Wisconsin Events Don't Affect Pension Reform

While the Tea Party and others who do not value government may be rejoicing at the oppressive tactics of Wisconsin's governor, the effect here in California may be very different, although equally negative. Most Californians probably see Governor Scott Walker's tactics for what they are—a blatant attempt to hobble government, cripple unions, and ultimately, undercut the Democratic Party. It goes without saying that Governor Walker's actions are deeply polarizing, and, by cutting off communication between workers and the State, anti-democratic.

Many in the union movement fear that Governor Walker's actions will have a domino effect, and encourage other states to eliminate unions' bargaining rights. However, the danger nationally is just the opposite: despite the urgent need to solve the current pension and health benefits crisis , elected leaders who are beginning to address this crisis will shy away, for fear of being branded Walker "clones." And some unions may be tempted to take advantage of this "Wisconsin Effect," to put off the hard discussions on pension reform.

While both supporters and opponents of government may agree that pension reform is essential, they support pension reform for different reasons. The Tea Party is intent on reducing both the size and cost of government. Pension reform is one way to do that. However, progressive Democratic leaders support pension reform for a very different reason: because pensions and retiree health benefits are "crowding out" essential governments services, from police and fire, potholes and education, to the social "safety net." This is a very important distinction.

What can't be disputed is that in order to save local and state governments, pension reform is absolutely essential, and it must happen now.

It is not a matter of blame. Public unions are not villains for having sought better retirement benefits. One could blame the politicians who granted the benefits, but the truth is very few leaders understood the consequences of their actions at the time. And, of course the entire pyramid scheme on which enhanced public pensions were based was the financial markets – which, it turns out, was manipulated by financial gurus whose incentives ran only toward their own greed. We should not have been fooled; but, of course, almost everyone was.

For unions, there is a message as well. The Wisconsin unions are willing to contribute more towards their pensions and benefits. But it should not have taken the draconian threat of losing collective bargaining rights to obtain this agreement. Although it is not easy for union leaders to convince their rank and file to pay more for their benefits, it is important that they do not treat the current problem as a typical negotiation in which the less the employees "give," the better the deal. The unions' interest in saving jobs and services is at least as great as the public's. The jobs we are going to lose are union jobs; the services we are going to lose will hurt everyone, including union members.

The political outcome from Wisconsin won't change the fact that local and state governments are in deep trouble. Most governments will not declare bankruptcy; unlike Vallejo, they will just become increasing less able to provide basic services if we cannot take on the hard issues of pension reform. The "Wisconsin Effect" is no excuse for delay.

Jeff Adachi is SF's Public Defender. Feedback: adachi@westsideobserver.com

March 2011

 

Public Defender Jeff Adachi

Fixing Our City's Broken Pension System

San Francisco is facing a fiscal crisis that threatens the quality of life for all San Franciscans and the future of our children. The Civil Grand Jury called it a "Pension Tsunami." The most recent financial data shows that our city is facing a $400 million dollar deficit, while pension costs paid to city employee retirees will balloon to $423 million this year, $109 million more than last year. But what's most frightening is that these costs will increase by $100 million a year, until we are spending one-third of our city's budget for benefits for city employees and retirees. A study by a pension expert puts the City's unfunded benefits liability at a cost of $35,000 for every San Francisco household.

This is not a problem just facing San Francisco. Cities and states throughout the country are facing insolvency due to out of control pension costs and unfunded liabilities. But because our pension system is better off than most, we can take steps to fix this and avoid the crisis. But we have to act now.

The cost of not acting will mean even deeper cuts to education, public safety, health, senior and children's services. Education has been cut by 25%. Summer school has been cut for 10,000 kids for two years in a row, and school bus services have been cancelled. The Parks and Recreation budget has been slashed by nearly 50% in the last year. Children's and senior programs have been cut by 20%. In 2012, the fiscal cuts will be even more severe, with even more funding cuts coming from the state.

It's time to reform our city's pension & benefits system. San Francisco is fortunate. We haven't suffered the extent of the losses in property taxes that other counties have. We still have a vibrant business community that has suffered from the economic downturn but still produces good jobs and industry. We have not yet suffered the mass layoffs of city workers that many municipalities have. Our city employee pension system is still salvageable. But if we fail to act now, we will soon join the list of failed states and cities that are verging on bankruptcy. We cannot allow another year to pass without reforming our city's pension and benefits system.

How can the problem be fixed? Fixing the problem requires changing the City's Charter to ensure that the pension and retirement system is sustainable. This will require a combination of cost-saving measures, both by the City and public employees, to control the cost of pensions and benefits. A change to the City's Charter may be placed on the ballot by the Board of Supervisors and/or mayor, or may be placed on the ballot through a petition signed by 10% of the city's electorate.

With a new Mayor and Board of Supervisors, San Francisco has the opportunity to look at this problem anew and define an innovative, bold solution that will truly and realistically address this crisis. However, it is important that the public be informed of the choices we now face, and be part of the debate and solution. And if the elected officials are cannot design a comprehensive solution to this crisis, the electorate must act.

SF SMART Reform has taken the feedback from our membership and dozens of pension and benefits experts and drafted a series of principles and policies to guide reform. We hope that the principles invite and encourage debate and invite all comments that move this important issue forward. These comments will be used to improve and revise the measure, which we will release in the coming weeks for public review and comments. Our goal is to create the most effective and fair Charter Amendments, both for San Franciscans and city workers.

Ideas to Achieve Comprehensive Pension Reform SF SMART Reform offers the following policy directives to bring about changes in our Pension System in three critical areas. True pension reform must:

(1) Reduce the burden of retiree pensions on taxpayers by: (2) Eliminate pension spiking and accrued pay resulting in higher pensions by: (3) Improve public account-ability and
transparency of the pension fund by:

✓Requiring existing and future employees pay at least one-half of the cost of their defined pension contributions.

(Currently, city employees pay between 0-7.5% of their salaries into the pension fund. Some new employees hired after July 2010 pay 9%. However, the City now pays 18% and in four years, will pay 28%.)

✓Change the pension benefit for new employees, capping defined benefit pensions at no more than $90,000 per year. In addition to the defined benefit, employees will have a 401K where the City contributes a fixed amount to the employee's 401K.

(A police employee who earned $150,000 a year would qualify for a pension not to exceed $90,000 and would have a 401K plan with combined employee and city contributions.)

✓Eliminating supplemental "Bonus" COLAs (cost of living increases) for all city employees.

(City employees will no longer receive a bonus retirement above and beyond cost of living increases as they do now.)

✓ Increasing the retirement age for new employees to receive full retirement benefits to 65 for non-public safety employees and 56.5 for public safety employees.

✓For new employees, use an average of the employee's last five years of employment to rather than the last year or two years to determine the amount of the pension. (An employee who was promoted in her last year of employment to a higher paying position would receive a pension based on the average of her last five years of employment, rather than her last year.) ✓Using the employees' base pay only to determine pensions, and exclude pension increases for salary increases due to premium pay, retention bonuses, training pay and other pay increases not related to a promotion to a higher job class. (A city employee qualifies and receives a salary increase due to retention bonuses or participating in special training. The employee still receives the salary bump, but the increase is not included in determining the pension the employee receives upon retirement.)

✓Requiring the pension fund to report on its current unfunded liability, the fair market value of the assets available to pay that liability, the schedule of employer/employee contributions and the projected cost to the City and to the employee. The report should also include actuarial assumptions for the plan year as well as the return on investment for the plan year, a statement of the plans investment returns for each of the 5 preceding years. The report shall also include a list of the pensions paid by the City to individual employees.

✓The City will create and maintain a public website with searchable capabilities, posting the information in the report.

✓Create policy of accurately and honestly reporting on the financial liabilities of public pension costs.

These three priority areas provide an outline reforms necessary to bring the City's fiscal health back into shape. These ideas are offered for discussion. Making these changes won't be easy. Elected officials must look beyond the next few months and years to ensure the long term future stability of our City. And the cost savings will help ensure that all San Franciscans, including city workers, receive the services they need in these difficult economic times.

Please post your comments and ideas to our website at www.sfsmartreform.com or email us at sfsmartreform@yahoo.com. We will review your comments and consider any and all ideas in developing SF SMART Reform's action plan. Thank you.

February 2011

Next Steps In City Pension Reform

Although Proposition B did not pass in November, 110,000 San Franciscans who voted YES ON PROP B understood why changes to our pension and health care costs have to be made to protect vital services and sustain our city’s pension and benefits system for its employees.

It is just a matter of time until the rest of the citizenry will see that we must act now in order to save our city government and the basic services we all rely upon. This is because the financial sinkhole of escalating city employee pension and benefits costs will only continue to worsen.

Over the next twelve months, the city’s benefits costs for city employees will soar by $130 million more than the $829 million we spent this year, and the city’s unfunded liability for city employee health care costs will grow by $300 million more. At the same time, the city faces a $400 million deficit next year. These costs will continue to climb, consuming scarce funding to support education, law enforcement, parks and recreation programs, public health and other basic services.

Labor leaders have promised to solve this pension and health care benefits problem in the upcoming year. But it remains to be seen if real reform will occur, or whether, as in the past, expensive trade-offs will be made that wipe out any potential benefits from the reform.

How will we know that a proposed effort to reform the city employee’s pension and benefits system truly addresses the problem?

First, any solution must offset the city’s cost to the pension fund and result in immediate savings in order to address the city’s current fiscal crisis. Proposition B would have resulted in immediate savings of $121 million each year, every year. Any solution proposed must provide similar immediate relief. The only way to achieve this is to increase contributions by existing employees to their pensions without providing a concurrent increase in wages. For example, in 2010, the Mayor and the Board of Supervisors agreed to give 10,000 city employees a 6% raise in exchange for a 7.5% contribution towards their pensions. This agreement actually exacerbated the city’s pension problems, since the taxpayers are on the hook not only for the 6% raise, but also for a 6% pension increase when the employees who received the raise retire. This “raise” will continue to cost taxpayers hundreds of millions of dollars in the future.

Second, any real solution must increase the employee share of the health care costs. Currently, city employees pay nothing for their health care costs, while the City pays 100% of the employees’ health care, and pays 75% of their family’s health care costs. Proposition B would have required city employees to pay anything above 50% of their dependent’s health care, using the lowest cost plan. During the campaign, Prop B opponents claimed that these changes were too drastic. A possible compromise solution would be to require city employees to pay at least 50% of the cost of the dependent’s health care plan they currently use, or to require that city employees earning above a certain income level to pay more for their health care costs. However, these would not come close to the $80 million in annual savings that Prop B would have realized.

Third, retiree pension and health care costs have to be addressed. While a retiree’s pension is treated as a vested right, their health care costs are not. For retirees, retirees’ health care costs are set by the Charter. A similar provision could require a higher health care contribution by retirees who receive higher-end pensions or choose more expensive health care plans.

Fourth, police and fire employees should be required to contribute more to their pensions than other city employees. This is because their pension costs as well as the benefits they receive are much greater. Police and fire employees are able to retire at 55 years of age with 90% of their last year’s income, while other city employees retire at 62 with 75% of their last year’s income. According to CALPERs, the state’s public safety pension fund, police and fire employees live just as long as other public employees, and thus, their pension costs are being borne by other city employees who must contribute equally to the pension fund. 2002’s Proposition H requires the police and fire to enter into a cost-sharing agreement with the city to bear their share of the cost of these enhanced benefits. It should first be determined what the real cost of these benefits are, and a fair amount, such as 50%, should be contributed by police and firefighters to their pensions, over and beyond what they currently pay.

Finally, for new employees, the city should consider increasing the retirement age, and explore the fiscal impact of combining a defined pension program with a 401K. Pensions should also be capped at a certain amount to avoid adding new members to the $200,000 pension club. Currently, over 100 public safety officers earn over $247,000 a year. They will each earn an annual pension which is 90% of their last year’s income upon their retirement. Pensions were never meant to provide an extravagant income to city employees, even those who are high earners. These extravagant pensions should be capped at a reasonable amount, so that employees can still earn good incomes, but not retire with $150,000-$250,000 annual pensions. Also, multipliers which increase pension costs, such as salary bumps for retention and training, should not be included in their pension payouts.

And what will happen if the City is unable to develop real reforms that offer real relief to the city’s financial crisis?

San Franciscans for SMART Reform will begin collecting ideas for the next Charter Amendment reform. To join our effort, please visit www.sfsmartreform.com and find out how you can participate. We also encourage your feedback on these proposals and other ideas you may have on how to reform our city’s pension and benefits system to protect vital services. You can also email us at sfsmartreform@yahoo.com. Thank you.

Jeff Adachi is the San Francisco Public Defender. Feedback adachi@westsideobserver.com

December 2010

Escalating City Pension And Benefits Costs

Almost a year ago, I wrote the first in a series of articles about the city’s escalating pension and health care costs for the Westside Observer. I didn’t know it then, but it started a movement to reform our public benefits system, known now as Prop B, which the voters will decide on November 2.

I had met with several members of the Civil Grand Jury who had authored a report entitled, “Pensions: Beyond Our Ability to Pay,” where they detailed how the city’s retiree pension liability had nearly tripled in the past five years. Even worse was the City’s growing health care liability, which had ballooned to $4 billion in unfunded health care costs for 26,000 city employees, 28,000 retirees and their 47,000 dependents. And these costs, according to the City Controller, would double in the next five years.

One year later, the pension and benefits tsunami continues to grow. We are spending nearly a billion dollars on pension and health care costs for our city employees. One out of every six dollars available to the city now goes to city employee benefits. By this time next year, it will have grown another $50-$70 million.

The problem with pensions has grown so bad that the public employee union leaders opposing Prop B don’t even argue against the Prop B’s common-sense pension reforms. After all, an employee who pays 9%-10% into their pension for a guaranteed, life-time pension upon retirement which equals 75%-90% of their last year’s income has a deal that no one in the private sector would even dream of. In order to receive the pension that a public sector employee receives, a private sector employee would have to save 65% of their paycheck.

Instead, opponents have focused on the health care component of Prop B, arguing that Prop B is “bad medicine” because it requires city employees to pay more for their health care.

But a close review of the facts shows that under Prop B, city employees will still receive health care premiums at rates unparalleled in the private sector.

…most city employees do not contribute anything for their own healthcare. Taxpayers subsidize the entire cost, between $2,890 to $5,560 per year for each employee.
Prop B would change this by requiring that an employee insured under the basic health plan pay just $96/year ($8/month) for their healthcare. Under Proposition B, city employees would still pay more than 22 times less than private sector employee, who, on average, pays $2,185 per year for their health insurance.

City employees with dependents currently pay $8 a month. Under Prop B, they would pay $2988 per year. Private sector employees with dependents pay an average of $7,026 a year. And this does not include the 31% of San Franciscans who do not receive employer-paid health care costs and pay the entire cost themselves.

Opponents of Prop B claim that city workers cannot afford to pay the health benefits if Prop B passes. Their argument ignores the fact that the average San Francisco city employee earns $93,000 a year in salary alone, not including benefits, while the average private sector salary is $46,000.

They also argue that “a single mother will be forced to pay up to $5,600 per year for her child’s health care — in addition to the $8,154 she already pays.”

First, this is not true. A city employee with two dependents only pays a total of $448 a month for full health coverage. Only if the city employee chose the most expensive health plan, which costs $31,645, would the employee have to pay $19,561 a year under Prop B instead of the $16,922, which he or she now pays.

What the opponents conveniently fail to point out is that out of 26,000 city employees, there are only 91 employees who are enrolled in this “Rolls Royce” rate plan.

Even with contributions required by Prop B, City employees will receive a benefit package that is unparalleled in the private sector. More importantly, however, the City’s healthcare fund will be made more sustainable by ensuring that the funding for the city’s healthcare program doesn’t run dry when the city can no longer afford to pay these costs.

According to the Controller’s ballot statement, Proposition B would save the City $121 million annually. Some of these funds could be used to prevent the devastating cuts to the City’s mental health, substance abuse, and other community health programs for poverty-stricken adults and children who do not have healthcare coverage. Next year’s deficit looks worse, and we won’t be able to count on federal stimulus funding to save us.

Voting yes on Prop B is an antidote to continuing cuts to healthcare for the poorest San Franciscans.

Jeff Adachi is the proponent of Proposition B and the city’s Public Defender. Feedback: adachi@westsideobserver.com

October 2010

SETTING THE RECORD STRAIGHT:

THE FACTS ABOUT HEALTHCARE UNDER PROP B

Proposition B, which will be on the ballot in November, addresses not only the City’s escalating pension costs for city employees, but also health care costs. There are two provisions to the measure. The first requires all city employees, including elected officials, to contribute between 9-10% towards their retirement pensions. Currently, nearly half of City employees do not contribute towards their pensions. The second requires that city employees contribute more towards their family’s health care costs.

Here are the facts about the cost of health care to taxpayers for the city’s 26,000 employees and 28,000 retirees:

• Currently, the City is spending $456 million for city employee and dependent health care each year. According to the City Controller, this number is expected to double within five years.

• The Controller estimates that the City’s retiree unfunded health care liability is growing by $300 million annually.

Under Proposition B, all City employees and retirees will continue to receive 100% of their healthcare benefits paid. However, instead of the City paying 75% of dependent health care costs, all City employees will share 50-50 in the cost of the healthcare for their dependents.

THE WAY IT IS NOW - Under the lowest cost health plan:

• A city worker with no dependents pays nothing for his or her healthcare and the City pays $481.70 per month.

• A city worker with one dependent pays $8.84 per month and the City pays $953.50 a month.

• A city worker with two or more dependents pays $228 per month and the City pays $1,132.54 a month.

• All of these payments into healthcare by city employees are with pre-tax dollars.

UNDER PROPOSITION B:

• A city worker without dependents would still pay nothing.

• A city worker with one dependent would pay, on average, $241.76 per month.

• A city worker with two dependents would pay $439.79 per month.

(Sources: City Controller, Department of Human Resources, Health Service System)

COMPARED to what the average private sector employees receive:

• Only 60% of San Francisco businesses offer health care benefits for employees.

• Private sector employees with no dependents who do receive health care must pay an average monthly cost of $402 (compared to City employees who contribute nothing) and pay $1,114.58 with dependents.

• And while 100% of public sector employees receive retiree health benefits, only 29% of private sector employees receive such benefits.

Keep in mind that the average San Francisco city employee earns $93,000 a year, not including benefits, compared to $46,000, which is what the average private sector employee who works in San Francisco earns.

According to the Health Service System, Proposition B would save the City $83.3 million annually in health care costs. Some of these funds can be used to preserve health programs for the vulnerable adults and children who do not have health care coverage.

Even with these changes, City employees will receive a benefit package that is unparalleled in the private sector. More importantly, however, the City’s health care fund will be made more sustainable and the savings from this measure will help preserve the essential services that are relied upon by all San Franciscans.

Opponents of Prop B have said.

In the voter’s guide, the opponent’s argument states that Prop B “cuts health care benefits for widows and children of police officers or firefighters killed in the line of duty.” This is untrue. Under California state law (section 4856 of the Labor Code, passed in 1997) families of deceased public safety officers are entitled to receive health benefits “under the same terms and conditions prior to the death of the employee.” Proposition B does not change this. In addition, under the federal Public Safety Officers’ Act, widows and children of police officers and firefighters killed in the line of duty receive $275,000.

The opponents have also declared that Proposition B fails to “distinguish between low-wage and highly-paid workers.” San Francisco has never based contributions by city employees on the income level of its employees. All employees have always paid the same amount, regardless of their income level. Proposition B does not change this.

The opponents also say that Proposition B “makes San Francisco ineligible for $23 million a year in federal health care reform funding.” This is not true. Nothing in Proposition B makes San Francisco ineligible for federal reimbursement of health care costs.

Proposition B creates a reliable, annual funding stream of support as opposed to “one time” savings measures and uncertain state and federal revenue that San Francisco can’t always count on.

This is why 49,178 San Francisco voters signed the petition to put Proposition B on the ballot.

VOTE YES on Proposition B!

Jeff Adachi is the elected Public Defender of San Francisco For more information, please visit www.sfsmartreform.com to help on the Prop B campaign, call (415) 905-9100.

Sept 2010

Time To Take Action:

SF’s Broken Pension System Is Breaking Us!

San Francisco is at a crossroads. There’s a fiscal train wreck just around the corner. In fact, it’s already here. With our city’s failing infrastructure and roads, a $787 million deficit next year, $1.2 billion in city employee pension costs that are projected to double in five years, the term “go for broke” takes on a new meaning. Will San Francisco become the next Vallejo?

Not if San Franciscans for SMART Reform is successful in getting San Francisco’s finances back on track. SF SMART Reform is a a coalition of community, neighborhood and business leaders committed to Sustainable, Measured, Accountable, Result-oriented and Transparent (SMART) reform.

“In order to put this measure on the ballot, SMART Reform needs to gather 46,000 signatures of San Francisco voters by July 1, 2010. Because we do not have thousands of dollars to spend, we must rely on citizens like you to help gather the signatures. We are asking each concerned citizen to help fill out just one petition, signed by you and 10 of your friends.”

Last month, SF SMART Reform embarked on its first project: putting a measure on the November ballot to reform the city’s retiree and health care benefits for city employees. The proposed charter amendment, known as the “Sustainable City Employees’ Benefits Reform Act,” would require all city employees to pay 9-10% into their pension funds, without changing their pension benefits. It also requires city employees to pay 50% of their family’s health care cost instead of 25%.

In order to put this measure on the ballot, SMART Reform needs to gather 46,000 signatures of San Francisco voters by July 1, 2010. Because we do not have thousands of dollars to spend, we must rely on citizens like you to help gather the signatures. We are asking each concerned citizen to help fill out just one petition, signed by you and 10 of your friends. You can request a petition by visiting our website or can download a petition at www.sfsmartreform.com. There is also a copy of the petition included in the home delivered Westside Observers.

As the author of the measure, I have had the opportunity to meet and speak with many voters about why this measure should be passed. Here are the common questions that people have about the measure:

Why Is It Necessary To Put A Pension Reform Charter Amendment On The Ballot?

San Francisco’s pension and health care costs for its city employees has been rising exponentially. From $175 million just five years ago, the city must pay $525 million this year. Within two years, the city will be paying $675 million. This is because whenever the city’s pension system loses money, taxpayers must make up the difference.

I’m Not A City Employee. Why Should I Care About The Cost Of Employee Pensions?

The rising cost of city employee pensions should be of concerned to anyone who lives or works in San Francisco. The quality of life in our city is directly tied to funding that is available to pay for essential city services, such as street cleaning, parks, health care and schools.

What Will Happen If Pension Costs Continue To Rise?

If the City’s revenues remain stable, the costs of pensions will eventually rise to the point that the city is unable to pay. Currently, the costs the city must pay towards pensions are about 13.5% of salaries ($525 million); by 2015, the city will be paying 25% ($812 million).

What Would This Charter Amendment Accomplish?

This Charter Amendment would require that city employees make additional contributions to their pensions. Most employees now pay between 0 and 7.5% of their pay into the pension fund. This would require police and fire employees to pay 10% and all other employees to pay 9%. It would also require employees to pay 50% of the cost of health care for any dependents. Currently, the City pays 75%. 100% of the health care costs of the employee would still be covered.

How Much Would This Measure Save Taxpayers?

This measure will help save approximately $170 million annually. The Controller, who is in charge of overseeing the City’s finances, will provide a cost-savings analysis in the ballot statement.

Would This Charter Amendment Reduce A City Employee’s Pension Upon Retirement?

No. City employees would still receive the pension benefits they were promised when employment was accepted. However, the amount that employees contribute to their own pensions would be increased to help off-set the city’s pension costs.

What Type Of Pension Do City Employees Receive?

City employees receive a defined pension benefit. Upon retirement, they receive a guaranteed income based on the number of years of service. Most receive lifetime health benefits, based on the years of service.

Should City Employees Be Supportive Of This Measure?

Yes. Currently 40% of the City’s workforce is eligible to retire. If the City’s pension costs continue to rise, the City will eventually be unable to pay its pension costs. At this point, the City can declare bankruptcy, as Vallejo did, and attempt to renegotiate its contracts and pension obligations with its employees. This is a preventative measure that will help San Francisco avoid Vallejo’s fate.

What Can I Do To Help?

We need your help to collect the signatures necessary to place this measure on the ballot and to contribute to our efforts. If you receive the Westside Observer at home, there is a copy included with your paper. Visit our website at www.sfsmartreform.com to find out how you can help. Completed petitions should be sent no later than June 30, 2010 to: SF SMART Reform, PO Box 77313, SF, CA 94107. Thank you!

Jeff Adachi is the elected Public Defender.

June 2010

Will You Help Save Our City?

Sustainable City Employees’ Benefits Reform
Measure Slated for November Ballot

In the February issue of the Westside Observer, I wrote about the need for San Francisco to reform its pension system. I noted that while our City is facing a $522 million dollar budget deficit, we are paying $525 million in retiree pension and health care costs. According to projections by the City’s retirement board, the city’s annual pension costs will balloon to $818 million in 2016.

At the same time, the City currently has an unfunded liability for retiree health insurance of $4 billion. The City’s retiree health care liability grew by over $300 million in the past year alone, and is likely to grow by even larger amounts in the future.

It won’t be easy to confront this problem. There is a reason why most politicians won’t touch pension reform. But the reality is that if we don’t figure out how to sustain our city’s pension system without bankrupting the City, San Francisco is in danger of becoming the next Vallejo or Los Angeles. In declaring that his city’s “pension system is no longer sustainable,” Los Angeles Mayor Antonio Villaraigosa vowed to support pension reform after announcing that city services would be closed two days a week, thousands of city employees would face layoffs and that his city could face bankruptcy.

The City’s pension system is like a reserve tank that has to be filled every year. If you work in the private sector, and are fortunate to have a 401k plan and your investments are down 30%, your retirement takes a 30% hit. When the City employees’ pension fund suffers a loss, under the City Charter, the taxpayers have to fill up the tank every year so that the fund is funded. So, this year, the taxpayers will pay $525 million. Next year, the bill is $625 million, and the year after the bill will be $675 million.

“The Charter Amendment does not change or modify the benefits the employee receives upon retirement. It only changes the amount that existing city employees are required to contribute. And it will ensure that when employees do retire, there are sufficient funds in the
pension fund to fund their pensions.”

All City employees receive a defined guaranteed benefit upon retirement, and the City is obligated to pay whatever it costs to meet that obligation. Employees contribute between 0-7.5% to their pension funds, and the City’s share is now 13.5%. By 2016, the City’s share will be 25%.

City departments have already been slashed and are facing more cuts because the City doesn’t have enough money to run its basic operations. Spending set-asides, another needed reform that I have written about, require the city to spend about 4/5 of its budget according to spending formulas decided by the voters in better times. This leaves only 1/5 of our city’s $6.6 billion dollars available for critical services, such as public health, public safety and public defense.

It is for this reason that I am joining with others to place a Charter Amendment on the ballot in November. This Charter Amendment is called the “Sustainable City Employee Benefits Reform Measure.” This measure will require city employees to contribute 9-10% to the pension fund to make it sustainable, and prevent pensions costs from bankrupting San Francisco or forcing additional cuts in essential public services. The measure also requires a 50/50 share for health care costs for dependents. City employees now receive 100% city-paid coverage but pay 25% of the cost for any dependents. Under the proposed Charter Amendment, employees still receive 100% coverage, but will pay 50% for dependents.

The Charter Amendment does not change or modify the benefits the employee receives upon retirement. It only changes the amount that existing city employees are required to contribute. And it will ensure that when employees do retire, there are sufficient funds in the pension fund to fund their pensions.

The issue of pension reform is one of city-wide, state-wide and national importance. The City’s pension problem can be fixed, but we need to take preventative action now. If we wait any longer, we will join Los Angeles, San Diego, San Jose, Contra Costa County and other counties teetering on the brink of bankruptcy due to out-of-control pension costs.

The future of our city depends on your participation and support. To obtain a petition to help collect signatures for the proposed ballot measure by the July 1st deadline, please visit www.sfsmartreform.com, call 415 905-9100 or write to: San Franciscans for SMART Reform, POB 77313, SF, CA 94107.

Jeff Adachi is the city’s elected Public Defender.

May 2010

Why San Franciscans Must Support Pension Reform

Next year, San Francisco city government faces a budget deficit of $522 million. At the same time, the city’s retiree pension and health care premium costs have shot up to $525 million this year, up from $175 million just five years ago. By 2013, the city will have to pay $675 million in retiree pension and health care costs—the same amount it costs to operate San Francisco General Hospital for one year.

Upon retirement, San Francisco’s city employees receive a guaranteed pension, based on their years of service. For this benefit, most employees contribute 7.5 percent of their paychecks into a retirement fund. Under the city charter, the city is required to pay the difference whenever the pension fund suffers losses. When the financial markets crashed, the city’s annual contribution to the fund rose 200% from five years ago.

Yet every year, city officials have negotiated pay raises and benefits that have increased the city’s pension costs. How did this happen? As former Mayor Willie Brown recently explained, “We politicians, pushed by our friends in labor, gradually expanded pay and benefits … while keeping the job protections and layering on incredibly generous retirement packages.” Just two years ago, city officials voted to give a 25% wage increase to police officers at a cost of $64 million and a 19% increase to registered nurses at a cost of $39 million.

However, politicians aren’t the only ones to blame: Most of the benefit expansions were approved by voters.

Take Proposition H, which allowed police and firefighters to receive 90% of their last salary at age 55 with 30 years of service. Voters approved the measure, but had been told there would be little fiscal impact on the city’s coffers. According to the ballot statement, “No cash would be required since the city’s retirement system currently has a large surplus. While the cost of this proposal would reduce that surplus, the city nonetheless should be not required to pay employer contributions to the retirement system for at least the next ten years.” Within two years of the measure, the city was paying $175 million into the fund.

Voters also weren’t told about the effect of pension spiking. Last year, the city’s civil grand jury issued a report finding that the SFPD and SFFD systematically promote employees in their last year of service to increase their pensions. The grand jury cited an example of one high ranking police officer who was promoted to a temporary position in his last year, which resulted in a $25,000 increase in his annual pension upon retirement. This practice has cost the city $132 million.

San Francisco isn’t alone in facing these challenges. All around the nation, cities, counties and states are struggling against escalating retiree pension and health care costs. According to a study released last month by the Pew Center on the States, state governments nationwide have promised to deliver $1 trillion more in retirement benefits than they have in their pension funds.

Some states, including New York, Ohio and Massachusetts, have enacted laws to restructure their pension systems. Many California counties, such as Orange County, San Diego and Contra Costa, are taking steps to avoid the fate of Vallejo, which declared bankruptcy after it could not pay its pension costs.

District 7 Supervisor Sean Elsbernd recently introduced a charter amendment that would reduce pension spiking and require public safety employees hired after the measure passes to contribute 1.5% more to their pension plans. Although the measure will have little effect on the city’s current pension crisis, it takes an important step by curbing pension costs for future employees. However, city leaders must begin proposing additional common sense solutions to ensure that the city is able to pay its current pension liabilities without bankrupting city services.

Of the city’s $6.7 billion budget, over $5.5 billion funds enterprise departments like the airport and PUC as well as mandatory spending set-asides. This leaves a little more than $1 billion to fund city services, including public health and the public defender’s office. With over $525 million going to pensions next year, the city won’t have much choice but to lay off hundreds of workers and impose additional furloughs, which reduces city services to residents. Ironically, as more workers are laid off, there are fewer employees who can contribute to their pension funds, which increases the city’s pension liability.

Even those city workers close to retirement age should support pension reform. With over 40% of the current workforce eligible to retire, the city will eventually run out of money to pay its pension liabilities. Existing employees should also support this effort since most do not engage in pension spiking but must shoulder the burden for those that do. Existing employees have the most to lose, because it is they who will face mass layoffs caused by the city’s growing deficit. And finally, voters must recognize that the more money that is poured into pensions, the bigger the cuts will be to critical services such as police, fire and public health, and to the city’s infrastructure, including fixing its parks and potholes.

Jeff Adachi is San Francisco’s Public Defender.

March 2010

Solving San Francisco'sBudget Problems

How would you act if you knew that your household spending was projected to outpace your earnings? You would cut back on vacation plans, dining out, and other unaffordable spending. You would figure out what you could and could not live with, and make the necessary adjustments.

Unfortunately, San Francisco’s city government has not done this. For the tenth consecutive year, the city faces a growing budget deficit. Next year’s deficit is projected to be $522 million. In addition, a $53 million dollar shortfall is expected in the current fiscal year. But this is not because there isn’t enough money to cover essential services. It’s because the political will hasn’t existed to make the tough decisions that would bring our city’s budgetary spending into line.

Over the past ten years, the cost of city government has increased 58% from $4.2 billion to $6.6 billion. The cause, according to the controller, is that “citywide costs have continued to climb, in large part due to escalating salary and benefit costs related to labor agreement provisions, new mandates and capital funding.” Put another way, the city is paying for salaries, pension plans and mandated spending levels that it simply can’t afford.

Like the state legislature in Sacramento, San Francisco has tried to triage each year’s budget deficit, delaying important capital projects, bargaining for short-term salary concessions while hoping that the economy improves.  But these temporary fixes ultimately make the problem worse by passing the buck to the next year. 

But the good news is that this dire situation can be reversed if immediate changes are made.

The city’s pension system must be re-designed to ensure that it is able to meet the needs of retirees without bankrupting the city. According to findings reported by the civil grand jury, the City’s cost to its retiree pension system will grow 310% from $175 million in 2005 to $544 million by 2012. With over 40% of active employees who are eligible for retirement, this will create a huge cash flow problem and add to future years’ deficits. Without sufficient funding to pay the city’s pension liability, the system will eventually go broke.

Abuses to the system, such as “pension spiking,” where employees are allowed to artificially increase their pension before retiring, must be stopped. The grand jury estimated that this practice has cost the city $132 million, citing an example of one employee who was allowed to raise his annual pension by $25,500 after being promoted to a higher paid position in his last year of service.

It is also time to evaluate mandatory spending set-asides that require the city to spend certain amounts regardless of the city’s financial standing.  Currently, 60 percent of San Francisco’s general fund budget is spent through mandated spending formulas.  However, in an economic recession, all mandates, except those established to protect extremely vulnerable populations, should be suspended or reduced. 

Pay raises should be limited during deficit years. Just two years ago, city officials voted to give a 25% increase to police officers over four years at a cost of $64 million and a 19% increase for registered nurses over three years at a cost of $39 million. In order to pay these increases, between 300 to 400 employees, including police officers and nurses, would have to be laid off.

But even if these changes are made, the budget process itself needs to be reformed in order to ensure better long-term planning.

Currently, the city’s budget process requires that the mayor submit an annual budget by June of each year.  The board of supervisors then reviews the budget and has sixty days to study, gather information, hold constituent meetings and make revisions.

As a department head, I have witnessed the inefficiency of the current process.  Although each department is required to submit a proposed budget, the mayor’s office, has, in recent years, simply imposed across the board cuts on city departments in order to address budget deficits.   This approach does not allow for strategic long-term planning and fails to protect the fiscal health of core government operations.

When cuts are imposed, decisions to restore programs fall to the board of supervisors. Their decisions are made under extreme time pressures, with department heads and constituents flooding their offices to advocate for funding.  The board then tries to find additional cuts so it can meet the demands of each supervisor’s constituencies.

The budget process needs a neutral, professional budget officer who is accountable for guarding the long-term fiscal health of San Francisco government. This practice, followed in a majority of similar-sized counties, would require the mayor, the board of supervisors and department heads work collaboratively to identify core priorities and create a budget to adequately fund them, while providing taxpayers with an objective evaluation of the performance of the city’s departments and programs. 

Having an independent budget office would also provide oversight by discouraging elected officials from making short-term political decisions that may not be in the best interest of the city. Because the budget officer would be appointed, not elected, he or she would not be as constrained by political influences.

The independent budget office could also provide performance-based evaluations of city contractors. Contractors who failed to achieve their promised outcomes would be required to explain their shortcomings, and the mayor and the board would have the benefit of an objective evaluation before deciding whether to eliminate, continue or increase funding for a given program.  Programs would be evaluated based on usage by city residents, and the quality of the service provided.  Duplicative or ineffective services would be weeded out, while successful programs would be encouraged and replicated.  “Best practices” could be employed to help programs that are worth saving but need corrective action to improve their performance.

Of course, these fundamental changes, like the efforts to redesign our nation’s health system, won’t come easy. Changing the budget process would require an amendment to the City Charter and combining the city’s various budget agencies into a single, independent budget office. But the failure to act will mean more mass lay-offs, a severe decrease in city services and a bankrupt pension system. Only by enacting real, structural reforms to our fiscal process will we get San Francisco’s city government back on the road to a sound and sustainable economic recovery.

Jeff Adachi is the elected Public Defender of San Francisco.

December 2009

PROP A:

Local Budget Measure Falls Short Of True Reform

 

While Proposition A, titled “Budget Reform,” takes a few steps toward changing the current process by which our city’s annual budget is decided, it falls far short of the reforms necessary to address our city’s long-term fiscal health.

Prop. A would establish a rolling two-year budget process to replace the current one-year cycle. It would also require a five-year financial plan and a certification by the city controller that San Francisco has enough money to pay its contracts. Additionally, it provides that all labor agreements be approved before the beginning of the fiscal year.

While Prop. A affords more time for reasoned decision making, it fails to address the fundamental structural problems that threaten San Francisco’s fiscal viability — skyrocketing pension costs, inflexible spending requirements and salary negotiations made without regard to The City’s ability to pay for them.

Prop. A fails to rein in The City’s pension liability. In July, the civil grand jury determined that San Francisco’s pension costs will increase by nearly 300 percent — from $178 million a year to $520 million — during the next three years. The increase is compounded, according to the report, by the fact that 40 percent of city employees are now eligible for retirement and another 15 percent will become eligible in the next five years.

The measure does not permit a reassessment of voter-mandated expenditures, known as set-asides. Currently, 60 percent of San Francisco’s $6.6 billion budget is spent through automatic spending formulas. While many of the services provided by these set-asides made sense in good economic times, in a recession it ties the hands of elected officials.

Prop. A also doesn’t control salary increases. Salary negotiations are made exclusively by the Mayor’s Office and approved by the Board of Supervisors, often without any input from department heads. It’s a common practice for raises to be handed out with no additional funding given to departments to pay for them.

This has resulted in departments having to lay off staff in order to pay raises it has no control over. For example, this year my department faces an $800,000 salary deficit because insufficient funding was provided to pay my current staff.

Unless these and other fundamental problems are addressed, The City will face even greater budget deficits, layoffs and a retirement system that will eventually go bankrupt.

So what’s the answer to improving the budget process itself?

The budget process needs an objective referee. The Municipal Executive Association, which is comprised of more than 1,000 city leaders and managers, has called for the creation of a professional budget office that would be accountable to the mayor and supervisors to develop the annual budget, facilitate negotiations with the mayor, Board of Supervisors, department heads and city contractors earlier in the fiscal calendar, and provide independent analysis.

According to a report issued by the association, “Nowhere in the process is the budget prepared or analyzed by a neutral professional manager who, while not the ultimate decision maker, is accountable for protecting the long-term fiscal health of San Francisco government and its core programs, and has the independence to stand up to political pressure.”

The study examined the budget processes of 16 similar local governments across the United States. Only King County, in Washington state, and San Francisco directly invested one elected official with the responsibility to develop a budget. In other jurisdictions — such as Chicago, Honolulu and even Los Angeles — the agency that develops the budget is accountable to both the executive and legislative bodies, and the independent budget officer is not an elected professional.

San Francisco would benefit from an independent budget office because it would require the mayor, the Board of Supervisors and department heads to work together in preparing the budget, while providing taxpayers with an objective evaluation of The City’s budget process and programs. It would also help to reconcile genuine political differences that exist, while lessening the influence of short-term political decisions.

Of course, these fundamental changes, like the efforts to redesign our nation’s health care system, won’t come easy. Transforming this process will require not only amending the City Charter, but also reorganizing The City’s various budget agencies into a single, independent budget office.

We are fooling voters and taxpayers by labeling Prop. A “budget reform.” Only real, structural reforms to our fiscal process will get city government back on the road to a sound and sustainable economic recovery.

Jeff Adachi is the public defender of San Francisco. To see a copy of the Municipal Executive Association’s report, visit www.sfmea.com.

November 2009

Mayor’s Cuts Are Taxpayers’ Disaster

The 25 percent budget cut proposed by Mayor Gavin Newsom would make it impossible for the San Francisco Public Defender’s Office to carry out its mission of providing legal representation to the 24,000 people the office is assigned to represent each year.

Budget cuts would result in the lay-off of attorneys and staff that would force the office to withdraw from representing as many as 6,000 cases. The Public Defender’s Office and appointed attorneys represent 90 percent of San Franciscans accused of crimes. If the Public Defender’s Office cannot handle cases due to insufficient staff, the cases must be referred to private attorneys at a greater cost to the city.

On May 6, 2009, over 400 attorneys, criminal justice policy experts, students, activists, community leaders and concerned citizens attended the 2009 Justice Summit: Defending the Public and the Constitution held at the San Francisco main library, to show their support for public defense.

The 2009 Justice Summit, co-sponsored by the California Public Defenders Association, California Attorneys for Criminal Justice, Bar Association of San Francisco, and San Francisco Public Defender’s Office, was organized to bring awareness to the national crisis in public defense.

The Sixth Amendment to the U.S. Constitution requires that an accused person who is charged with a crime and cannot afford to hire a lawyer must be appointed an attorney by the government. Because of budget cuts and staffing shortages, many public defense offices across the nation are unable to provide adequate representation to their clients.

The 2009 Justice Summit, began with a dramatic announcement by Federal District Court Judge Thelton Henderson – who was scheduled to deliver the keynote address – that he had received a call from the judicial ethics council in Washington, D.C., advising him not to speak. “They were concerned that this event would be seen as too political,” Judge Henderson said. “So instead, I want you to imagine what I would have said if I were allowed to speak.”

The 2009 Justice Summit featured a morning panel discussion on the history of indigent defense in America, the role of public defenders in exposing government misconduct, and ensuring equal access to a fair trial.

According to panelist Kimberly Thomas Rapp, Director of Law and Policy at the Equal Justice Society, minorities, immigrants, working poor people, and disadvantaged youth and families are most likely to rely on public defense services. She also said that in difficult economic times, more members of the public rely on public defense, because fewer people can afford to hire an attorney and crimes rooted in economic hardship tend to increase.

In San Francisco, approximately 10 to 15 percent of the people served by the Public Defender’s Office are immigrants. According to a recent report by the National Council on Crime and Delinquency, African Americans are 4.7 times, and Latinos are 2.1 times as likely to have a public defender as their Caucasian counterparts.

In California, for every $8 spent on prisons and corrections, only $1 is spent on indigent defense. California Department of Justice statistics indicate that San Francisco has the lowest per capita spending on public defense when compared to other major California cities. In San Francisco, 59 percent of all public safety spending goes to fund the Police and Sheriff’s departments, while only 3 percent goes to fund the Public Defender’s Office.

According to State Public Defender Michael Hersek, budget cuts that reduce the staffing of public defender offices cause delays in court cases, which drive up incarceration costs. Staffing shortages also result in high caseloads, inadequate investigation and preparation of cases, and an increased likelihood that innocent people are wrongfully convicted.

Cookie Ridolfi, director the Northern Californian Innocence Project, explained that 20 percent of wrongful convictions proven through DNA testing resulted from poor lawyering due to insufficient investigation and defense resources. “The state must expend great sums to reverse a wrongful conviction based on incompetent lawyering. It is much cheaper to provide an adequate defense in the first instance to avoid the cost of appeals and retrials” she said.

Los Angeles Public Defender Michael Judge recounted a recent case in Mendocino County, where a minor was wrongfully convicted of a serious sex offense when his defender, due to having too many clients and insufficient resources, failed to properly investigate the background of a key prosecution witness. The Court of Appeal ruled that the public defender was responsible for the faulty representation of the minor and that public defenders may face disbarment for failing to adequately represent clients.

“We fully recognized the financial difficulty faced by the city of San Francisco, but our analysis concludes…that these cuts will cost the city and society far more in the long run,” said Russ Roeca, President of the Bar Association of SF, which represents 9,000 Bay Area attorneys.

The 2009 Justice Summit’s afternoon panel addressed public defense client services that extend beyond the courtroom to address non-criminal social issues, such as drug rehabilitation, mental health treatment and housing. One such example is the Public Defender’s Office Clean Slate Program, which has helped over 15,000 people clear their criminal records upon demonstrating rehabilitation, helping them overcome barriers to employment and housing.

A recent study of the Public Defender’s Office social service programs showed that providing alternatives to incarceration contributed to a $1 million annual savings for San Francisco.

“Public defenders worry about the community. They worry about making it better for their client,” President of California Public Defenders Association Bart Sheela said. “Trying to help people when they get out of prison not go back, doesn’t just help [the client], it helps the entire system.”

The 2009 Justice Summit attracted the support of a broad-based coalition of over 50 community, faith-based, and legal organizations. The movement to support indigent defense has been motivated by a surge of national interest in how the criminal justice system is being affected by budget cuts to defender offices, and lawsuits that have been filed in several states, including Florida, New York, Georgia, and Minnesota, over whether public defenders can be forced to accept cases when they are unable to handle the workloads assigned by the courts.

The 2009 Justice Summit will be broadcast this month on Cable SF Government Channels 26 and 78. For air times, to view on-line streaming video of the 2009 Justice Summit or to find out how you can help, please visit www.sfpublicdefender.org.

June 2009

Jeff Adachi: Defending People

I first became aware of the role that defense lawyers play in the criminal justice system while reading the novel “To Kill a Mockingbird” as a teenager. The story’s protagonist, Atticus Finch, is an Alabama lawyer who undertakes the defense of a man accused of rape during the Great Depression. The evidence against the defendant seems overwhelming, and the entire town turns against Finch and his client. But Finch is undeterred.As he investigates the case, he comes to believe that his client is innocent, though his faith is challenged as the case proceeds to trial.

Finch, who was portrayed by actor Gregory Peck in the film version of the novel, believes it is his obligation to provide a poor person with the same representation provided to paying clients. Because the client’s family has no money and there are no public defenders, Finch accepts the case without a fee.

Although the Sixth Amendment of the U.S. Constitution provides that an accused has the right to counsel, it was not until 1963 that the U.S. Supreme Court ruled that the government must provide a defense attorney in criminal cases. Before this ruling, most places only appointed lawyers in death penalty cases. However, California has provided attorneys for poor people charged with crimes for almost one hundred years, which is longer than most states.

Atticus FinchThe concept of a public defender, who defends the constitutional rights of any member of the public in a criminal case, was originated by Clara Shortridge Foltz. Foltz was a single mother of four who lived in San Jose in the 1870’s. She chose to become a lawyer at a time when the California State Bar refused to admit women. Foltz apprenticed for an attorney, learned how to file a lawsuit, and sued the State Bar on the grounds that it illegally discriminated against women. She won and became California’s first female lawyer.

In 1893, Foltz, already a well-known criminal defense attorney, introduced the Foltz Public Defender bill, which was a blueprint for a system that would provide lawyers to poor people charged with serious crimes. She spent over 20 years lobbying for the passage of the bill, which California ultimately passed in 1921. The San Francisco Public Defender’s Office was established that same year.

Interestingly, San Francisco is the only county in California that elects its chief public defender. Although district attorneys throughout the state are always elected, all other public defenders are appointed.

Nationwide, only a few states have elected public defenders, including Alaska and Florida.

Today the public defender system has emerged as the most cost-efficient and effective way to provide legal representation. Most defender offices handle large volumes of cases and hire attorneys who are specially trained to try criminal cases. Defender offices usually have in-house investigators and support staff who assist the attorneys with case preparation.

There are three basic stages to a criminal case once the court assigns a case to a public defender. First, the client must be interviewed and the circumstances of the case must be thoroughly and independently investigated. Often there are witnesses who the police have failed to interview or other evidence that should be considered. Next, the defense attorney must prepare and file any needed legal motions. Third, settlement negotiations are explored, and if the case does not settle, the accused may request a jury trial.

Some cases are simple and require little time. Other cases may involve thousands of pages of documents to examine and dozens of witnesses to interview. A jury trial requires a great deal of preparation and can involve weeks or even months of an attorney’s time and attention.

Public defender offices are traditionally underfunded and poorly staffed compared to district attorney offices. It is estimated that some defender offices receive about 50 percent of the funding provided to prosecutors. This means that many offices must handle large caseloads with insufficient staff.

This was true of the San Francisco Public Defender’s Office until recently. When I started as a deputy public defender in 1986, attorneys were expected to handle about 300 cases at a time. Attorneys typically worked 12-15 hour days, and still it was virtually impossible to keep up with their caseloads.

One of the things I set out to do when I was elected public defender was to set reasonable caseloads for the attorneys and provide support staff to assist them with their work.

Today, our office of 93 attorneys and 70 support staff represents about 24,000 people each year. Although attorneys in my office still typically work 50-60 hours each week, they have the necessary time to interview their clients and do the work that is required in each case. The office’s policy and procedure manual sets forth the quality of legal representation expected in every case, and managers constantly monitor workloads to ensure that each client is properly represented.

With the advent of modern technology and advanced police investigation techniques, the responsibilities of deputy public defenders have grown. For example, since the expansion of the use of DNA evidence, attorneys must now become DNA experts and thoroughly familiarize themselves with the scientific studies in this field. Because of our limited resources, the office is a model of efficiency. We pair attorneys with investigators and paralegals, who work as a team to coordinate all of the work required of an attorney’s caseload. Paralegals perform work that would otherwise have to be done by attorneys, resulting in about a one-third cost savings. We also employ over 200 volunteer law students and interns, who provide over 20,000 hours of free service annually in exchange for an opportunity to obtain work experience.

The Public Defender’s Office entire budget is less than what the San Francisco Police Department spends on overtime. This means we must make every penny count.

In recent years, we have begun to develop innovative approaches to crime prevention. Because we work with clients charged with crime, we are uniquely situated to help people break patterns that have resulted in their continued involvement in the criminal justice system. We have social workers who place clients in substance abuse, housing and employment programs. By helping individuals become productive citizens, our social workers decrease the likelihood that clients will be arrested for crimes in the future.

One example of a highly effective service provided by our office is the Clean Slate Program. A record of conviction can plague a person’s employment prospects for years after one has paid his or her debt to society. A person who can prove rehabilitation can petition the court to set aside the conviction in order to obtain employment. The Clean Slate Program provides assistance with this process to over 2,000 people each year.

I am very proud of the work that the men and women of the Public Defender’s Office achieve through their dedication and commitment to providing representation to the poor. We are the only city department to have twice won the Mayor’s Fiscal Advisory Committee’s Managerial Excellence award, under Mayors Willie Brown and Gavin Newsom. In 2006, we received the American Bar Association’s top award for being the best public law firm in the country.

The Public Defender’s Office has come a long way in implementing the Constitution’s guarantee that a poor person receives the same quality of legal representation as a rich person. By always looking for ways to improve our office and by holding our staff to the highest standards of excellence, like Atticus Finch, we try our best to fulfill this great nation’s promise of equal treatment under the law for everyone.

Jeff Adachi is the Public Defender of San Francisco. For more information visit sfpublicdefender.org.

March 2009