Orange County Grand Jury • 2011-2012

Compensation Cost Transparency Transparency Breaking Up Compensation Fog - but Why Hide Pension Costs?

Published: March 21, 2012 43 pages
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Findings and Recommendations 5 findings

F1
F2 F3 F4 F5 R1 R2 R3 R4 R5 County County of Orange X X X X X X Cities Aliso Viejo X X X X X X X X Anaheim X X X X X X X X Brea X X X X X X X X Buena Park X X X X Costa Mesa X X X X Cypress X X X X X X X X X X Dana Point X X X X X X Fountain Valley X X X X X X X X X X Fullerton X X X X X X X X Garden Grove X X X X X X X X Huntington Beach X X X X X X X X X X Irvine X X X X X X La Habra X X X X X X La Palma X X X X X X X X Laguna Beach X X X X X X X X Laguna Hills X X X X X X X X Laguna Niguel X X X X X X X X X X Laguna Woods X X X X Lake Forest X X X X X X X X Los Alamitos X X X X X X X X X X Mission Viejo X X X X X X X X Newport Beach X X X X X X X X Orange X X X X X X X X Placentia X X X X Rancho Santa Margarita X X X X X X San Clemente X X X X X X San Juan Capistrano X X X X X X Santa Ana X X X X X X X X X X Seal Beach X X X X X X X X Stanton X X X X X X Tustin X X X X X X X X Villa Park X X X X X X X X Westminster X X X X X X X X X X Yorba Linda X X X X TABLE 3 – Special Districts/JPAs/OCERS Responses Required for Findings (F) & Recommendations (R)
Related Recommendations (1)
R1
(R1) - Access for Compensation Costs Transparency - The Grand Jury recommends that each of the sixteen Orange County cities, districts and joint power authority that were rated less than excellent for Accessibility upgrade their access to compensation costs. The access should be intuitive, readily identifiable on the web site home page and provide easy navigation within one or very few “clicks.”
F2
(F2) – Content & Clarity Ratings for EXECUTIVE Compensation Cost Content and Clarity for the OC cities elected officials and executives over $100,000 in base salary is improving in this 2nd year of ratings. On the other hand, there is understandably even more potential improvement possible for the Special Districts and joint power authority, which are in their 1st year of ratings. o County: The County of Orange went from a nonexistent Executive Compensation Page in 2011 to one rated excellent in 2012 for Content and Clarity. o Cities: This year in 2012, fourteen of thirty-four cities (41%) were rated excellent for Executive CCT Content and Clarity, while none were rated excellent in 2011.  However, twenty of the thirty-four cities were rated good, average, poor and nonexistent for Executive Compensation Cost Content and Clarity, all of whom could improve to excellent. o Special Districts and Joint Power Authority (JPA): Only three of twenty-three special districts/JPA (13%) were rated excellent for Executive Compensation Cost Content and Clarity.  Nineteen of twenty-three special districts/JPA who received ratings of good, average, poor and nonexistent for Executive Compensation Cost can improve to achieve an excellent rating.26
Related Recommendations (1)
R2
(R2) - Content & Clarity of EXECUTIVE Compensation Costs - The Grand Jury recommends that each of the forty-one of the fifty-seven Orange County cities, districts and joint power authority that were rated less than excellent for their Content and Clarity for their Executive and Elected Officials compensation costs page upgrade their Executive Compensation page. See
F3
(F3) - Content & Clarity for EMPLOYEE Compensation Cost Ratings There is the most opportunity for more transparent reporting in the Content and Clarity of Employee Compensation Cost reporting on local government websites. o County: The County of Orange was rated excellent above for their Executive Compensation Page Content and Clarity.  However, the County of Orange was only rated average for Employee Compensation Cost Content and Clarity and could improve to achieve an excellent rating. o Cities: Only five of thirty-four cities (15%) were rated excellent for Employee Compensation Cost Content and Clarity.  Twenty-nine of the thirty-four cities were rated good, average, poor and nonexistent for Employee Compensation Cost Content and Clarity, all of whom could improve to excellent. o Special Districts and Joint Power Authority (JPA) Only four of twenty-three special districts and joint power authority (17%) were rated excellent for Employee Compensation Cost Content and Clarity.  Nineteen of the twenty-three special districts/JPA were rated good, average, poor and nonexistent for Employee Compensation Cost Content and Clarity, all of whom could improve to excellent. One of the 23 special districts/JPAs was rated “Not Applicable” due to their volunteer executive board and no paid executives. (3+19+1=23).
Related Recommendations (1)
R3
(R3) - Content & Clarity of EMPLOYEE Compensation Costs - The Grand Jury recommends that the County of Orange and all Orange County cities, districts and joint power authority that were rated less than Excellent for Content and Clarity for their Employee compensation costs pages upgrade their Employee pages. See
F4
(F4) – Transparency of Employer Pension Contribution Rates Many Orange County local government web sites do not generally post their employer pension annual contribution rates prominently to their web sites as part of their compensation cost disclosure for public disclosure. Specifically, these employer contribution percentages refer to the annual percentages of employee salary that CalPERS (California Public Employees Retirement System) or OCERS (Orange County Employee Retirement System) requires of Orange County local governments to fund their employee guaranteed pension plans. OCERS has the employer pension contribution rates buried in detailed actuarial reports and presentations on the OCERS website or requires member passwords to access these annual governmental funding rates. Thus, there is limited transparency for the public of these governmental pension contribution rates.
Related Recommendations (1)
R4
(R4) - Transparency of Employer Pension Contribution Rates - The Grand Jury recommends that all Orange County cities, districts and joint power authority, as well as the County of Orange, post their employer pension annual contribution rates prominently and transparently on their web sites. Current and recent rates would be instructive and informative. It is recognized that some already do. The Grand Jury recommends that OCERS display their member organizations annual contribution rates in a transparent way to the general public without password access on their web site. For a suggested model, see http://calpers.ca.gov and enter “public agency employer contribution search.”
F5
(F5) –Inclusion of Overtime and On-Call Pay in Employee Compensation Costs The Orange County “de facto” standard for CCT in the county, cities, districts and JPA now contains all employees, including a page for executives and all elected officials. Two key categories are missing from compensation cost reporting. They are overtime pay and on- call pay. They have become important as the new “de facto” compensation cost reporting standard which now includes all employees. These two cost categories can be significant for public safety employees. However, it is recognized that these cost categories generally do not apply to elected officials. On the other hand, if overtime does not occur for various employee positions, it is important for citizens to be aware of the aware of that in the annual reporting.
Related Recommendations (1)
R5
(R5) - Transparency of Overtime Pay and On-Call Pay in Employee Compensation Cost Reporting – The Grand Jury recommends that all Orange County cities, districts and joint power authority, as well as the County of Orange, include overtime pay and on-call pay in compensation cost reporting on their employees’ compensation pages. See

Agency Responses 27

Government agencies' official responses to this report's findings and recommendations. Click on a response to see the structured breakdown.