Posted on 11/27/2005 12:25:49 PM PST by NormsRevenge
The new year may be five weeks off, but it's a safe bet we already know what one of the big stories of 2006 will be: a pending Legislative Analyst's Office report on the total amount that school districts and local and state governments owe for the pensions, health care and other benefits going to retired public employees. It's going to be a stunner – definitive proof that the city of San Diego is far from alone in having pension benefits that taxpayers can't afford.
While San Diego's shortfall is conservatively estimated at $1.4 billion, a Los Angeles Daily News report in September estimated the unfunded liability statewide is at least $110 billion. When the respected, nonpartisan LAO puts out such numbers, then maybe state lawmakers will finally own up to the enormity of the problem instead of pretending all is well.
And when this culture of denial comes to an end, step No. 1 is obvious – because it already has been suggested by Assemblyman Keith Richman, R-Granada Hills. That step is a full and independent audit of the California Public Employees Retirement System, the state's biggest pension program.
The bureaucrats who run CalPERS are a self-impressed bunch who hold themselves up as peerless public servants. Nevertheless, there are credible charges that the pension giant is playing fast and loose with accounting practices in a way that obscures the total tab the public must someday pay.
The most prominent accuser is Marcia Fritz, a Citrus Heights certified public attorney who is a former CalPERS consultant with more than 30 years of public accounting experience. In a Sept. 30 letter to the Governmental Accounting Standards Board, Fritz contends that the advice CalPERS actuaries gave in the late 1990s to government agencies pondering retroactive pension benefit increases and earlier retirement ages left unclear the long-term costs of such moves. For example, many agencies didn't even consider the additional long-term health care costs that would result if they allowed employees to retire at a lower age.
CalPERS denies any wrongdoing, and Fritz does not appear to be alleging criminal misconduct – just that CalPERS should have done a far better job in vetting big changes in the pension system. That much seems obvious, and it would be valuable to have an official report making the case.
So bring on a thorough, independent audit of CalPERS. There's not much we can do to limit the future fiscal pain stemming from past pension mistakes; legally granted pension spikes can't be reversed. But a CalPERS audit would help signal that times have changed – and that the actuaries whom taxpayers must count on for protection are going to be closely watched from here on out.
If CalPERS is truly as well-run as its bosses insist, then the pension agency should welcome such an audit – not whine about it.
This does a much better job of explaining the mess the public pension system is in than I was able to. This defines CalPers, but California certainly isn't alone.
Oh yes they can. In a heartbeat. And they should.
Retirees are not sacred or demigods. Pension reductions back to sustainable levels (50% of average, high income) are warranted. Those who supped at the public trough can now rest with the herd.
Aren't they all. County, state or federal bureaucrats are all obnoxious, but it is my experience that a state bureaucrat is the most arrogant and ineffective of of them all. The public employee unions have been looting the California taxpayers for over 20 years. The retired 55 year old CA fireman, driving around in a Bentley, should soon come to an end.
They also need to shine a bright light on CALPers latest "smoothing" maneuver (accounting change) which now spreads losses over 15 years, instead of three. More obligations for our kids to pay for in following generations. I hope the audit also looks at some of the scummy investments Calpers has been making lately and holds them accountable. ,
This was one of the items the co's received when their union bribed Gray Davis.
Where's the danged proofreader??? Sloppy journalism!!! These used to be called Certified Public Accountants, NOT attorneys! Sheesh!!!
What's Willy Brown's role been in all this? That not so slick move by the Grininator sure doesn't please this taxpayer!!!(see calcowgirls reply)
There is some excellent coverage on all of the pension schemes that the SacBee has done over the past couple of years.
For a taste, start at the following link. For further reading, check the other pension stories linked in the sidebar.
http://www.sacbee.com/content/news/projects/pensions/story/9235530p-10160700c.html
The California National Guard has now learned how to play the pension game, too. I just posted this story tonight:
http://www.freerepublic.com/focus/f-news/1529563/posts
I noticed that too. I thought it was some new fandangled career path, lol.
Wow! You track this stuff so well. I'm jealous!
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