CHICO — The Chico Area Recreation and Park District is concerned about unfunded pensions, but its directors say it is in a better position than most public agencies.
During a 2018-19 budget discussion Wednesday, the directors of the special district talked about the future of pensions.
It has roughly $1.7 million set aside in its pension reserves, while its total pension liability – as of April – was about $2.4 million. That pension obligation changes regularly, noted CARD General Manager Ann Willmann.
Willmann told the board that $1.7 million is in reserves – but in “spendable, unassigned” cash. Nevertheless there are some options. While board members agreed they weren’t interested in touching that reserve, they did talk about the possibility of paying off fully or in part its CalPERS obligation.
That would get rid of a regular payment, along with interest charges, saving the recreation district money, Director Tom Lando noted.
Should CARD pay off part of its liability, it could lower its payments and lengthen the amortization period, Willmann noted.
Yet Lando noted that he thought the reserve should be left is, in fear the state could change what happens with pensions – by discounting or changing liabilities – and that money would be lost to CARD.
Willmann has been involved in a number of state-level pension discussions, and regularly reports to the board on pension discussions, especially as it pertains to the financial disasters that unfunded pensions are causing public agencies and governments.
The CARD board has lamented not being able to set aside more for deferred maintenance and equipment repair, so there was a short discussion whether directors wanted to use reserve funds for that, but the board agreed with Lando not to touch it.
The public hearing on the preliminary budget is planned for 7 p.m. June 21 at the Chico Community Center, 545 Vallombrosa Ave.
A better position than most agencies? Well, that’s pretty subjective. Here’s what Ann Willmann told me just a year and a half ago after a presentation from their Mattson and Isom auditor:
AW
Good Morning Juanita, I was actually just responding to your email. The answers to your questions are below.
The management staff has 3 PEPRA PERS members, therefore they pay their 6.25% employee portion. There are two CLASSIC members who currently pay 2% of the employee portion.
Our pension Liability for the 2015-16 fiscal year was $1,758,200 which is an increase of $57,480 from the previous year.
Thank you, Ann
I heard the auditor’s report and asked Willmann to confirm the numbers I’d scratched in my note pad. Yes, the consultant said CARD’s deficit would grow by about $57,000 a year, and that figure would increase with the size of the payroll.
I’d also asked Willmann about employee contributions. See she says, “2% of the employee share…” The “employee share” is 6.25 percent, so do the math (of means times…). Those classic members, one of whom is Willmann, pay less than 1 percent of their pension premium.
And Willmann, along with the other 30 or so management employees, gets a raise every year, so the pension premium goes up.
I don’t know if that explains why the deficit they just reported has increased over a half a million dollars beyond the deficit they reported in December 2016. According to the auditor’s figures, the deficit should only be about $1.8 million at this point – but it’s $2.4 million?
Doesn’t add up.
Here they also admit deferring maintenance while saving $1.7 million aside to pay their pensions. Are you outraged yet? Well, do what I did – write a letter to the editor of the paper that prints this crap. Tell your friends – we aren’t responsible for paying these insane pensions.
In December 2016 a Mattson and Isom auditor told the board of Chico Area Recreation District the agency had a pension deficit of $1,758,200. He said that was a increase of $57,480 over the previous year, and that CARD could expect a similar increase annually if employees continued to pay little or nothing toward their own pensions.
Chico Taxpayers Association 
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