The increasing cost of public employee retirement will not be a burden over the years for owners of River Islands at Lathrop when it comes to maintaining parks and general areas.
This is because all of the work to maintain 2,206,000 square feet of parkland, 776,000 square feet of pocket parks, 2,842,000 square feet of landscaping plots, 1,900,000 square feet of landscaping. road, 3,600 trees, 226,500 square feet of street sweeping and 21,360 square feet of noise barriers currently in place is awarded to a private contractor through the tendering process.
As a result, the River Islands Public Financing Authority, supported by community levies on public utilities capped at 2%, will not create pension and other charges for homeowners with respect to park and landscape maintenance.
Susan Dell’Osso, president of River Islands Development, said the overall design for community planning of 15,001 homes – including ongoing costs for homebuyers – was to provide the most robust community lifestyle. while reducing costs as much as possible.
This commitment included the provision of retail electricity service through the Lathrop Irrigation District at rates currently 5% lower than PG&E. The savings margin is expected to rise to 15% or more as more homes are occupied and PG&E continues to raise rates.
The approach contrasts sharply with some cities like Manteca.
In fact, Manteca at one point did what the River Islands Financing Authority does. All work in the city’s landscape maintenance district was tendered and awarded to private contractors who often paid many of their workers minimum wages. The city, like the River Islands funding authority, monitored the quality of the contractors’ work.
When Manteca quit awarding bids to private companies in 2010, it wasn’t to save owners money or because of quality work issues. It was to save the city’s jobs.
The Great Recession created a significant funding gap for the city, forcing them to consider cutting jobs. They saved a number of positions by asking city park employees to do LMD work and charge for the time – including salary costs – that they worked on the specific LMD.
In the early years, the city took over the LMD’s annual reports to council, explaining how they were able to reduce the need for manpower to work more efficiently without affecting the quality of work. This was necessary given that city workers at the time were paid 30 to 40 percent more than private sector workers employed in landscape-related work.
The shift from private companies to city workers has never addressed the unfunded costs of the California Public Employment Retirement System (CalPERS) that have become an issue in recent years.
Assuming that the costs are distributed proportionally over the LMDs, there will come a time when the current level of assessments, even with capped annual increases, will not be able to cover all costs.
This means that neighborhoods with common area landscaping and even park maintenance covered by a separate assessment will likely face service level reductions or will have to vote to assess themselves and their neighbors to a rate in excess of the annual inflation adjustments.
To contact Dennis Wyatt, email [email protected]