MOORLACH UPDATE — Seeking Independence — July 3, 2015

Allow me to wish you a Happy Independence Day! I hope your 4th of July weekend is a relaxing one and that you have time to reflect on our nation’s 239th birthday and the supposed freedoms that we enjoy.

Freedom is a very precious asset to acquire and hold on to. Being subject to a king or ruling force is not a pleasant thought. Unfortunately, when I became an elected official, it did not take very long to realize that we are not entirely free. In a democracy, we are subject to those who are in the majority. I have found, as a general rule, that local and state governing agencies are run by public employee unions through the candidates they have backed. Public employee unions are the ATM machine for Democrat candidates in California (see MOORLACH UPDATE — SB 128 — June 4, 2015 June 4, 2015 John Moorlach; MOORLACH UPDATE — Senator Steve Glazer — May 29, 2015 May 29, 2015May 29, 2015 John Moorlach; and MOORLACH UPDATE — New Political Split — April 24, 2015 April 24, 2015 John Moorlach).

On my first day as a County Supervisor, I insisted on having the ability for the County to read and review the annual audited financial statements for the Association of Orange County Deputy Sheriffs’ Insurance Trust. This simple request, and one requiring changes to their retiree medical plan, started our tense relationship. AOCDS did not want me to become a County Supervisor and spent plenty for my opponent in the 2006 campaign with their independent expenditures. AOCDS and the other county bargaining units want control, have garnered it through the electoral process, thus insuring that Orange County residents are not truly free.

So, today’s headlines should not be a shock. The Voice of OC and the OC Register (which may print tomorrow or Sunday), respectively, provide the news that the Public Employment Relations Board (PERB) Chief Administrative Law Judge ruled against Civic Openness in Negotiations (COIN). As the old line from the movie "Casablanca" goes, "I’m shocked." A union judge is opposed. Really? Especially with his history of trying to obstruct other similar reforms around the state?

I believe the Administrative Judge is wrong. The next story will be whether the new Board of Supervisors will appeal. I have my doubts. Two of the new members were the beneficiaries of $150,000 each in AOCDS independent expenditures. The current Chair bends over backwards to assist AOCDS. So much so, that a recent Orange County Grand Jury report addresses the blatant nonsense of kowtowing to AOCDS.

This Grand Jury report, titled"ORANGE COUNTY SHERIFF MEDICAL INSURANCE: COUNTY FAILURES IN NEGOTIATION, DOCUMENTATION, OVERSIGHT, AND TRANSPARENCY," does a scholarly job of addressing the joys of negotiating in closed session and the virtues of COIN (also see MOORLACH UPDATE — Butt Out — June 13, 2015 June 13, 2015June 13, 2015 John Moorlach; MOORLACH UPDATE — COIN Modifications — July 18, 2014 July 18, 2014July 18, 2014 John Moorlach; MOORLACH UPDATE — Minting New COIN — June 25, 2014 June 25, 2014June 25, 2014 John Moorlach; MOORLACH UPDATE — COIN and VBM — June 23, 2014 June 23, 2014June 23, 2014 John Moorlach; and MOORLACH UPDATE — Maximus COIN — June 17, 2014
June 17, 2014June 17, 2014 John Moorlach).

I voted against the AOCDS MOU last year for the reasons cited in the report (see MOORLACH UPDATE — Pythons’ Tightening Grips — July 15, 2014 July 15, 2014July 15, 2014 John Moorlach and MOORLACH UPDATE — Homeless Shelter, et al — July 16, 2014 July 16, 2014July 16, 2014 John Moorlach). And I proposed COIN as a necessary method of stopping the nonsense that occurs behind closed doors.

The Grand Jury report can be read at:

Allow me to provide you with a few selected portions of the report, which concludes with recommendations that are in COIN. You’ve got to love the ironies.

Executive Summary:

". . . a lack of transparency that sometimes serves to undermine the collective bargaining process."

Page 19

The 2012-2016 MOU adopted by the Board of Supervisors (at Section 8.E), potentially exempts some of those County employees included in the "55 safety formula" (e.g., Sheriff employees) from having to pay any ARC contribution as of July 1, 2015. Their ARC would, over time, be reduced from 3.6% of their base salary to as low as zero.

As of July 1, 2015, County employees who are not "55 safety formula" employees will essentially be paying the entire cost of the monthly County retiree contributions paid to the AOCDS Trust for Sheriff employee medical coverage. This change clearly results in a significant difference between what is required of Sheriff employees and those who are not Sheriff employees.

The Grand Jury was informed that the MOU provisions leading to the elimination of the ARC for Sheriff employees was added to the MOU in a closed session of the Board of Supervisors. This session was held after the formal negotiations had been concluded by the negotiating teams representing the County and AOCDS, and effectively prevented review and comment by either of the negotiating teams before it was ultimately adopted by the Board of Supervisors.

Page 22

One observer of this closed session indicated that as soon as the proposal was made, two other Board members almost immediately concurred with the proposal that would place on the County significant additional long-term financial responsibilities for retired health care coverage for Sheriff employees. It was further reported to the Grand Jury that the ensuing discussion of the matter was "brief" and no further study of the potential implications of the new proposal was considered by the Board before a vote was held on an MOU containing the new proposal. Had the County just decided to negotiate against itself? After all, had not all five Supervisors agreed in April to go to mediation to avoid this exact outcome? What had happened in the intervening two months?

It was reported to the Grand Jury, based on the dialogue observed between the five Supervisors, that the manner in which the new provisions were proposed resulted in two Supervisors opposing final approval of the MOU. The MOU, containing these terms, was ultimately approved by a 3-2 vote of the Supervisors at the regularly scheduled Board of Supervisors meeting on July 15, 2014. Therefore, based on the information provided to the Grand Jury, the Grand Jury has concluded that greater transparency is called for in the MOU negotiation process.

Page 22

Something positive may actually have come as a result of all of this. Following Costa Mesa’s lead, one of the two Supervisors who had opposed the new AOCDS MOU proposed adoption of a County ordinance that would require transparency for employee contract negotiations. The ordinance (Sec. 1-3-12.), titled "Civic Openness in Negotiations" (COIN), was adopted by a 5-0 vote in August 2014.

Page 23

Adoption of the COIN ordinance appears to be a very positive development. However, COIN is only an ordinance, which is always subject to repeal or sunsetting by a majority of the Supervisors. As a matter of fact, during the debate on whether to first adopt the COIN ordinance, one of the Supervisors proposed that the ordinance sunset in 2016, the year the current AOCDS MOU will expire. The proposed sunsetting provision was rejected.

If COIN remains intact, the Supervisors and the public will certainly have an opportunity, in the next year, to assess whether the ordinance is having its intended effect, as the current County-AOCDS MOU expires on June 30, 2016.

Page 24

R.1. The County should retain a qualified, experienced, and independent negotiator to assist in the next negotiations between Orange County and the Association of Orange County Deputy Sheriffs and require that entity to prepare an internally consistent Memorandum of Understanding that, for example, makes it clear whether the Orange County contributions are to be used only for active employees. (F.1.)

R.2. The County should retain a qualified, experienced, and independent negotiator to incorporate clear terms in the Memorandum Of Understanding that define limitations on the use of Orange County contributions that become reserve funds, specify how to deal with over-funding, and resolve what is to become of the funds in the Premium Stabilization Fund if the Trust’s agreement with Blue Cross is terminated. (F.2.)

Page 25

R.9. The County should support and take full advantage of Orange County’s Civic Openness in Negotiations – "COIN" ordinance in future Orange County and Association of Orange County Deputy Sheriff’s Memorandum of Understanding negotiations and approval processes. (F.9.)

I am not deterred and will continue to fight for the taxpayers of Orange County and the state of California. We must be diligent in obtaining true freedom and not continue paying tribute to public employee unions who can obtain amazing salaries and benefits from those they put into office on both sides of the aisle. We must continually seek independence.

BONUS: You are invited to enjoy a beach fire ring experience with my staff on July 20th (see MOORLACH UPDATE — Fire Rings — April 24, 2013 April 24, 2013April 24, 2013 John Moorlach). The event is free. There may be a cost for parking. The flyer is provided below.

State Rules County Violated Labor Laws When Passing COIN

By Nick Gerda

A state agency has ruled that top Orange County officials violated labor laws last year by imposing new requirements on employee negotiations, without giving unions a chance to negotiate about the changes ahead of time.

In a proposed decision by the state’s Public Employment Relations Board, the county was determined to have violated state law when supervisors passed the Civic Openness in Negotiations ordinance, known as COIN.

“The County is found to have adopted a proposed ordinance, COIN, without prior notice to [the Orange County Employees Association], [Orange County Attorneys Association], and [International Union of Operating Engineers Local 501], and affording them an opportunity to meet and confer over the decision or effects of the proposed ordinance. Such a violation constitutes an unlawful unilateral change and a refusal to bargain in good faith,” states the June 16 ruling by Chief Administrative Law Judge Shawn B. Cloughesy.

If the ruling stands, the county would have to repeal four key sections of COIN, including public reporting of offers and counteroffers, disclosure of what took place during labor negotiation sessions, a 30-day non-negotiations period before supervisors consider opening proposals to labor groups.

The county would also have to put up notices for 30 days telling employees the county broke the law and is required to meet and confer with unions before making changes that affect their representation. The notices would also have to be emailed to county employees.

The county has until next week to appeal the ruling to the full labor board.

County spokeswoman Jean Pasco declined to comment on the ruling, other than to note that supervisors took no reportable action on the litigation during their closed session last week.

Meanwhile, the Orange County Employees Association, which represents two-thirds of the county workforce, applauded the ruling.

“We’re really happy that the administrative law judge recognized and upheld worker rights in his proposed decision,” said Jennifer Muir, the union’s assistant general manager.

Muir went on to say it shows the need to apply transparency across the board at the county, not just to employee contracts. She pointed to recent cost overruns and network outages stemming from the county’s contract with Xerox Corp.

"There’s just example after example after example about how that type of public scrutiny on those private contracts is just critical for the public,” she said.

Among other things, COIN requires public disclosure of offers and counter-offers on labor contracts, a more detailed financial analysis of proposed agreements and the posting of proposed agreements 30 days in advance of voting on their approval.

It was brought forward to the county last year by then-Supervisor John Moorlach, who argued that it will give residents a better chance to weigh in on proposed labor agreements.

Supporters, such as the conservative Lincoln Club of Orange County, also suggested the ordinance would help prevent labor costs from escalating due to benefit increases.

Labor groups, meanwhile, argued that COIN triggers a requirement to meet and confer with employees under the Meyers-Milias-Brown Act, which mandates certain types of communication between government agencies and employee groups regarding labor negotiations.

They also criticized supervisors for not having the ordinance cover all government contracting, especially with private companies that finance the supervisors’ political campaigns and account for more than half of the county’s spending.

In reaction to COIN, OCEA is spearheading state legislation that would require any local government that implements COIN to also follow a similar process for contracts with private vendors over $50,000.

That legislation, known as CRONEY, was passed by the Senate in May and was approved by the Assembly’s local government committee on Wednesday.

You can contact Nick Gerda at ngerda, and follow him on Twitter: @nicholasgerda.

OC Register Logo

State attorney finds OC supervisors acted illegally in approving ‘COIN’ labor ordinance


Orange County leaders acted illegally when they failed to let unions try to negotiate new requirements imposed last year on county contract-negotiation processes, an attorney for a state agency has ruled.

The proposed ruling by an administrative law judge for the Public Employment Relations Board, issued June 16, could force the county to repeal key parts of the Civic Openness in Negotiations ordinance, dubbed COIN, which requires offers and counter-offers on labor contracts be publicized and requires more detailed analysis of the financial effects of proposed labor agreements, among other things.

The Board of Supervisors has not yet voted on whether to appeal the ruling.

If it doesn’t appeal and the ruling becomes final, not only would the ordinance be dismantled, but the county would be required to place notices that tell employees the county broke the law. The notices are to be displayed for 30 days, and each county employee is to receive one through email.

The ruling was prompted by an unfair labor practice filed last year by the Orange County Employees Association, the county’s biggest union.

County and union officials were not available for comment late Thursday.

The ordinance was introduced last year by state Sen. John Moorlach when he was a supervisor. A similar ordinance exists in Costa Mesa and is being considered in other cities.

Labor leaders cried foul when Moorlach introduced the ordinance, but Moorlach said the changes didn’t affect wages, hours and employment conditions so they weren’t subject to negotiation.

Human Resources Director Steve Danley agreed, saying the new law did not have a “significant and adverse” impact on wages or hours, according to the ruling.

The attorney for the labor board, however, disagreed and pointed to a list of past cases in which state officials established that ground rules for negotiations are a mandatory subject of bargaining.

“While the ground rules used during negotiations do not, on their face, directly affect employees’ wages, hours, or working conditions, the application of ground rules through the bargaining process would have a significant and adverse effect on wages, hours and working conditions,” according to the ruling, written by Chief Administrative Law Judge Shawn B. Cloughesy. “If a public agency is able to exercise overall control over the ground rules of bargaining, it can short circuit and frustrate bargaining to the point it ceases to be a bilateral process.”

The ruling will become final unless a party appeals within 20 days of service, according to the ruling.

Contact the writer: mcuniff or 949-492-5122. Twitter: @meghanncuniff.

This e-mail has been sent by California State Senator John M. W. Moorlach, 37th District.

If you no longer wish to subscribe, just let me know by responding with the request to do so.