so passed it along to an actuary for analysis/thoughts on the topic
[quote] …SAN DIEGO CITY ERS PENSION NOT IN A GOOD PLACE
I am going to walk you through the San Diego City ERS plan info.
Let me start with the required contributions. Brace yourself. This is the “required contribution” – that is, the part that covers the new benefits accrued (i.e. retirement benefits earned due to work done in that fiscal year) plus a portion of the unfunded liability (i.e., paying off a bit of the benefits that were earned years before, but weren’t sufficiently contributed for.)
You ready?
58% of payroll.
Holy shit.
That’s insane.
Even Police & Fire pensions, which tend to have high contribution rates (for a variety of reasons) tend to have rates far below that.
See that yellow line waaaaay below the blue bars? That’s the average ARC as a percentage of payroll, and nationally, it’s about 15% for peer pension groups. 58% is insanely high.
FYI the local political bureaucracy recognized long ago that “the concept of Surplus Earnings” (and associated w/ the 13th pension check) was acknowledged as being NOT math kosher
[quote]
‘…in 2008, by ordinance, the Council eliminated “the concept of Surplus Earnings” because it was not consistent with sound actuarial principles and because it was being used for certain payments, which were not consistent with federal tax law or state law requirements to assure the competency of the assets of SDCERS. SDMC § 24.1501.’
yet the local political bureaucracy (who also benefit in various ways from the status quo) allows piling debt on top of existing debt year after year? and they expect the taxpayers to pick up the billions in clean up cost$ for their bad math mistakes??
