*This story was altered on Sept. 2, and Sept. 6, 2011.
A light breeze blows across the dark skies outside the Costa Mesa council chambers. Inside, a storm is brewing. After hours and days and weeks and months of speculation and discussion, the time for talk is over. Decisions are being made about the future of the city, and there is concern that the worst is yet to come.
The chambers are packed: all the seats are filled, with an overflow crowd outside the double-door entry, viewing the proceedings on a 32-inch television. In a row toward the rear of the chambers, four men wearing bright-orange shirts sit side-by-side, arms crossed, gazes fixed on the five-person council sitting behind the dais at the front of the room, beneath the Costa Mesa crest and the motto “In God We Trust.” It's March 1, and on this night, the Lord can't help anyone.
The national media isn't here because no one has yet leapt from City Hall, the mayor hasn't appeared on news stations dressed as a leprechaun, the city hasn't yet hired a former award-winning reporter as its high-priced spokesman, and a police chief hasn't resigned behind a letter filled with scathing accusations.
“I hope I'm premature in expressing my sadness over what appears to be the coming demise of the city of Costa Mesa as we've come to know and love it,” Perry Valantine says, one of more than 30 people who will blast the council tonight. Valantine retired more than six years ago after years of serving in the Development Services Department. “It just seems that this council, as laudable as your goals may be to correct the budget deficits and other financial problems in this city, is moving way too fast. . . . In the 20 elections that I've seen over 40 years, there have been a lot of changes in this city, but none nearly as drastic and nearly as fast as what this council is trying to do in the not-quite three months since it's been sitting behind the dais.”
The city is at a crossroads. Four of the five council members maintain Costa Mesa is facing a financial crisis so severe it's on the brink of insolvency. In order to close the remaining $1.4 million budget shortfall, the council wants to outsource 18 municipal divisions, which account for 213 jobs—more than 40 percent of the city's workforce.
This isn't a new position—indeed, the City Council faced a financial problem last year, one of thousands of municipalities nationwide struggling during this recession. Representatives from the Costa Mesa City Employees Association, a charter member of the Orange County Employees Association (OCEA), presented more than 100 suggestions in hopes of assisting in the matter, but the union received a “blanket no,” according to Billy Folsom, a city mechanic who was involved in those proceedings. The union asked the council what it needed and received a list of suggestions. The employees agreed to every request, which included furlough days, a reduced retirement formula and increased contributions to their pensions.
“We will always work with the city; we always have,” Folsom says to the council. “We've always come to solutions together; we've never done things backwards—until this point. We just had a study completed 10 days ago on graffiti removal that shows we do it much cheaper than anyplace around, but they're on that list. We've had four studies in just the past couple of years on the street sweepers—one just completed, came back we did it cheaper; they're on the list. So it makes some of us feel like maybe it isn't a dollars-and cents-thing, that maybe it's a little bit of ideology creeping in here. And as a city family, yes, we're a little depressed, we're a little taken aback, and we do get tired of seeing ourselves demonized as union hacks or some kind of fat cat. It's not true.”
Mayor Pro Tem Jim Righeimer listens intently to each comment, showing little reaction, other than an occasional head twitch. When it's his turn to speak, he takes a second to adjust his red-and-silver-striped tie, then presents his thoughts in a composed manner.
“There's a clock, and there's a calendar, and we will run out of money in this city—you can count on it,” says Righeimer, maintaining his matter-of-fact approach. “If we're going the way we're going, we're going to run out.”
Wendy Leece, the lone female at the dais, doesn't agree. The second-term council member lends her support to the employees and situates herself as the union's champion.
“[Previous councils] have not made bad decisions—we kept the ship going, and we're still weathering the storm—but we don't need to take drastic means and issue layoff notices to affect the morale of our employees,” she tells the audience, which has thinned significantly now that the meeting is five and a half hours old. “I am tired of the demonization of our employees. . . . I don't know why more meetings are not held with staff to find solutions rather than to go to this. It's like the decision has already been made. So I will not support this.”
Her speech falls on deaf ears as the council votes, 4-1, in favor of issuing the six-month layoff notices. Before the secretary finishes recording the vote, the chambers start clearing out. A rumble of subdued chatter flows out the doors.
This is just the beginning. As one of the union staff members mentioned during public comments, the union “will present a united, determined and most formidable foe.” The propaganda and the rhetoric are soon to arrive, attitudes will sour, and the city of Costa Mesa will be divided. Darker days are coming.
* * *
For years, Costa Mesa had a kind of Mayberry feel. It's home to South Coast Plaza, a performing-arts center, the fairgrounds, and burgeoning music and dining scenes. It isn't high-society like Newport Beach, but it's also not Stepford suburbia like Aliso Viejo.
And while Orange County is a notorious conservative breeding ground, the city has managed to present itself as a sort of amalgamation of conservative and liberal thinking and ideals. While the City Council has occasionally been used as a springboard to Sacramento (see former mayor Allan Mansoor, who demonized Mexican immigrants all the way to an Assembly seat), mostly, it's small-business owners and residents who have stepped up to the challenge of governing the city.
But that Mayberry feel is now gone. Ever since the City Council moved to deliver the six-month notices—a contractual obligation with the union when issuing layoffs—it has been clear that nobody trusts anyone.
The Orange County Employees Association and residents who oppose the council's decision call the budgetary concerns speculation or a straight-out lie. They point out that the council's indication of drastically increasing California Public Employees' Retirement System (CalPERS) figures are projections, that nothing is certain in this economy. They don't buy the council's explanation that the matter is based on simple math, instead believing it's part of a widespread political agenda that's intended to weaken or destroy labor unions, with Costa Mesa the Petri dish for a grand conservative experiment—a micro-Wisconsin.
“They're a long way from crisis, but they're opportunistic,” says OCEA general manager Nick Berardino, who has been involved in labor negotiations for more than four decades. “They're using a bad economy at a time when they should be working, collaborating with people to work on solutions. Instead, they're using that to advance their political agenda.”
As a whole, the City Council—four of whom are businessmen—remains steadfast in its position that the city no longer has the money to pay employee-compensation packages, which account for almost 80 percent of the city's budget. Pension costs have risen from $5 million to $15 million in the span of 10 years, and the council projects those numbers will increase to as high as $25 million in the coming years. (CalPERS itself also projected those costs reaching as high as $25 million annually.) Outsourcing, the council maintains, isn't something it necessarily wants to do, but if it saves the city money, it will be something it has to do. The budget shortfall in the 2010-2011 year was $1.4 million, which it managed to meet. In the 2011-2012, the council once claimed the shortfall might have been as great as $5 million; numerous cuts brought that budget into balance.
“People want to believe, 'Oh, things are going to get better'—they clearly aren't,” says Righeimer, a real-estate developer who's in his first term on the council (he ran unsuccessfully in 2008). “Even if things were going to be okay, you've got to budget as if they're not. You have to budget on what you know, not what you hope.”
Steve Mensinger was appointed to his seat in January, after Katrina Foley stepped down upon learning she couldn't hold the position after being elected to the Newport-Mesa Unified School District's board of trustees. His slot gives the council a commanding majority, and Mensinger has fallen in lockstep with the positions of Righeimer, his former co-worker at developer SunCal Companies.
“Across the state—San Jose, Modesto, Oakdale, Stockton, Sacramento, Visalia—every city has these same [financial] issues; we're just dealing with it differently,” he says. “It's not like we have ideological field trainings.”
But Mensinger is fibbing. The Orange County Republican Party has long tried to scapegoat public-employee unions, using Righeimer as its supreme attack dog. In 1993, Righeimer—a longtime conservative activist, close friend of OC GOP head Scott Baugh and protégé of Congressman Dana Rohrabacher—helped to write Proposition 174, a failed school-voucher law that threatened the California Teachers Association. Five years later, he was involved in creating Proposition 226, which, had it been successful, would have outlawed the lifeblood of union power: automatic deductions from members' paychecks for dues. During the 2010 election, Righeimer campaigned hard on pension reform, targeting the police force, among other city employees. The police association answered back with a truck dragging a trailer that featured Righeimer's face crossed out, like a nerd taking revenge on his bully in a junior-high yearbook.
And earlier this year, Baugh helped to organize a pension-benefits and employee-relations boot camp for city councils at which speakers slammed public-employee unions as the culprit. Among the attendees? Righeimer.
“[The lack of trust] makes it very difficult to move forward,” Berardino says. “When people don't trust their leadership and don't have confidence and faith that they're getting the truth from their leadership, it makes it very difficult to reach a consensus.”
But even if a resolution between the council and the union is reached—however unlikely that may be—selling it to the public, after allegiances have been made, won't be easy. Right now, the two sides remain miles apart from anything remotely resembling a settlement. Negotiations stopped months ago; instead, partisan firebombs have taken the place of conference calls.
In May, OCEA launched a “Waste Watchers” campaign, with lawn signs promoting its website (repaircostamesa.com) blossoming in front yards and along roadways throughout the city. In the first email sent by Jennifer Muir, the group's spokeswoman and a former Orange County Register reporter, she explained that the campaign was “our way of offering the City Council . . . even more ways to save.” In the weeks that followed, emails identified what the association deemed unnecessary city spending, including $425 jewel-encrusted nameplates, $7.8 million on “cosmetic repairs” to City Hall (that number was from a “wish list” of items that won't be included in the budget until enough funds are available), and $5,300 on “dinners, lunches and breakfasts for city bureaucrats.”
For every Waste Watchers email produced by the union, Costa Mesa responded within hours, offering point-by-point refutations penned by city CEO (formerly city manager) Tom Hatch or William Lobdell, a former editor of the Daily Pilot and award-winning religion reporter for the Los Angeles Times who now has a $3,000-per-week job as Costa Mesa's interim communications director.
Foley still frequents council meetings and has stepped up to the microphone on occasion. She says she's disappointed by what has transpired since she left the council in December 2010. Had she been able to foresee “this aggressive assault on employees,” she says, she “would have taken the bullet and faced the lawsuit to fill [the council and school board seats].” Now she can only watch while people make insinuations and assumptions about their leaders and neighbors.
“That's one of the terrible consequences of all this: that huge loss of trust by all sides,” she says. “No one trusts anymore; even friends don't trust anymore.”
* * *
On March 17, 16 days after the council's vote, the layoff notices were issued. Most of the 213 pink slips were delivered in person by the employee's supervisor.
The majority of the city's maintenance workers were given the news as a group by Peter Naghavi, director of the public services department. Huy Pham, a 29-year-old who'd been working for the city for nearly five years, had been home nursing a broken foot that day when he received a call from his supervisor, saying he needed to come to City Hall to pick up his notice.
Aside from spending free time training for a trip to climb Mount Everest, Pham had spent his hours after work on side jobs to help his family and night classes. Though he had a mostly sterling work record, a supervisor had recently found him asleep on the job, exhausted.
“I didn't realize [Pham's job] was taking such a toll,” says his younger brother, John, months after that afternoon. “He never voiced it. He usually kept things to himself.”
Pham arrived at City Hall, made his way to the roof without interacting with anyone and leapt off the building's east side shortly before 3:30 p.m., according to police reports.
Berardino was in Santa Ana when he heard about the incident; he rushed to the scene, where employees and city residents and members of the media were already gathering. After grieving with employees, Berardino caught sight of Righeimer and Mensinger but realized that Mayor Gary Monahan—the longest-tenured member of the council, having served on and off since 1994—was nowhere to be seen. It was St. Patrick's Day, so Berardino decided to make the short drive to the mayor's bar, Skosh Monahan's. There the mayor was, standing outside in a kilt, beads, a green bow tie and a green headscarf. Berardino took a photo with the camera on his cell phone before identifying himself.
“His demeanor changed pretty quick once he found out who I was,” Berardino recalls. The exchange that followed was brief but emotional, Berardino says. Monahan reportedly told him, “I'm a businessman; I hire and fire people every day.” Monahan has neither confirmed nor denied the statement.
Monahan's fellow council members have called Berardino opportunistic, claiming he raced to the restaurant moments after the incident, before Monahan may have heard, and then shared the image with the media. But the image data for the photo, which is still on Berardino's phone, shows it was taken at 5:18 p.m., more than an hour and a half after Pham's death.
By nightfall, the compromising images of Monahan appeared on news broadcasts and websites across the county. Righeimer says he spoke with Monahan shortly after the pictures were taken and warned the mayor to not come to City Hall. Police had escorted Righeimer and Mensinger into the building after they were approached and threatened by one employee and taunted by another.
For hours after Pham's death, people came to City Hall to console one another, shed tears together and try to rectify it all. A candlelight vigil was held. While news of the layoff notices garnered media attention throughout Southern California, Pham's death and the mayor's behavior gave the story national intrigue. The New York Times sent a reporter, as did the San Francisco Chronicle, Bloomberg and other major media outlets. Interviews with Righeimer aired on FOX News. Even The New Yorker sent its “Letters From California” correspondent, Tad Friend, to cover the story, which printed just days ago.
Geoff West, a 70-year-old former human-resources consultant, has covered the story longer and with more depth than anyone on his blog, A Bubbling Cauldron. He has attended every council meeting and study session for months, typically sitting in the back of the room, equipped with a small notebook and a point-and-shoot digital camera. West, who doesn't have any background in reporting or writing or politics, started A Bubbling Cauldron in 2006 as a platform for his thoughts on various matters in city politics in Costa Mesa and Newport Beach. Now, his website gets hundreds of hits per day and functions as a forum for discussions, sometimes constructive and other times vindictive.
West was suspicious of what was happening in Costa Mesa before most newspaper reporters. He's been critical of Righeimer's escalation through the political ranks, pointing to his relationships with Baugh, Rohrabacher and Mansoor. “When Righeimer was appointed to the planning commission, I thought we might see things evolve into something serious,” he says.
And West hasn't held back in voicing his opinion of the mayor pro tem, referring to Righeimer as a “carpetbagger” for moving from Fountain Valley to Costa Mesa in a decade-long effort to get elected somewhere, anywhere. “Jim Righeimer has never been elected to public office before, although his cronies have appointed him to many high-ranking jobs,” wrote West, leading up to the 2010 election. “That's kind of how he gets along in life, I guess, depending on the patronage of political allies for positions of authority. Every time he has run for political office, he has failed. There are good reasons for that failure.”
* * *
At the City Council's April 5 meeting—the first following Pham's death—police officers stood guard at either end of the dais. Four more officers roamed near the entrance doors, scanning the crowd and putting an eye on anyone who entered the chambers.
When Monahan called for the meeting to commence, he was solemn, his usual ebullience gone. After early meeting proceedings, Monahan took a moment to offer an apology for “my shortcomings as mayor.” While some members of the public—including Sanitary District board member Jim Fitzpatrick, who has voiced his support of the council from the beginning—commended the mayor for his “sincere” words, others weren't so quick to forgive.
Susan Meyer, an 18-year resident of the city, gave a passionate speech ridiculing the council for its “callous” decision to deliver the outsourcing notices “without a proper study.” She locked eyes with Monahan and asked him to fire himself. “You are not fit to be our mayor,” she said.
A deeper divide was evident in the chambers: those who wholeheartedly supported the council's attempts to balance the budget and not give in to union demands, and those who were in support of the employees, some of whom blamed the council for Pham's death.
In the days that followed, the story accumulated steam, as one incident after the next escalated the tension among residents and enhanced the selling power of the story: commercials produced and funded by a union-supported group called Repair Costa Mesa attacked the council and called for the layoffs to be rescinded; a brick with a note attached was thrown through the window of Skosh Monahan's; at a community event, a confrontation occurred between Mensinger and an Estancia High School teacher, who is also a member of Repair Costa Mesa; and a union-funded audit uncovered what OCEA called “pots of money,” but it was hastily dismissed by the council, with its list of suggestions called a “road to bankruptcy” by Righeimer.
Then came Pham's autopsy results. The coroner's report showed he had in his system trace amounts of benzoylecgonine, which is both a compound in cocaine and muscle relaxers; an attack on his character followed. The city hired a former Secret Service agent to conduct a second investigation of the events on March 17. Soon after, Pham's personnel file was released to the press, and his past work problems became headline news. Muir told reporters the release of information was “just a sad attempt to diminish his memory,” while council supporters such as Will Swaim (former Weekly editor and godfather of one of Lobdell's sons), who pens scabrous rants on his personal blog, Republic of Costa Mesa, slammed OCEA for treating “Pham like the protagonist in Weekend at Bernie's.”
Interim Police Chief Steve Staveley—a 40-year-veteran who had served as police chief in six other cities—in turn delivered a scathing four-page letter to his police force on July 20. It announced his resignation, effective that same day at noon. He ridiculed the council and the way it was governing the city, calling council members “incompetent, unskilled and unethical,” especially given that the council wanted to shift the police work schedule from four 10-hour days per week to five eight-hour days. Staveley went on to second-guess the financial crisis and made claims of corruption, though he failed to support them with any facts.
The city, through Hatch, responded with a point-by-point dissection of the facts it felt the outgoing chief had wrong, referring to the letter as “reckless” and Staveley's behavior as “unprofessional.”
“[Staveley's resignation] is a terrible event, but one that does not surprise me at all,” West wrote on A Bubbling Cauldron. “Staveley said it many times throughout his memo. The residents and employees of this city deserve much better treatment than they are getting from this current bunch of amateurs on the City Council.”
* * *
In a town best-known internationally for the avaricious playground of South Coast Plaza, adults are bickering over funds for a children's program. It's a Tuesday night in early August, and the council chambers are half-empty—an oddity in recent months. Only a few dozen seats are filled, as the agenda had appeared to lack any truly divisive or consequential items.
The leaders of the city are bickering over funds for the type of program that's typically the fabric of a community. A simple recommendation to grant $10,000 to the local Pop Warner league for field fees results in two hours of heated debate, with union representatives and residents accusing council members of lies and misuse of funds and council members singling out and insulting audience members. The Costa Mesa City Council has become a civic dissolution.
“What I have been told since February is that the city doesn't have any money,” says Helen Nenadal, the president of the Costa Mesa City Employees Association and an employee of the municipality for more than 30 years. She's had children go through the football program, so she knows its value. But she's one of 213 employees who were issued a six-month layoff notice in March, forced to wait to hear whether or not she would still have a job while the city researched outsourcing opportunities. How, she wonders, are there now available funds for youth sports when she just had to say goodbye to another three employees days prior?
“The issue is not do we have money—we have $100 million to spend in this city, give or take. It's where do we spend our money?” Righeimer pronounces to the audience during council comments. “So are we poor, are we starving, is everything going to end? No. But with this new City Council here now, we're righting the ship.”
The niceties of five months ago are gone. Righeimer's cheeks are reddening as his glare and his words are directed at Nenadal, who's sitting alone in the rear right corner of the chambers.
“Ms. Nenadal, we have enough money to run our city,” he continues. “We just can't afford the costs of your employees. Your employees are over the top.”
* * *
“It's been six months, and we're all still here,” says Berardino. The six-month layoff notices will pass in middle of this month. The date will come and go, but no one will be out of a job.
After months of Leece repeating that the boys' network on the council was moving too quickly, even once calling the financial crisis a lie, it appears she had made a good point. No one had done his or her homework on the outsourcing process. It turned out the city had skipped steps—ones with legal implications—preventing the city from even being allowed to issue Requests for Proposals, posted documents meant to attract bids from potential vendors.
“[The mistake tell] us that there wasn't, obviously, a real interest or a thoughtful approach to doing this,” Berardino says. “They didn't want to investigate what needs to be done. They didn't care what the law said, they didn't care what the ordinances said, and they didn't care what the policies said. They had one goal in mind, and that was to advance their political agenda.”
The process will begin, once again, from the beginning, but this time, union representatives will be involved. The temporary injunction blocking the layoffs is still in effect, pending the city's appeal to the California Appellate Court. Righeimer and the council seemingly remain unfazed, confident in what's to come.
“In the end, whether the economy does well or doesn't do well, the city's going to be fine; there's more than enough money here to fix our problems—there really is. We're not a poor city,” says Righeimer, peering out the window of his Newport Beach office. “[The union's] only hope is if they can stop the process before the next election. The only hope they have is if they get the majority, and I can tell you that is not going to happen in any way, shape or form. Part of it is who these people are, but the whole country has figured it out—they get it now.”
This article appeared in print as “Costa Messy: Scenes from the civic dissolution of America's latest public-employee battleground.”