SEIU Local 1000 sent misleading texts about CalPERS election

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Many SEIU Local 1000 members recently received misleading texts from their union regarding the CalPERS board election.

The texts, presented as survey questions, included an inaccuracy related to a board vote and presented information about other votes cast by board members Margaret Brown and David Miller without context. Brown and Miller are both running for re-election, with mail-in ballots and votes by phone or online until September 27.

Brown, a retired school administrator, faces new challenger Jose Luis Pacheco, a community college IT administrator. Miller confronts newcomer Tiffany Emon-Moran, a retired police officer.

The texts, written to present Brown in a favorable light, followed a campaign mailing that Local 1000 sent to many union members expressing support for Brown and Emon-Moran.

CalPERS ’13-member board oversees a state pension fund recently valued at around $ 489 billion. It makes significant decisions about retirement and health benefits for approximately 2 million public sector employees and retirees.

Local 1000’s support for Brown and Emon-Moran puts the organization – which represents approximately 100,000 state employees – at odds with other branches of SEIU and most unions in California. A worker-funded spending committee that has backed Miller and Pacheco has raised around half a million dollars and paid for several mailings and advertisements since the vote began on August 27.

Local 1000 is following its own path mainly under the leadership of newly elected union president Richard Louis Brown, who told union members in an online meeting taped two weeks ago that he decided to spend nearly $ 30,000 in flyers to support Brown and Emon-Moran after reading about the candidates on the Internet.

Brown said the texts, sent about a week after the leaflets, were intended to “inform people of the election of CalPERS.”

“We were setting out the facts of Margaret Brown and David Miller’s voting records,” he said. “Was it really an endorsement?” No. Did I vote for Margaret and say so on camera? Yes.”

Mech Block-Sherles, a shop steward for Local 1000, said she did not find the texts helpful.

“They didn’t give us all the information we needed; they just gave us very biased information, ”she said.

The first text stated that Miller had voted to increase health insurance premiums by “up to 23%”, to increase long-term care insurance premiums by 90% and to “spend $ 550 million on a new office building for executives of CalPERS “.

The text asked what would be the probability that the recipient would vote for him.

Then came a second text saying that Brown voted against increasing health premiums and said she “opposed spending $ 550 million on new offices in downtown Sacramento.”

Office building

Miller’s description of the $ 550 million office building is inaccurate.

CalPERS owns a long vacant lot on the corner of Third and Capitol, known colloquially as the “Hole in the Ground.” In June 2018, board members took a preliminary vote to approve a $ 550 million development proposal for the lot.

Miller voted in favor of the proposal and Brown voted against. But the building was never intended for CalPERS “executives” or any CalPERS staff, according to public summaries of the proposal.

Along with apartments, offices and commercial space, the building would have been a real estate investment intended to support the operations of CalPERS and the pension fund.

In the June 2018 vote by 12 board members, eight supported the proposal while three opposed it and one board member abstained.

CalPERS severed ties with the project developer, CIM Group, in 2019 and began working with Hines Real Estate. New details were not disclosed.

Brown said the texts included information about the vote “as conveyed to (him)”.

“There weren’t any tenants for the building, so did you think it would be used for executives, since there were no tenants? Maybe yes. How it was conveyed to us, the way we interpreted it, that’s what it meant to us, ”he said.

Health insurance rates

The CalPERS board of directors voted for 2022 health insurance rates in July. Employee plans will cost an average 5.65% more next year, while Medicare Advantage plans offered by CalPERS will see an average reduction of almost four-tenths of a percentage point.

The CalPERS board of directors voted 11-1, with one absence, to approve the rates, which system officials had negotiated with insurance companies. Brown was the ‘no’.

One of the plans, the PERS Select PPO, will increase by 23% next year. The plan was the cheapest option among the 14 plans CalPERS offers to everyone who is eligible for its health insurance, and around 110,000 people are enrolled in it.

The board of directors approved the 23% increase in this plan as part of a change to new pricing of its health insurance products. Under the old pricing structure, policyholders rushed from expensive plans with the best benefits to the cheapest plans with fewer benefits.

The richer diets, generally favored by older and less healthy people, were entering “death spirals” and are said to have become unsustainable, Marta Green, head of the research and development division, told the board. administration of health plans last year. The premiums for these plans are expected to drop next year due to the change in the board of directors.

The “risk adjustment” program adopted by the board of directors essentially transfers money from low health risk plans to higher risk ones. As part of the plan, prices will rise again in 2023 and then start to stabilize, Green said.

Brown said she couldn’t support the new pricing structure.

“Low cost PPOs are now subsidizing the best and most expensive plans and I just couldn’t do it,” she said.

Miller said the change was necessary for the stability of the Medicare program.

“Our responsibility, painful as it may be, is to make prudent decisions that are in the best interests of all of our members,” Miller said of his vote. “And trying to mitigate the impact by spreading the costs over time is one of the kinds of things we can do, but at the end of the day we have to make the decision that puts us on fiscally responsible ground and offers the benefits our members need and there really was no good alternative.

Dependence insurance

The council voted 10 to 1 in November, with one abstention and one absence, to approve the price increases for long-term care referenced in the texts. Brown was the ‘no’.

CalPERS vastly underestimated its long-term care insurance policies when it first started offering them in the 1990s, and the system has increased prices ever since, including an 85% rate hike spread over 2015 and 2016 which sparked legal action.

The board approved a 90% rate hike this year and next after insurance experts in the pension system said insurance products would not remain viable in the long run without the further increases .

“It was a disaster,” Miller said of the insurance. “I am so sorry for what happened with this and the impact on many of our members. But voting no and hiding your head in the sand and not addressing the financial and legal realities would not serve our members. “

Brown said she wanted CalPERS to reconsider the assumptions used to estimate future insurance costs, especially given the increased death rates last year.

Union endorsements

Local 1000 Brown President’s process for deciding whether to give union support to CalPERS Brown and Emon-Moran board members is a big departure from past practice, said elected member Theresa Taylor the 65-member SEIU Local 1000 Board of Directors and a CalPERS Board of Directors. member.

Taylor said that in the past, the Local 1000 Political Education Committee made recommendations to council on any political spending and then the council voted.

The board did not specifically weigh in on the CalPERS election, but voted in late 2019 to support candidates approved by the SEIU California State Council, of which Local 1000 is a member. At the time of the 2019 vote, former president Yvonne Walker represented Local 1000 on council.

The board supports Miller and Pacheco and has put the group’s name on campaign mailings supporting the candidates.

Brown said the decision to back Brown and Emon-Moran had to be made “quickly” and said it was in his power to authorize spending for the CalPERS election.

“Sometimes the leadership of a president will be different from that of another president,” he said.

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Wes Venteicher presents the popular cover of The Bee’s State Worker in the newspaper’s Capitol Office. It covers taxes, pensions, labor, state expenses, and the California government. Originally from Montana, he reported on healthcare and politics in Chicago and Pittsburgh before joining The Bee in 2018.


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