Mayor Michael Cacciotti Delivers State of the City at WISPPA

Mayor Michael Cacciotti updated members of Women in South Pasadena Political Action (WISPPA) Saturday morning on the state of the city. The meeting was held in the basement of Calvary Presbyterian Church on Fremont Avenue.

Cacciotti began by noting that when he joined the City Council in 2001, the General Fund Budget was between $13 and $14 million. It has almost doubled in the last 16 years, with the 2017-18 budget projected to be around $26.7 million. The projected net income may fluctuate, but was approved at $649,335.

The Police and Fire Department receive the highest percentages of the General Fund budget, $13.3 million, or 48%, but Cacciotti noted that that is one of the lowest percentage-wise in the San Gabriel Valley. The next largest recipients of the budget are City Council/management services ($2.7 million), public works ($2.1 million), and the public library ($1.7 million).

Total expenses are projected to dip in 2018-19, but begin to rise after that, as the CalPERS (California Public Employees’ Retirement System) employer’s cost rises by 18.5% from ’18-19 to ’19-20 and 32.4% from ’19-20 to ’20-21.

State employees are promised compensation and benefits according to a formula. It is thus the responsibility of the city and the state to make sure the fund is adequate.

City Treasurer Gary Pia explained that the errors made by CalPERS (California Public Employees’ Retirement System) that have caused South Pasadena to dramatically increase its contributions to the state employee retirement fund resulted from grossly overestimating earnings.

“One of the critical assumptions that is made,” said Pia, “is how much, what rate of return, what interest rate, will the plan be able to generate and earn in order to fund the benefit, and based on that assumption, how much does the city have to contribute so that the fund has enough with that interest rate to fund the benefit.

“And now [CalPERS is] saying, ‘We can’t make that happen on these estimates,’ and so they are asking for more money from the cities,” he continued. “We’re responsible for bridging that gap, and every city in the state is facing this situation.”

Cacciotti assured WISPPA that South Pasadena has kept strong emergency reserves. “When I got on the City Council, the reserves were about $3 million, now [the fund has] jumped a lot,” he said. These are undesignated reserves, money set aside for unforeseen emergencies. “If insurance rates double in the next few years or a reservoir collapses and we can’t get a loan, we can use [those monies],” said the mayor.

In addition, the city has a designated reserve. “Over the years we’ve established 13 separate funds that we’ve put about $6.75 million in, things like library expansion and the community center, ” continued Cacciotti.

Cacciotti also discussed upcoming street improvement projects, reminding his audience that the budget for fixing roads —now $1.3 million— was zero for several years about a decade ago. Road resurfacing, sidewalk improvements and fixes to gutters will soon be underway on Monterey Road from Via del Rey to Pasadena Ave. On Bushnell, between Oak and Huntington Dr., water runoff has caused pooling bringing live mosquito larvae to the area. Other streets that will receive improvements are Diamond Ave. from Monterey Rd. to Lyndon St.; Camino Del Sol, from Saint Albans Ave. to Santa Teresa, and Alpha Avenue, from La Fremontia to Valley View Rd.

In the course of his address, Cacciotti also informed WISPPA that the Eddy Park House will undergo interior remodeling and lead and asbestos abatement, as well as that the city is pushing to require all leaf blowers to be green, and that two properties–one at 1107 Grevalia St. and the other at 2006 Berkshire Ave.–have been purchased by the city for park projects.

“I want to thank councilmember [City Councilwoman Marina] Khubesrian, who pushes one of our designated reserve funds and set aside money to purchase these vacant properties for our residents, because some of areas are very park poor, especially that Berkshire area,” said Cacciotti.

The city is also working to recruit a new city manager, as well as to update its General Plan.

Cacciotti was introduced by WISPPA president Bianca Richards, who began the meeting by reminding members of the organization: “We pride ourselves on wanting to know the facts, know the information, so that when we overhear something we can clear it up.”