While our City Council (Teresa Barth excepted) buries its head in the sand about the pension crisis, our neighbors down south are getting serious.
A proposed ballot measure by Mayor Jerry Sanders and City Councilman Kevin Faulconer would alter San Diego’s pension system in profound ways that they say would save a projected $1.6 billion for taxpayers over the next three decades.
The measure calls for the most strict cap on public-safety pensions among the state’s largest cities, a switch to a 401(k) for new hires in all other city jobs and a cap on the city’s overall payroll for five years. In addition, it would remove a provision from the city charter that gives workers the ability to veto benefit changes with a majority vote — which some city leaders say makes it difficult to push through significant reform.
Yesterday, economist Eric Falkenstein commented on CalPERS' rosy 7.75% return assumptions.
Either someone invents cold fusion, the Mayan alien astronauts bring us all sorts of manna when they return in 2012, or we will monetize our debt to pay for all these off-balance sheet liabilities. I'm betting on the latter.
And even though we are still pushing the vast majority of the pension costs onto the next generation by using phony assumptions and under-contributing even for those rosy assumptions, the tiny portion of pension costs that we are actually paying for today are crimping the city budget so that Olivenhain can't even have a fire station. Honestly, Olivenhain ought to just secede and go back to the county. They pay all these taxes into the city and what do they get for it?
What will it take for the Council majority to wake up?