdale. The land is now used for cattle grazing with future revenue possible from selling its water rights or letting Goodyear expand a nearby landfill, said Kleinman of Arcus Property.
“This won’t be developed in my lifetime,” Kleinman, who gave his age as “mid-50s,” said in a telephone interview. “Our plan is basically buy and hold and resell after the market appreciates.”
To contact the reporter on this story: John Gittelsohn in New York at johngitt@bloomberg.net.
To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net.
The city of Central Falls, Rhode Island says they are so broke they had to give their retirees a dreaded ultimatum — give up 50% of your pension or risk losing it all.
As the size of government across the nation continues to spiral out of control countries and states across the nation are finding it increasingly difficult to pay their builds Central Falls, Rhode Island has been forced into giving their retirees a dreaded ultimatum
According to a CNN report, Judge Robert Flanders who appointed by the state to work out a solution to keep the the city from going bankrupt said the choice is limited to the pensioners to either volunteer to a 50% pension cut or risk losing it all in bankruptcy court.
The ultimatum has been given as part of an overall restructuring plan for the city in which broad sweeping sacrifices and deep budget cuts are being made across the board in order to close the gap on the city’s $80 million dollar budget shortfall.
The Fox news video report attached on this page gives more details on the crisis in Flanders, Rhode Island.
The situation in Flanders may just be a prelude of things to come across the nation.
Just last week in a blaring sign of the times we saw the collapse of the San Francisco civil court system which was declared as essentially being out of business.
The Pentagon has just announced they are deploying 20,000 troops within the United States to handle civil unrest in the event of an economic collapse.
Many states and cities are on the verge of such a collapse and one will inevitably occur across the entire country if the nation is forced to default on its debt as Greece was just last week.
Adding to the fears of economic collapse is the reportedly stalled negotiations between politicians in Washington to hammer out a deal to prevent a default from happening by raising the U.S debt ceiling.
While a more reputable smaller credit rating agency, The Egan-Jones Agency, has already downgraded the United States credit rating on fears of a default unavoidable , the major agencies have so far neglected to do so instead choosing only to put the U.S. on a credit rating warning.
However, two of the major agencies Moody’s and S&P warned last week if the U.S doesn’t work out a deal to deal with the out of control debt by August second they will be forced to downgrade the United States credit rating. Many analysts warn such a move by the major agencies will trigger a chain reaction of events that will lead to a global financial meltdown.
MSNBC warned last week it may already be to late and we may be soon hearing stories similar to the Central Falls, Rhode Island story all over the United States.
The pentagon has announced plans to deploy a 20,000 strong internal troop force within the united states over the next two years civil unrest in the even of a catastrophic ...
The presiding judge of San Francisco’s court system announced Monday she is preparing to dismantle operations in the civil division of her court and she is warning the layoffs and closures will be drastic.
What is in store is plenty of pain. Pain for the public and pain for court workers, who face unprecedented layoffs. Courtrooms will be closed. Clerk’s offices will be shuttered. And the hallways will be quiet.
Presiding judge Katherine Feinstein broke the bad news that 25 of 63 courtrooms will close and 200 employees will be laid off.
“The civil division will essentially be out of business,” Feinstein said. “The cases will sit on shelves piled high and will not make it into a courtroom for close to five years. It will for all practical purposes dismantle our court. Paying a traffic ticket for a criminal fine at the Hall of Justice will take hours standing in line. There will be fewer clerks there to process your payment. Obtaining a copy of a criminal or civil court record will take months. Obtaining a divorce will take at least a year and a half.
Feinstein says this was the only option. San Francisco’s courts face a deficit of almost $14 million. In recent years, the court dipped into its reserves to prevent layoffs, but its reserves have dried up. Now, their budget will be cut by almost $5 million.
AP reports:
“The civil justice system in San Francisco is collapsing,” Feinstein said.
***
“The future is very, very bleak for our courts” ….
In a press release issued yesterday, the Court said:
“Equal access to justice is one of the fundamental underpinnings of our democracy,” Judge Feinstein said.
***
We will be a shell of what we once were.
***
The Court will close:
•12 Civil Trial Departments;
•Two Complex Litigation Departments;
•One Law & Motion/Discovery Department;
•One Case Management Department;
•One Juvenile Dependency Department; and
• One Juvenile Traffic Department;
Metropolitan News-Enterprise points out that other California courts are in the same boat:
Los Angeles Superior Court Presiding Judge Lee Edmon said yesterday such drastic measures are not being ruled out locally in the wake of larger-than-anticipated state budget cuts.
“All options are on the table at this point,” Edmon said, adding that the court leadership has not yet decided how to proceed.
***
Edmon acknowledged “trial courts have been cut to the bone” already, noting the superior court “laid off 500 people not too long ago”….
***
“This year is bad and next year is worse,” she said” ….
***
San Diego Superior Court Judge Daniel Goldstein … predicted “more staff is going to be laid off in more counties to come”….
On January 20 the progressive think tank Michigan Forward
and the Detroit
branch of the NAACP sent a joint letter to Michigan Governor Rick Snyder
expressing concern over Public Act 4, the Local Government and School District
Fiscal Accountability Act.
Signed into law in March 2011, it granted unprecedented new
powers to the state’s emergency managers (EMs),
including breaking union contracts, taking over pension systems, setting school
curriculums and even dissolving or disincorporating municipalities. Under PA 4,
EMs, who are appointed by the governor, can
“exercise any power or authority of any officer, employee, department, board,
commission or other similar entity of the local government whether elected or
appointed.”
What are the qualifications for such a powerful office and
the six-figure salary that accompanies it? Not much: PA 4 requires “a minimum
of 5 years’ experience and demonstrable expertise in business, financial, or
local or state budgetary matters.” Last year the state held a pair of two-day
training sessions for EMs, both run primarily
by companies that provide outsourcing services to municipalities and school districts.
Yet PA 4 made the emergency manager the single most powerful person in the
city.
Results were swift. In April the Benton Harbor EM, Joe
Harris, decreed: “Absent prior express written authorization and approval by
the Emergency Manager”—himself—“no City Board, Commission or Authority shall
take any action for or on behalf of the City whatsoever other than: i) Call a
meeting to order, ii) Approve of meeting minutes, iii) Adjourn a meeting.” The
move in effect abolished BentonHarbor’s elected City Commission and replaced it with
an unelected bureaucrat, perhaps the first time this has happened in US
history.
The implications went beyond BentonHarbor.
“Since the beginning of your administration, communities facing or under
emergency management have doubled,” Michigan Forward and the NAACP wrote to the
governor, citing a “failure of transparency and accountability” in the process
of determining which jurisdictions need an emergency manager. The financial
review team assigned to Detroit, for instance,
had recently met in Lansing,
nearly 100 miles away—“a clear example of exclusion and voter
disenfranchisement,” according to the authors. On February 6 an InghamCounty
circuit judge ruled that the Detroit
team’s meetings must be held in public.
Of Detroit’s
713,777 residents, 89 percent are African-American. The city of Inkster (population
25,369), which recently got an EM, has a black population of 73 percent. Having
EMs in both cities would mean that more than
half the state’s black population would fall into the hands of unelected
officials.
Everyone agrees that something must be done to “fix” Michigan’s struggling
urban centers and school districts, although news of a $457 million surplus in
early February prompted the state budget director to declare, “Things have
turned.” But at what cost? In 2011 Governor Snyder stripped roughly $1 billion
from statewide K-12 school funding and drastically reduced revenue sharing to
municipalities. Combined with poor and sometimes corrupt leadership and
frequently dysfunctional governments, these elements have brought Michigan cities to the
brink of bankruptcy. Residents of the hardest-hit places have fled if they are
able.
The state’s first emergency managers—previously known as
emergency financial managers—were appointed between 2000 and 2002 by Republican
Governor John Engler in the cities of Hamtramck,
Flint and Highland
Park to prevent them from declaring bankruptcy.
Although all eventually left when their job was done—the last in 2009—all three
cities are back in the red. In January the Highland ParkSchool
District was assigned an EM. (That
city—population 11,776—is 93.5 percent African-American.) Others followed, in
Ecorse, BentonHarbor
and Pontiac, as well as Detroit public schools.
Under PA 4, EMs have proven
to be a divisive solution.
Outsourcing services to private companies and abolishing
collective bargaining takes a page right out of the right-wing playbook: a 2011
report titled “101 Recommendations to Revitalize Michigan,” published by the
conservative MackinacCenter for Public Policy,
calls for ending “mandatory collective bargaining for government employees who
already enjoy civil service protections.” Many are worried that EMs will hasten
the gentrification of places like BentonHarbor, pushing out poor residents
to make way for developers. In one of his first acts under PA 4, Joe Harris
replaced nine people on the Brownfield Redevelopment Authority and all nine
members of the planning commission.
Despite their relatively short history, EMs
have a record of abusing their powers. This past summer Arthur Blackwell II, Highland Park’s former
emergency financial manager, was ordered to repay more than $250,000 he paid
himself. In Pontiac EFM Michael Stampfler outsourced the city’s wastewater
treatment to United Water just months after the Justice Department announced a
twenty-six-count indictment against the company for violating the Clean Water
Act.
Multiple efforts are under way to rid Michigan of PA 4. The
first is a lawsuit brought in June 2011 by the SugarLawCenter for Economic and Social Justice
and the Center for Constitutional Rights challenging the law under the state
Constitution. Despite efforts by the Snyder administration to bypass the legal
process and force the Republican-controlled state supreme court to hear the
case immediately, the lawsuit is pending. Representative John Conyers is
pursuing the issue through the Justice Department, arguing that the law’s
impact on minority populations may violate the Voting Rights Act.
But Michigan Republicans seem to be most concerned about a
petition drive, organized by Michigan Forward, seeking a citizen referendum to
overturn the law. As of mid-February the petition had more than 200,000
signatures, well over the number necessary to put the law on hold. The group
plans to turn in the petitions on February 29. Since PA 4 replaced the law that
created emergency financial managers, this could eliminate the positions in Michigan until the
referendum is voted on in November.
GOP lawmakers are discussing replacement legislation, with
Michigan House Speaker Jase Bolger warning about “the chaos that could ensue if
the emergency manager law is suspended.” Since Michigan law prevents referendums on
appropriations bills, PA 4 opponents fear that any such law will contain an
appropriation to make it “referendum proof,” a tactic already used by the state
GOP this year.
The outcome of the citizen referendum and the constitutional
challenges may well determine if laws like PA 4 remain unique to Michigan or become the
national standard for dealing with impoverished urban areas. With the Indiana
Senate having just passed an emergency manager bill of its own, we may be
heading down that path.
The poll, conducted for the Detroit Free Press and WXYZ,
asked 600 likely voters how they plan to respond to Tuesday's referendum.
Only 35 percent of those polled said they would vote
"yes" to keep the emergency manager law in place, while 43 percent of
respondents said they would vote "no" on Proposal 1.
Those results conflicted with a
separate Glengariff Group poll of 600 likely voters released this week by
The Detroit News and WDIV showing that 45 percent of voters want to keep the
law, while only 39.5 percent favored repeal.
Both polls indicated that a large number of undecided voters
-- 18 percent and 15 percent, respectively -- have not yet not made up their
mind on Proposal 1.
And it's those undecided voters who may decide the fate of
the emergency manager law.
Polling experts say "no"
votes typically go up closer toward an election as unsure or uninformed
voters tend to reject that which they do not know. But Gov. Rick Snyder is
aggressively wooing voters this week as he crisscrosses Michigan, asking residents to "vote yes
on 1, no on the rest" of the state's six ballot proposals.
Public Act 4 of 2011, an updated and emboldened version of a
previous emergency manager law, gives a state appointee broad
powers to resolve fiscal crises in struggling municipalities and school
districts.
Individuals appointed by the state currently oversee the
cities of Allen Park, BentonHarbor, Ecorse, Flint
and Pontiac, along with public school districts
in Detroit, MuskegonHeights and Highland Park. Three cities -- Detroit, Inkster
and River Rouge -- are operating under consent agreements that extend some
emergency powers to local officials.
Snyder, in
a recent MLive op-ed, wrote that the law was updated to "to provide
additional early warning indicators to help communities and schools avoid a
financial emergency in the first place. And, if they are in an emergency,
appoint an emergency manager with more tools and ability to get the job done faster,
returning a stronger, fiscally sound community or school back to local
officials."
If Public Act 4 is repealed, Michigan Attorney General Bill
Schuette has opined that Public Act 72 of 1990 will be permanently reinstated,
but a pending
lawsuit filed on behalf of several municipal leaders challenges that
assumption.
The law was temporarily suspended in August after the state
election officials certified more than 200,000 signatures collected by an
opposition group seeking to place the referendum on the November 6 ballot.
The Stand Up For Democracy coalition argues the law does not
address the underlying issues causing financial stress in local governments and
say the law goes too far by allowing the state appointee to usurp local control
and terminate or modify union contracts.
The union-backed group is educating voters through a
statewide network it set up during signature collection and is tapping its $1.4
million cash reserve to begin airing radio and television commercials.
Spokesman Greg Bowens, citing internal polling, said last
week that the group is confident voters will reject the emergency manager law.
"We've defied predictions every step of the way by working together with
people around the state," he said, "and we think we're going to do it
again."
Jonathan Oosting is a reporter for MLive Media Group's
statewide news team. Contact him by email at joosting@mlive.com.
LANSING --
City Council members from Pontiac, Flint and BentonHarbor are suing the
state to remove their emergency financial managers.
The suit, filed in
Ingham County Circuit Court late Wednesday, alleges there is no emergency
manager law in Michigan
as a result of the suspension of Public Act 4 of 2011.
Attorney General
Bill Schuette and Gov. Rick Snyder have said the state's old emergency
financial manager law, Public Act 72 of 1990, has been in effect since August.
That's when PA 4 was suspended as a result of the Board of State Canvassers
certifying the proposed repeal of the 2011 law for the Nov. 6 ballot.
But a lawsuit
filed late Wednesday by the SugarLawCenter
and the Center for Constitutional Rights argues otherwise.
John Philo, legal
director of the SugarLawCenter,
said "there is no law authorizing the use of emergency managers in the
state of Michigan."
PA 4 repealed PA
72 and the suspension of PA 4 doesn't invalidate anything that happened while
the law was in effect, Philo said Thursday.
"The suit we
filed is based on the obvious fact that there cannot be emergency managers
without the legal framework to support them," he said. "The new law
has been suspended and the old law is dead."
Schuette's office
issued a news release saying he stands by his earlier opinion that PA 72 -- a
weaker emergency manager law -- is in force until the issue is decided Nov. 6.
Schuette
spokeswoman Joy Yearout noted that there already is an opinion issued in August
by Wayne County Circuit Judge John Murphy saying PA 72 is in effect.
Emergency managers
are operating in BentonHarbor, Flint, Pontiac and Ecorse, as well as in school districts in Detroit, Highland Park and MuskegonHeights. Appointment of an emergency
financial manager is pending in Allen
Park. Detroit
entered into a consent agreement with the state under PA 4.
The case is
assigned to Ingham County Circuit Judge Joyce Draganchuk.
