More public pension loony tunes – now Providence RI is in trouble

[CA renter]

[quote=harvey][quote=CA renter]Taxpayers are now having to pay for the contributions that WERE NOT MADE by “taxpayers” during the good times.[/quote]

Once again this is absolutely false, and the text you cite (boldface or not) does not say anything about state or municipal agencies (“employers”) failing to make the required contributions.

CalPERS has never accepted an IOU from the state or a city. Your claim is a complete fabrication.

Every state agency and city has paid their contributions in full. In fact, even while in bankruptcy, Vallejo continued to pay CalPERS the full contributions, and gutted city services in order to meet the payments:

It kept making all of its contributions to Calpers throughout its three-year bankruptcy.

“We never shortchanged Calpers,” said Robert V. Stout, Vallejo’s finance director at the time.

And did public employees make concessions? Nope, they sued in order to keep it at all:

But Calpers drew a line in the sand, warning Mr. Stout and his lawyers that in California, public pensions can be increased but never decreased, not just for retirees, but also for workers at midcareer.

More examples of public employees fighting concessions:

http://sanfrancisco.cbslocal.com/2012/03/20/san-jose-police-union-sues-city-over-pension-ballot-measure/

(Links are posted for the benefit of everyone except CA Renter, since we know she simply ignores facts from credible sources. Just like she did with ones I posted up thread that she still has not acknowledged.)

There have been some minor concessions forced upon public employees (out of necessity), but nothing that comes even close covering the shortfall.

The money covering the shortfall has been coming from:

– Deficit spending (hence the state’s poor credit rating)

– The state’s general fund, as cited in a link in my post above

– Cuts in programs, particularly schools. In my own school district, teachers were just laid off and elementary class sizes have increased to 30 students.

– (pending) Tax increases (see Jerry Brown’s ballot initiative referenced in blake’s post above)

Pubic employees and public-employee unions are not offering any compromises whatsoever. They are simply suing the state and city governments at every opportunity in order to demand more taxpayer money, forcing cuts in services and ultimately tax increases.

CalPERS, their lawyers, and their union cohorts are nothing more than financial bullies who literally rob schoolchildren.

Sorry CAR, your “one word” answer is completely wrong. If it were correct, there wouldn’t be a shortfall, would there?[/quote]

You are wrong, again.

Myth: Pension Costs for the State of California have increased by 2000 percent in the last 10 years.
March 15, 2010

Fact:
This statement compares a time when the State paid little or nothing during years of robust investment earnings and took a pension holiday to the recent market cycle extremes and current economic downturn.

Fact:
In 1981-82, pension contributions for the largest category of employees cost the State 19.6 percent of payroll. For the current 2009-10 fiscal year the state is paying 16.9 percent.

Fact:
The State of California pays less as a percentage of payroll today than it did in the early 1980s.

1981/82 2009/10
State Miscellaneous 19.563% 17.528%
State Safety 20.409 15.702
CHP 31.995 29.956
School Miscellaneous 13.020 10.707

http://www.calpersresponds.com/myths.php/myth-pension-costs-increased-by-2000-percent

I know for a fact that many local governments also paid NOTHING toward pension costs during the bubble. Of course, this wasn’t bandied about in the MSM like the current catch-up contributions are.

…..

Myth: Prior to SB 400, the State paid $400 million in contributions. Ten years later, the State is paying $3 billion due to benefit enhancements.
September 23, 2009

Fact:
The $400 million paid in 1999 was the lowest the State had paid in generations and it was due to the fact that the investment returns in the mid-1990s were so high, little was needed from the State to cover the plans. Some years, the State paid zero contributions for schools. This was due to higher than normal investment returns. Using a starting point of $400 million is misleading, because the late 90s was an atypical period for investment returns. In addition, payroll growth (bigger government) investment losses and people living longer and retiring earlier are the primary drivers of increased pension cost, not enhanced benefits. Employer contributions have actually decreased due to public employees paying more toward their pensions. View information regarding the breakdown of the change in State contributions between 1997-1998 and 2009-2010.

http://www.calpersresponds.com/myths.php/myth-3-billion-in-benefit-enhancements

———————

Myth: Government workers don’t contribute to their pensions; taxpayers are on the hook to pay those costs.
January 12, 2010

Fact:

State employees contribute between 8-12 percent of their monthly earnings. Local public employees pay up to 10 percent of their paychecks toward pensions. In recent collective bargaining agreements, additional contributions by State employees will save the state up to $300 million a year.

http://www.calpersresponds.com/myths.php/myth-Government-workers-dont-contribute-to-their-pensions

This was written in 2010. Since then, the employee share of the contributions has gone up when new contracts are negotiated.
——————-

Myth: Police and firefighters retire at age 50 with 90 percent of pay.
September 23, 2009

Fact:

Our records indicate that over the last seven years, safety workers who retired at age 50 with 30 years of service represented 1 percent of all those retired. The reason very few ever would receive this level pension is that they would have had to start working age 20 to earn 30 years. Most start their safety careers at age 27, 28, or 29.

Twelve percent of all public safety members are subject to the 3 percent at age 55 formula. They would need 37.5 years of service at age 50 to get 90 percent, and would have had to start working at age 12.5 to earn 37.5 years. And 7 percent of all public agency safety members are subject to the 2 percent at age 50 formula. They would need to have 45 years of service at age 50 to get 90 percent, and would have had to start working at age 5 to earn 45 years.

http://www.calpersresponds.com/myths.php/myth-police-and-firefighters-pensions
——————–

I also want to point out that class sizes are simply returning to NORMAL. The norm for class sizes was 32-40 pupils per classroom before they reduced class sizes in ~1996. Guess who was responsible for class size reduction and who fought it when it was repeatedly attacked…those evil teachers’ unions!

Class Size Reduction, K-3 (Senate Bill 1777, 1996)
In 1996, the Legislature created the Class Size Reduction (CSR) program, which provided incentives for school districts to reduce K-3 classes to a pupil-teacher ratio of no more than 20 to 1. This legislation originally provided annual incentive funding of $650 for each student in a smaller class and an option of $325 for students in a staggered session in which the pupil-teacher ratio is no more than 20 to 1 for half the day. The next year these incentives were increased and annual inflation adjustments were added. A one-time allocation of $25,000 per added classroom was also made available for full-day classes to improve facilities or acquire portable classrooms.

http://www.edsource.org/iss_fin_sys_csr.html

http://archive.cta.org/CaliforniaEducator/v7i5/stand_1.htm

[CA renter]

More:

« CalPERS boosts cost of terminating pension plansCalPERS: a 112th green, social, corporate policy »Pension reform: easier said than done
A bill for a public pension reform advocated by Gov. Brown, and a commission appointed by former Gov. Schwarzenegger, has a labor sponsor, no formal opposition and therefore smooth sailing in the Legislature, right?

Not exactly.

The bill preventing CalPERS and county systems from lowering employer contributions when investment earnings are booming, and instead put excess money in a “rainy-day” reserve, shows how reform can be technically and politically complex.

Much pension reform legislation this year is scandal driven, responding to big salaries in the city of Bell, pay-to-play investment corruption at CalPERS and the boosting or “spiking” of pensions, notably by two Contra Costa fire chiefs.

Some of the bills are being watered down or delayed until next year — among them an anti-spiking measure, SB 27, that the California State Teachers Retirement System wants to change.

One of the few bills dealing with the big issue, pension funding, is the limit or ban on employer contribution “holidays” sponsored by the California Professional Firefighters, AB 1320 by Assemblyman Michael Allen, D-Santa Rosa.

“AB 1320 will ultimately safeguard against any sudden increases in employer contribution rates, thereby providing budget stability and sustainability,” said the firefighter group.

The bill is an expression of faith that the pension funds, now often only 60 to 70 percent funded, will one day return to financial health, despite dire predictions from reform advocates who urge major restructuring.

A provision in the original version of the bill also is a nod to the labor sponsors. The “rainy-day” reserve, if times were really flush, could be used to lower the pension contributions of employees.

The goal is a reserve to help government employers pay higher pension contributions when investment earnings falter, avoiding rate shock. CalPERS dropped employer rates to zero or thereabouts in the late 1990s during a stock market boom.

A state CalPERS payment that had been $1.2 billion dropped to about $150 million (as CalPERS sponsored a 50 percent pension increase, SB 400 in 1999). By 2005 the state rate had soared to $2.5 billion.

Schwarzenegger cited the dramatic five-year increase as he briefly backed a proposal in 2005 to switch new state and local government employees to a 401(k)-style individual investment plan.

An extreme example is the University of California Retirement Plan. The UC system, not included in the firefighters’ bill, went without contributions for two decades, getting by on investment earnings before payments resumed last year.

A UC staff report said the system, now planning to phase in a major contribution increase for employers and employees, would have been about 120 percent funded last year if normal contributions had continued since 1990.

Pension reform: easier said than done

[Anonymous]

Not a single mention of the word ‘shortfall’ in all of that.

All the links with your ‘proof’ are from biased or sketchy sources: “CalPERS Responds” ??

Why no major newspapers? Why can’t you get your “facts” from the NY Times, the LA Times, or the Economist, etc. like everyone else here?

None of my assertions are false. I said that nobody ever gave CalPERS an IOU. That is a fact.

Yup, CalPERS mismanaged the funds, underestimated the required contributions, overestimated returns. The unions were complicit. We know all that. We’ve said all that already.

And now CalPERS is trying to cover their asses with their “CalPERS responds” propaganda. And you swallow it whole.

Do you get why people call you an anvil?

Not once did you mention the word ‘shortfall’ in all that long-winded crap.

Once again, you completely avoided the crux of the issue.

You can come up with twisted explanations of blame all you want.

Fact is, there is huge bill due.

Who is going to pay it?

[Coronita]

[quote=harvey]

Fact is, there is huge bill due.

Who is going to pay it?[/quote]

We already know who… The question is why.

[CA renter]

[quote=harvey]Not a single mention of the word ‘shortfall’ in all of that.

All the links with your ‘proof’ are from biased or sketchy sources: “CalPERS Responds” ??

Why no major newspapers? Why can’t you get your “facts” from the NY Times, the LA Times, or the Economist, etc. like everyone else here?

None of my assertions are false. I said that nobody ever gave CalPERS an IOU. That is a fact.

Yup, CalPERS mismanaged the funds, underestimated the required contributions, overestimated returns. The unions were complicit. We know all that. We’ve said all that already.

And now CalPERS is trying to cover their asses with their “CalPERS responds” propaganda. And you swallow it whole.

Do you get why people call you an anvil?

Not once did you mention the word ‘shortfall’ in all that long-winded crap.

Once again, you completely avoided the crux of the issue.

You can come up with twisted explanations of blame all you want.

Fact is, there is huge bill due.

Who is going to pay it?[/quote]

Pri,

Where do you think the newspapers get their info? I’m citing the primary source, which is more credible than any other source.

Maybe it’s the reading comprehension problem again, but one of the reasons for the SHORTFALLS is the fact that public employers (READ: TAXPAYERS) paid little to nothing toward pensions during the good years. The unions fought them on this, but lost.

It’s funny that nobody — especially taxpayer advocacy groups/privatization proponents — were commenting on the SAVINGS that were a result of the market bubbles. It’s only when the bubbles burst and employers have to make up for the years that contributions weren’t made that this issue is bandied about in the MSM. Gee…I wonder why? Think there might be an anti-union/anti-worker agenda? Guess what? If you or any member of your family works for a living, you will be hit by this, too. You will not save any money or make any additional money as a result of weakening unions.

You need to understand WHO is behind the attacks on unions, and WHY. Ignore this at your own (and every other public and PRIVATE sector worker’s) peril.

[Anonymous]

[quote=CA renter]I’m citing the primary source, which is more credible than any other source.[/quote]

If you believe that a piece titled “CalPERS Responds” is a credible, objective source without an agenda, then you truly are hopeless.

[CA renter]

[quote=harvey][quote=CA renter]I’m citing the primary source, which is more credible than any other source.[/quote]

If you believe that a piece titled “CalPERS Responds” is a credible, objective source without an agenda, then you truly are hopeless.[/quote]

That response is directly from CalPERS. Where else do you think newspapers, etc. are going to get their information? You don’t have to believe me, check out where the anti-union folks are getting their info, too.

[Author]

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