OT: California’s Third Largest City

[admin]

Many people don’t realize just how big San José is.

It doesn’t get the same name-recognition as San Fransisco and San Diego. But with a population of nearly one million, it’s close in size to San Diego.

And San Jose is in a severe financial crisis. Why?

You guessed it! – Employee pensions.

From Chuck Reed (D), the mayor of San Jose:

http://www.sanjoseca.gov/mayor/goals/budget/PensionProblem.asp

Did you know that San José expects to spend about $245 million in FY 2011-12 to pay for lifetime pension and retiree healthcare benefits for employees? That is three times more than it paid a decade ago! In addition, retirement costs now take up more than 20% of the city’s General Fund and are one of the primary drivers of San José’s structural budget deficit.

And who pays for these pensions?

Both the City and employees make contributions into the retirement funds. However, the City is responsible for a significantly larger share of the costs than employees.

Every day we hear another story about funds being cut to local schools. Teacher layoffs, larger class sizes. Services being cut, state parks being closed.

San José is the harbinger. The same problems are developing at the state level and to hundreds of other cities in CA.

Jerry Brown is pushing hard to raise taxes. He says it is to help save the schools.

What is he really trying to save?

[SD Realtor]

wait for it….

[briansd1]

[quote=pri_dk]
Every day we hear another story about funds being cut to local schools. Teacher layoffs, larger class sizes. Services being cut, state parks being closed.
[/quote]

I haven’t heard this argument lately but I’ll make it just for fun: “If we could deport all the illegal immigrants and deny services and citizenship to even American born children of undocumented immigrants, we could have even more layoffs and use that money to shore up the pensions and salaries of the remaining public employees.”

[quote=pri_dk]
San José is the harbinger. The same problems are developing at the state level and to hundreds of other cities in CA.
[/quote]

Mama mia, I did not know that San Jose came with an accent.
http://www.sanjoseca.gov/

On April 3, 1979, the San Jose City Council adopted San José, with the diacritical mark on the “e”, as the spelling of the city name on the city seal, official stationery, office titles and department names. Also, by city council convention, this spelling of San José is used when the name is stated in both upper- and lower-case letters, but not when the name is stated only in upper-case letters. The accent reflects the Spanish version of the name, and the dropping of accents in all-capital writing was typical in Spanish. The name is still more commonly spelled without the diacritical mark as San Jose. The official name of the city remains City of San Jose with no diacritical mark, according to the City Charter.[17] However, the City’s website uses San José.[18]
http://en.wikipedia.org/wiki/San_Jose,_California

[Anonymous]

[quote=briansd1]I did not know that San Jose came with an accent.[/quote]

I took care to be culturally sensitive. I’ve been wrongly accused of being a Fox News stooge. That hurts a sensitive guy like me.

[sdrealtor]

[quote=SD Realtor]wait for it….[/quote]

lol

[SD Realtor]

hehehehheh

[enron_by_the_sea]

Santa Clara will join that list soon now that they are building 49ers stadium!

And our our mayor proclaimed that we are off the bankrupcy list (finally!), so our pols can not wait to build the new stadium fast enough so that we can get back on it.

[desmond]

And Stockton (Cal’s 13 largest city) is on the outside and coming fast:

http://www.huffingtonpost.com/2012/02/29/stockton-bankruptcy-california_n_1311339.html

[briansd1]

[quote=enron_by_the_sea]
And our our mayor proclaimed that we are off the bankrupcy list (finally!), so our pols can not wait to build the new stadium fast enough so that we can get back on it.[/quote]

Actually, as I said before, municipalities are like big corporations. They are incorporated similarly and bankruptcy laws do apply to local government.

So, San Diego is better off declaring bankruptcy and renegotiating employment contracts in bankruptcy court.

Although they have billions in cash, American Airlines declared bankruptcy to screw their pilots and unionized employees and redo contract. Not good for existing employees but it’s good for long term survival of the company.

Municipalities will looks for ways to raise taxes; and they will cut services to protect remaining employees… but citizens and businesses will be left with ineffective zombie local government for years.

I think better to declare bankruptcy and start fresh. Bankruptcy sounds bad, but it a better deal for taxpayers.

[SD Realtor]

We should have declared bankruptcy several years ago.

[blake]

City has over 1,300 making $100,000-plus

Source: Office of City Councilman Carl DeMaio

[paramount]

How much more can be said that hasn’t already been said: Public Employees and their Unions HAVE bankrupted California. End of story.

[svelte]

[quote=pri_dk]…You guessed it! – Employee pensions.

From Chuck Reed (D), the mayor of San Jose:

…[/quote]

I guess you found it important to put the (D) in there cuz cities with Republican mayors have never had pension problems…

[blake]

CalPERS considers moves that would boost pension costs for governments

[quote]
…
In a memo to the CalPERS board, actuary Alan W. Milligan suggested lowering the assumed annual rate of return to 7.25% from 7.75%, a decade-old benchmark, as the state continues to grapple with the slow recovery from the Great Recession.

Milligan also is recommending that CalPERS, the nation’s biggest public pension fund with a value of $238.4 billion, lower its ongoing inflation assumption to 2.75% from 3%.

The effect of the two changes would raise the state government’s employee pension costs as much as 4.5% in the fiscal year that begins July 1. Some pension costs for public safety agencies could jump as much as 6.6%, according to Milligan’s report to the board.

Last year, the board rejected a more modest Milligan recommendation to lower the assumed rate of return rate to 7.5%. Members at the time were concerned about the financial effect on local governments that were struggling to pay for basic services because of declining tax revenue.
…
[/quote]

[Anonymous]

[quote=svelte]I guess you found it important to put the (D) in there cuz cities with Republican mayors have never had pension problems…[/quote]

I noted that he was a Democrat because some have tried to dismiss the facts about pension problems as “right wing propaganda.”

Mayor Reed’s page contains a wealth of ominous data.

There are people that are capable of looking at the facts objectively regardless of their political “team.”

Are you one of them?

[Author]

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