A sign for my times | Arkansas Blog

Thursday, September 3, 2009

A sign for my times

Posted By on Thu, Sep 3, 2009 at 6:46 PM

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Saw this on Avenida Revolucion in Tijuana today. And an utter dearth of U.S. visitors. Economy? Reports of violence? Don't know. The pharmacists were twiddling their thumbs. The business in legitimate pharmaceuticals is usually booming in TJ, judging by the number of outlets.

The taquerias featured 10-beer buckets for $15 US and three tacos for a dollar.

* A quick run through my e-mail pile indicates the LR police are unhappy about the city shorting the police pension fund in payments from district court probation fees. See a dispatch from retired officer Farris Hensley on the jump.

* Also: The LR Planning Commission today voted to rename the portion of Third Street east of Main as River Market Avenue.

* Also: Interior Secretary Ken Salazar indicates compromise is possible in the Park Service's trademark dispute over Hot Springs' use of the National Park identifier in its promotions. Not much of a compromise appears in the offing, however, if Salazar continues to insist that the city give up use of a logo it used for 22 years.

Have something sweet for dessert.

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EMAIL FROM FARRIS HENSLEY

September 3, 2009
 
By Farris Hensley
Board Secretary
 
CITY OF LITTLE ROCK SLACKS P0LICE PENSION FUND $460,531.06
 
During the August 13, 2009 Little Rock Police Pension Board meeting, City Treasurer and Pension Fund Board Trustee, Sara Lenehan presented the long awaited accounting report detailing the amount of Little Rock District Courts probation fees that were illegally withheld from our Pension Fund.  The grand total between the years of 1995 through 2005 that ultimately went into the City of Little Rock general fund, rather than to the Police Pension fund, was almost one-half million dollars ($460,531.06).  At the present time let’s not bother calculating interest on the money over the ten (10) year period.  However, always keep one thing in mind:  Arkansas State Statute (the law) mandated that ten percent (10%) of all probation fees collected from the three (3) Little Rock District Courts be paid to the Police Pension Fund.  Undisputedly, the law was repeatedly violated year after year by the City of Little Rock .
Now, after reviewing the report at the meeting, can you guess what my question was?  That’s right: When are you going to pay the money that you illegally withheld from us?  When it became clear to me that neither Mrs. Lenehan nor Bruce Moore, who as you know is the City Manager and Chairman of the Board, were not at all offering to pay the money, I did what I thought any good Trustee while exercising their fiduciary duties should do.  I got on my soap box, and explained that not only had the City never done the right thing by contributing on an annual basis enough to fully fund the Pension Find, but it had on other occasions throughout the years withheld statutorily required funding.  Hello, intentional or otherwise, is that not establishing a pattern and practice?
Anyway, lets now look at what your Board Members had to say about it.
Mrs. Lenehan, Treasurer of the Pension Fund exercised her fiduciary duties to the Fund by telling the Board that the City of Little Rock had already paid the Police Pension Fund what was owed them by paying $63,066.00 in April 2009.  Let me explain, that amount represented the past three years of probation fees that coincidently was not included in the one half million dollar amount, but was within the three (3) year statute of limitation period.   In an effort to justify what I would charterize as a "I got ya" response, she said that the City was unaware of the requirement to pay a percentage of probation fees until they reviewed the Arkansas Attorney General opinion, at which time upon advice from the City of Little Rock Legal Counsel, they paid the above referenced three year amount, that was within the statute of limitation period, and that the remaining previously referenced amount of $460,531.06 has no bearing because it is outside the statute of limitations.  Well now, I have to admit that her comments were at least just a little concerning.
On the other hand Mr. Moore took a much different approach.  He explained that the City’s failure to contribute a portion of probation fees was unintentional, and once the City became aware of the requirement to pay the Pension Fund, they immediately began making required payments, and paid the previously referenced three (3) year statute of limitation amount.  He said that if the City was in a much better financial situation "from a local sales tax perspective", he believed that he would be very supportive of attempting to fully fund the Police Pension Fund, however said that he recently had to reduce the City’s budget by approximately $2,000,000.00.  Interestingly, that $2,000,000.00 budget reduction was from a $200,000,000.00 total annual budget.  He went on to explain that the money was just “not there” to pay the one half million.  When pressed by Mr. Harrod concerning the emergency city reserve fund, he (Mr. Moore) said that approximately $9,000,000.00, that is right nine (9) million with an "M", is currently held in the fund for events of a catastrophic nature.  As you can imagine, Mr. Harrod was quick to explain that Pension Fund Members might very well consider this situation an emergency.  At this point I simply must offer an editorial comment.  "It just might be interesting to review what has been considered past emergencies when spending the reserve fund money".  Finally, the position that was taken by Mr. Moore was that the amount of money in question significantly exceeds his $50,000.00 authorized limit as City Manager, therefore must be approved by the Little Rock City Board.  He further explained that the Pension Board had previously been discussing a future presentation before the City Board in regard to the overall funding issue, and that he thought it would be appropriate to also address this particular matter. 
David Rowan and Brad Furlow who as you know, are also Trustees of the Fund asked questions regarding a portion of any future sales tax increases being dedicated for Police Pension Fund purposes.  Mr. Moore was very quick to explained that he normally is not supportive of such dedications because it takes away for the overall revenue stream.  Although, he did say that if a one half (1/2) cent sales tax increase were approved, he would be in favor of recommending that the Fund be made “whole” over a period of time.  Once again, another editorial comment.  Other that the fact that such a statement seems to be a fishing line with a hook dangling on the end, nothing was offered other than he would be in "favor" of a "recommendation".  In other words, once again over a long period of years, we (the City) have violated the law by withholding public funding from you, have now spent your money, and don't have it to pay.  Although, we (the City) will not dedicate any portion of a future sales tax increase to the Fund, you can trust me (the City Manager) because I will make a "recommendation to make the Fund whole over a period of time".
Comments by both Mr. Rowan and Mr. Furlow were limited to various sources of public funding allocated for Pension Fund purposes, and the potential of a future sales tax increase or City Bond issue.  Mr. Furlow did inquire concerning the feasibility of a possible future consolidation with the state retirement system, (LOPFI).
 In addition to Mr. Harrod's comments regarding the City of Little Rock’s emergency reserve fund, he also referenced a previous vote that was cast by Mr. Moore to repay Police Pension Fund money, not City of Little Rock money, to members of the Fund because City employees had made errors that resulted in various members of the Fund being underpaid.  He (Mr. Harrod) reminded (Mr. Moore) that it too was outside the legal statute of limitation period.  Sounds like a pretty good point to me.
Now you have it, but the big question is what direction the Pension Board will take in an effort to recover this critical funding.  And, more importantly how passionate will their collective actions and efforts be.  Although the Board was clearly in favor of addressing the matter before the Little Rock City Board of Directors, I would like to have seen a little more passion, and quiet frankly a hint of outrage, from some of the Board Members, especially given the seriousness and magnitude of the issue.  Clearly and undisputedly the City illegally withheld the funding over a ten (10) year period, and given their ethical and moral obligations to the Fund, should never be allowed to say ‘sorry legal technicality’, ‘the ole statute of limitation’, or ‘sorry we spent your money and no longer have it to pay you’.  It should always be remembered that the City Manager and City Finance Director who sit on the Police Pension Board have tremendous responsibilities before them, however exercising their fiduciary duties while sitting on the Pension Board should always be first and foremost.
Like I said previously, this matter will apparently be included within the broader funding issue going before the Little Rock City Board of Directors.  Although it is not considered a legal issue, it certainly is one of ethical and moral responsibilities.  We need to keep in mind that certainly for the most part our current City Manager, City Treasurer, Mayor, and Board of Directors had very little if anything to do with what has occurred, however we must insist that they work with us to correct the problem.  We must also remember that our elected representatives of the City Board actually have very limited knowledge of Police Pension issues, but should expect them be responsive, receptive to learning, honest, and sincere in working to solve such serious problems.  They must understand that one half million dollars to a Pension Fund who has a number of members receiving as little as $1,000.00 monthly expect much more that a comment of "we have paid what we owe you".   
Last question of the day is for you, Members of the Fund.  What do you think?  As always, your questions and comments are welcomed.  You can direct them to me, and if requested I will forward them to your five (5) elected Board Members.  If you would prefer that other members also receive your comments, then simply select (reply all) that is located beside the (reply) tab, and it will reply to everyone listed on the original email.  Remember, this is your Pension Fund, and what you do will ultimately determine the future.  Step up, or sit on the sideline.  Our rewards are often proportionate to our efforts.

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