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Lack of Transparency and Voter Indifference Can Make a Big Difference
Thursday, July 29th, 2010
Robert Wechsler
Update: September 23, 2010 (see below)
Lack of transparency and voter indifference, especially relating to technical issues, are often considered minor issues not central to local government ethics. What happened the last few years in Bell, California (pop. 37,000; Los Angeles County) should make people think again about how central transparency and citizen participation are to preventing unethical conduct by local government officials.
Transparency
What happened in Bell is that its city manager and council members made outrageous salaries: nearly $800,000 for the city manager, $457,000 for the police chief, and $100,000 for each part-time council member.
The most important thing to have on a city's website is the city budget, a detailed, line-by-line version of its budget, and all proposed budgets, as well. Every town government with something to hide keeps its budget as secret as possible. The only way to get a budget online in my town was to put it online yourself. Unethical leaders can collude with auditors, they can keep government employees quiet, but they have no defense once a true and complete copy of the budget goes public.
Bell's website has no budget, no ordinances, and nothing to let anyone know the town is embroiled in the biggest new scandal in California. Click "What's New" and you'll find almost nothing.
Bell's council went beyond hiding the budget, however. The budget would say that they made only $1,800 a year each. But they arranged it so that they got a lot more from sitting on various bodies, such as the Public Financing Authority, the Surplus Property Authority, and the Housing Authority, each of which paid each council member $19,000. See an excellent analysis of their clever pay scheme in the Los Angeles Times.
Citizen Participation
According to another article in the Times, in 2005 there was a special vote in Bell to become a charter city. Only 400 people, that is, one percent of the city's population, voted in the special election. It just so happens that in 2005 the state limited pay for council members in general law cities. All of Bell's council members supported the charter city initiative that would allow them to keep, and even raise, their salaries. According to the article, "Some council members insisted that the ballot measure was not motivated by a desire to increase salaries — but did not cite any other ways the charter changed how Bell did business."
In effect, when citizens vote without knowing what or who they're voting for, or choose not to vote, they are enabling unethical behavior. They are telling unscrupulous people that they are chumps ready to be taken advantage of.
An even more serious problem is allowing people to run for office without opposition. According to the Wikipedia page on Bell, no council member was opposed in the decade preceding the 2007 election.
Now, everyone in Bell is up in arms. They feel they've been had. But in fact they placed too much trust in their representatives, and ignored the clear signs of a secretive administration, which focused on providing better services so no one would get upset.
Feeling Entitled
It appears that this wasn't just a scheme to take money from an ignorant electorate. According to another Times article, the mayor said that "the city was near bankruptcy when [the city manager] came aboard 17 years ago. Since then ... he has put Bell on sound financial footing, with its general fund nearly tripling to about $15 million. 'Our streets are cleaner, we have lovely parks, better lighting throughout the area, our community is better. These things just don't happen, they happen because he had a vision and made it happen.'" For more of this, see his press release dated July 23.
The police chief said he came out of retirement to end corruption in Bell's police department.
Feeling entitled not only justifies high salaries, but it is often accompanied by a feeling that you know, and the people don't, and therefore they don't even need to know what is happening. It's all for their own good, anyway. Those who don't appreciate all that's been done for them don't know what they're talking about (how could they? the facts aren't available), and they don't know how much worse it was and could be. They don't realize how lucky they are!
This sort of paternalism is at the heart of most fiefdoms like Bell. These aren't just crooks, they're people who feel entitled to more and more.
Repercussions
Today's L.A. Times has an article on the repercussions of the Bell scandal. Everyone suddenly wants to know what their officials are making, and little of this information is easily available online. In my town, for example, the former leadership said that town employees' salaries were personal and confidential. Do you want everyone to know what you make? A private salary is something you give up when you work in government.
Figuring out exactly how much top city leaders make can be difficult, however. Even when you can find the base salary, it's hard to work out an official's total compensation, including car and phone allowances, housing payments, deferred compensation plans, separate salaries for sitting on boards, not to mention health care, pensions, and perks.
"Take the case of Laguna Hills. Barbara Kogerman, who ran for City Council in the Orange County suburb, sought the assistance of three local graduate students to figure out how much City Manager Bruce Channing earned and how his pay compared to that of other Orange County city managers. Collecting the information was difficult, in part because each city offered data in a unique format, the students said."
But city managers are so concerned about the repercussions, they are meeting today in the state capital to discuss "damage control," including a possible database of municipal executive salaries. The state legislature is considering a requirement to post salaries on websites, and a cap on pensions, since the state handles local government pensions, and high salaries will mean high pensions in the future.
Another effect of the Bell scandal is to undermine cities' argument that they are suffering financially because of the economic slump and cannot afford deeper cuts in state subsidies.
Thanks to Christopher Bauer for bringing this matter to my attention in his blog post yesterday.
Update: September 23, 2010 (see below)
According to an article in today's Los Angeles Times, Bell's city administrator, mayor, and current and past council members have been arrested on counts that include misappropriation of public funds, falsification of public documents and conflicts of interest. The ringleader appears to have been the city administrator, but it seems that a large number of officials went along with the scam, which included loans, contracts, large increases in salaries, and large increases in taxes.
Robert Wechsler
Director of Research-Retired, City Ethics
---
Lack of transparency and voter indifference, especially relating to technical issues, are often considered minor issues not central to local government ethics. What happened the last few years in Bell, California (pop. 37,000; Los Angeles County) should make people think again about how central transparency and citizen participation are to preventing unethical conduct by local government officials.
Transparency
What happened in Bell is that its city manager and council members made outrageous salaries: nearly $800,000 for the city manager, $457,000 for the police chief, and $100,000 for each part-time council member.
The most important thing to have on a city's website is the city budget, a detailed, line-by-line version of its budget, and all proposed budgets, as well. Every town government with something to hide keeps its budget as secret as possible. The only way to get a budget online in my town was to put it online yourself. Unethical leaders can collude with auditors, they can keep government employees quiet, but they have no defense once a true and complete copy of the budget goes public.
Bell's website has no budget, no ordinances, and nothing to let anyone know the town is embroiled in the biggest new scandal in California. Click "What's New" and you'll find almost nothing.
Bell's council went beyond hiding the budget, however. The budget would say that they made only $1,800 a year each. But they arranged it so that they got a lot more from sitting on various bodies, such as the Public Financing Authority, the Surplus Property Authority, and the Housing Authority, each of which paid each council member $19,000. See an excellent analysis of their clever pay scheme in the Los Angeles Times.
Citizen Participation
According to another article in the Times, in 2005 there was a special vote in Bell to become a charter city. Only 400 people, that is, one percent of the city's population, voted in the special election. It just so happens that in 2005 the state limited pay for council members in general law cities. All of Bell's council members supported the charter city initiative that would allow them to keep, and even raise, their salaries. According to the article, "Some council members insisted that the ballot measure was not motivated by a desire to increase salaries — but did not cite any other ways the charter changed how Bell did business."
In effect, when citizens vote without knowing what or who they're voting for, or choose not to vote, they are enabling unethical behavior. They are telling unscrupulous people that they are chumps ready to be taken advantage of.
An even more serious problem is allowing people to run for office without opposition. According to the Wikipedia page on Bell, no council member was opposed in the decade preceding the 2007 election.
Now, everyone in Bell is up in arms. They feel they've been had. But in fact they placed too much trust in their representatives, and ignored the clear signs of a secretive administration, which focused on providing better services so no one would get upset.
Feeling Entitled
It appears that this wasn't just a scheme to take money from an ignorant electorate. According to another Times article, the mayor said that "the city was near bankruptcy when [the city manager] came aboard 17 years ago. Since then ... he has put Bell on sound financial footing, with its general fund nearly tripling to about $15 million. 'Our streets are cleaner, we have lovely parks, better lighting throughout the area, our community is better. These things just don't happen, they happen because he had a vision and made it happen.'" For more of this, see his press release dated July 23.
The police chief said he came out of retirement to end corruption in Bell's police department.
Feeling entitled not only justifies high salaries, but it is often accompanied by a feeling that you know, and the people don't, and therefore they don't even need to know what is happening. It's all for their own good, anyway. Those who don't appreciate all that's been done for them don't know what they're talking about (how could they? the facts aren't available), and they don't know how much worse it was and could be. They don't realize how lucky they are!
This sort of paternalism is at the heart of most fiefdoms like Bell. These aren't just crooks, they're people who feel entitled to more and more.
Repercussions
Today's L.A. Times has an article on the repercussions of the Bell scandal. Everyone suddenly wants to know what their officials are making, and little of this information is easily available online. In my town, for example, the former leadership said that town employees' salaries were personal and confidential. Do you want everyone to know what you make? A private salary is something you give up when you work in government.
Figuring out exactly how much top city leaders make can be difficult, however. Even when you can find the base salary, it's hard to work out an official's total compensation, including car and phone allowances, housing payments, deferred compensation plans, separate salaries for sitting on boards, not to mention health care, pensions, and perks.
"Take the case of Laguna Hills. Barbara Kogerman, who ran for City Council in the Orange County suburb, sought the assistance of three local graduate students to figure out how much City Manager Bruce Channing earned and how his pay compared to that of other Orange County city managers. Collecting the information was difficult, in part because each city offered data in a unique format, the students said."
But city managers are so concerned about the repercussions, they are meeting today in the state capital to discuss "damage control," including a possible database of municipal executive salaries. The state legislature is considering a requirement to post salaries on websites, and a cap on pensions, since the state handles local government pensions, and high salaries will mean high pensions in the future.
Another effect of the Bell scandal is to undermine cities' argument that they are suffering financially because of the economic slump and cannot afford deeper cuts in state subsidies.
Thanks to Christopher Bauer for bringing this matter to my attention in his blog post yesterday.
Update: September 23, 2010 (see below)
According to an article in today's Los Angeles Times, Bell's city administrator, mayor, and current and past council members have been arrested on counts that include misappropriation of public funds, falsification of public documents and conflicts of interest. The ringleader appears to have been the city administrator, but it seems that a large number of officials went along with the scam, which included loans, contracts, large increases in salaries, and large increases in taxes.
Robert Wechsler
Director of Research-Retired, City Ethics
---
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