Nevada County Grand Jury • 2018-2019

Will the Public Suffer Because of Unfunded Pension Liabilities issued by the 2017-2018

Published: May 09, 2019 84 pages Consolidated Report

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Findings 10 findings

F1 Page 3

Nearly every Nevada County agency has a Net Pension Liability.

F2 Page 3

Many Nevada County agencies, especially schools, lack a sufficient Net Position to successfully comply with the requirement to reduce their Net Pension Liability.

F3 Page 3

Some Nevada County agencies, especially schools, have a negative Net Position.

F4 Page 3

Transparency demands that financial statements provided by the office of the Superintendent of Schools identify each charter school’s Net Pension Liability.

F5 Page 3

The strain on Nevada County agency budgets is likely to require cutbacks in services to balance the pension contribution increases.

F6 Page 3

Many agencies may spend down their reserves to avoid cutbacks in services.

F7 Page 3

New sources of revenue may be requested by many agencies to avoid cutbacks in services or reduction of reserves.

F8 Page 3

The public bears most of the risk if CalPERS and CalSTRS investments continue to underperform.

F9 Page 3

Higgins Fire Protection District is out of compliance with Government Code 26909 by not filing an audited financial statement for 2015-2016.

F10 Page 3

Nevada City School of the Arts’ financial statements should reflect their Net Pension Liability.

Recommendations 7

R1
Page 3

The Nevada County Chief Executive Officer should provide a separate presentation to the Board of Supervisors describing the County’s current Net Pension Liability and providing a plan for addressing the problem. The presentation should not be hidden in the annual budget report presentation.
R2
Page 3

Public agencies and public employee unions should explore how increasing employee pension contributions can reduce non-funded pension liabilities. Report on Responses to 2017-2018 Report: Will the Public Suffer Because of Unfunded Pension Liabilities 2
R3
Page 4

For the purposes of transparency and easy access, each agency should provide links to three years of audited financial statements and summary pension data for the same period on the financial page of its public website.
R4
Page 4

Public agencies should consider implementing the suggestions from the League of California Cities.
R5
Page 4

Higgins Fire Protection District should comply with Government Code 26909 and file an audited financial statement for 2015-2016.
R6
Page 4

Nevada County Superintendent of Schools should report the Net Pension Liability for charter schools that are part of its agency’s audit.
R7
Page 4

Nevada City School of the Arts should report its Net Pension Liability in its financial statements. Respondents to the Original Report  Nevada County Board of Supervisors for Recommendations R1, R2, and R4 by 10 August 2018.  City of Grass Valley for Recommendations R2 and R4 by 10 August 2018.  City of Nevada City for Recommendations R2, R3, and R4 by 10 August 2018.  Town of Truckee for Recommendations R2 and R4 by 10 August 2018.  Nevada Irrigation District for Recommendations R2, R3, and R4 by 9 September 2018.  Nevada County Consolidated Fire District for Recommendations R2, R3, and R4 by 9 September 2018.  Nevada Cemetery District for Recommendations R2, R3, and R4 by 9 September 2018.  Ophir Hill Fire Protection District for Recommendations R2, R3, and R4 by 9 September 2018.  Peardale Chicago Park Fire Protection District for Recommendations R2, R3, and R4 by 9 September 2018.  Penn Valley Fire Protection District for Recommendations R2, R3, and R4 by 9 September 2018. Report on Responses to 2017-2018 Report: Will the Public Suffer Because of Unfunded Pension Liabilities 3 2018-2019 Nevada County Grand Jury  Nevada County Resource Conservation District for Recommendations R2, R3, and R4 by 9 September 2018.  Higgins Fire Protection District for Recommendations R2, R3, R4, and R5 by 9 September 2018.  Truckee Cemetery District for Recommendation R3 by 9 September 2018.  Truckee Donner Public Utilities District for Recommendations R2, R3, and R4 by 9 September 2018.  Truckee Fire Protection District for Recommendations R2, R3, and R4 by 9 September 2018.  Tahoe-Truckee Sanitation District for Recommendations R2 and R4 by 9 September 2018.  Truckee Tahoe Airport District for Recommendations R2 and R4 by 9 September 2018.  Nevada County Superintendent of Schools for Recommendations R2, R3, R4, and R6 by 10 August 2018.  Grass Valley School District for Recommendations R2, R3, and R4 by 9 September 2018.  Chicago Park School District for Recommendations R2, R3, and R4 by 9 September 2018.  Clear Creek School District for Recommendations R2, R3, and R4 by 9 September 2018.  John Muir Charter School for Recommendations R2, R3, and R4 by 9 September 2018.  Nevada City School District for Recommendations R2, R3, and R4 by 9 September 2018.  Nevada County School of the Arts for Recommendations R2, R3, R4, and R7 by 9 September 2018.  Nevada Joint Union High School District for Recommendations R2, R3, and R4 by 9 September 2018. Report on Responses to 2017-2018 Report: Will the Public Suffer Because of Unfunded Pension Liabilities 4 2018-2019 Nevada County Grand Jury  Penn Valley Union Elementary School District for Recommendations R2, R3, and R4 by 9 September 2018.  Pleasant Ridge Union School District for Recommendations R2, R3, and R4 by 9 September 2018.  Twin Ridges Elementary School District for Recommendations R2, R3, and R4 by 9 September 2018.  Union Hill Elementary School District for Recommendations R2, R3, and R4 by 9 September 2018.  Bitney College Prep High School for Recommendations R3, R4, and R6 by 9 September 2018.  Forest Charter School for Recommendations R3, R4, and R6 by 9 September 2018.  Sierra Montessori Academy for Recommendations R3, R4, and R6 by 9 September 2018.  Twin Ridges Home Study Charter School for Recommendations R3, R4, and R6 by 9 September 2018.  Yuba River Charter School for Recommendations R3, R4, and R6 by 9 September 2018. Responses to the Original Report Begin on the next page. Report on Responses to 2017-2018 Report: Will the Public Suffer Because of Unfunded Pension Liabilities 5 2018-2019 Nevada County Grand Jury Heidi Hall, I't District CouxrYop NpvADA Chair Edward C. Scofield, 2nd District Dan Miller, 3'd District t'Hank" Srare op CalrponNra Wm. Weston, 4th District Vice-Chair Richard Anderson, 5th District Boano or SupERVrsoRS Julie Patterson Hunter, Clerk of the Board July 10, 2018 ,.-") '(i (*(t,')* ' * tl The Honorable Thomas Anderson ltltY, Presiding Judge of the Nevada County Grand Jury ? 201 Church Street ,1nl I Nevada County, CA95959 /!;/ot ( il RE: Response to Grand Jury Report entitled "Will the Public Suffer Becouse Of Unfun de d Liab il itie s ?" Dear Honorable Judge Anderson: As required by California Penal Code Section 933, the Board of Supervisors hereby submits its responses to the FY 2017l18 Nevada County Civil Grand Jury Report; dated June 6, 2018 entitled "Will the Public Suffer Because of Unfunded Pension Liabilities? " These responses to the Grand Jury's Findings and Recommendations were approved by the Board of Supervisors at their regular meeting on July 10,2018. The Responses are based on either personal knowledge, examination of official County records, or information received from the Board of Supervisors and County staff members. The Board of Supervisors would like to thank the members of the FY 2017118 Grand Jury for their participation and effort in preparing their Repofts, and their participation in the Grand Jury process. Sin4cerely,-.rtW Edward C. Scofield, Chairman Nevada County Board of Supervisors cc: Thomas Achter, Foreman, Grand Jury Richard Haffey, County Executive Officer Martin Polt, County Deputy Officer Alison Barrett-Green, County Counsel 950 Maidu Avenue, Suite 200, Nevada City CA 95959-8617 phone:530.265.1480lfax:530.265.9836 itoll free:888.785.1480lemail: [email protected] website : http ://www.mynevadacountlr.com/nclbos PRINTED ON RECYLED PAPER NEVADA COUNTY BOARD OF SUPERVISORS RESPONSES TO 2018 Nevada County Civil Grand Jury Report Will the Public Suffer Because of Unfunded Pension Liabilities? DATED June 10, 2018 Responses to findings and Lecomrnendations are based on either personal knowledge, exarnination ofofficial county records, review of the responses by the County Executive Officer, Chief Fiscal Officer or testimony from the Board of Supervisors and county staff rnembers. A. RESPONSES TO FINDINGS F 1. Nearly every Nevada County agency has a Net Pension Liability. Agree Responding only for the County of Nevada agencies.