Defined benefit plans must be fair to taxpayers, they must be financially sustainable, and the participants must pay their fair share.

26 Aug

CARD has another “informational” jam session this Wednesday evening, 7pm, at the CARD center on Vallombrosa.   I will be out of town, but hope others will attend. I must say, those meetings have been informational.

So, I wrote a letter to the editor about it!

I learned a lot attending two of Chico Area Recreation District’s parcel tax informational meetings.

I knew the pension cost is divided between employer share and employee share. But, I didn’t know,  for years CARD paid not only the employer share, but the entire employee share.  General Manager Ann Willmann said the agency now only pays 14% of their total CalPERS costs, resulting in a $2,800,000 pension deficit.

I misunderstood the Public Employees Pension Reform Act, thinking employees would pay 50% of their actual pension cost. Instead, they are only asked to pay 50% of CARD’s total payment of 14%. CARD employees agreed to pay an additional 1% of the employer cost, making their total contribution an unsustainable 8%.

Willmann also mentioned “aggressive payments” made toward the pension deficit itself. Whenever there is a downturn in the stock market, CalPERS demands more of it’s members, and the taxpayers are expected to pick up the tab. CARD created a “Pension Stabilization Trust”. Willmann admitted that maintenance to facilities like bathrooms has been deferred while the agency diverted funding to the pension trust.

Instead of new taxes, we need true pension reform.  Starting in 1999, CalPERS and powerful union lobbyists  pushed through unrealistic and unsustainable salaries and benefits for agencies all over California. These agencies have funded their pensions by cutting services and deferring maintenance – putting their pensions ahead of their mission to serve the public. Defined benefit plans must be fair to taxpayers, they must be financially sustainable, and the participants must pay their fair share.

 

4 Responses to “Defined benefit plans must be fair to taxpayers, they must be financially sustainable, and the participants must pay their fair share.”

  1. Scott Rushing August 26, 2019 at 2:07 pm #

    Great article Juanita

    On Mon, Aug 26, 2019 at 6:12 AM Chico Taxpayers Association wrote:

    > Juanita Sumner posted: “CARD has another “informational” jam session this > Wednesday evening, 7pm, at the CARD center on Vallombrosa. I will be out > of town, but hope others will attend. I must say, those meetings have been > informational. So, I wrote a letter to the editor ab” >

    • Juanita Sumner August 26, 2019 at 2:19 pm #

      Thanks Scott, it’s hard explaining this stuff.

  2. bob August 26, 2019 at 7:47 pm #

    CARD has another “informational” jam session…

    Informational? I think you misspelled propaganda. 🙂

    General Manager Ann Willmann said the agency now only pays 14% of their total CalPERS costs, resulting in a $2,800,000 pension deficit.

    I bet you or someone else had to pull some teeth to get that and some of the other info you mentioned out of her. And I bet the firm they paid all that money to told Wilmann to not mention any of that unless she had to. That kind of information doesn’t go over very well when trying to sell a tax increase.

    • Juanita Sumner August 27, 2019 at 3:49 pm #

      Yeah, I’m sure the consultants tutored Willmann very thoroughly, that’s what they are paid for! And you have to ask the question carefully, keep it simple, and then fact check the abswer.

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