Council will hear Pension Obligation Bond presentation at Jan 5 2021 meeting

24 Dec

Wow, yeah, Merry Fucking Christmas – want to see what you can expect in your stocking this year?  Look over next year’s first council agenda – it’s a big lump of coal called a “Pension Obligation Bond,” and they’re trying to tell us it’s not really a tax, it’s just a “restructuring” to a lower interest rate. That is not true. 

And on top of that, our new/old Mayor Andrew Coolidge is also calling for a “streets” bond. Read all about it here:

AGENDA FOR 1/5/21

http://chico-ca.granicus.com/GeneratedAgendaViewer.php?view_id=2&event_id=351

5.1. CALPERS PENSION COSTS AND UAL RESTRUCTURING PRESENTATION
The City of Chico (the City) continues to explore various cost management strategies for its $146 million
unfunded accrued liability (UAL) with the California Public Employees Retirement System (CalPERS). At
the September 23, 2020 Finance Committee, the City and NHA Advisors (NHA) made a presentation
discussing the City’s most recent actuarial report released by CalPERS in July 2020. The City and NHA
provided a discussion on alternative repayment strategies, including a restructuring of the UAL. The City
and NHA will make a similar presentation at the January 5, 2021 City Council meeting to assist in providing
continued education on these topics. (Report – NHA Advisors)

FROM STAFF REPORT:

https://chico-ca.granicus.com/MetaViewer.php?view_id=2&event_id=351&meta_id=74726

As current interest rates are at historically low levels, combined with the fact that the City has exhausted many of
its other resources to address rising pension costs, City staff asked NHA to assist them in evaluating the merits
(including benefits and risks) of a UAL restructuring. A UAL restructuring (either through a Pension Obligation
Bond (POB) or a Lease Revenue Bond) entails converting 7% debt with CalPERS to lower debt on a bond
(currently between 3.50% and 4.00%).

That is a FLAT OUT LIE. We will be incurring NEW DEBT, and if the investments they make with the bond money do not pay off, we owe not only the 7% to CalPERS but that 3.5 – 4% for the bond. Read this post for background:

https://chicotaxpayers.com/2020/10/09/heres-the-video-from-that-sept-23-finance-comm-meeting-ever-wonder-what-people-are-saying-about-your-money-behind-your-back/

NOTE: Oh, crap, the video has been taken down! I’ll have to repost it asap. 

4 Responses to “Council will hear Pension Obligation Bond presentation at Jan 5 2021 meeting”

  1. Scott Rushing December 24, 2020 at 1:56 pm #

    The hiring of additional police officers will also greatly impact the budget in the many ways you have pointed out. The CPD already siphons off 54% of the city annual operating budget.

    *Scott Rushing*

    On Thu, Dec 24, 2020 at 1:50 PM Chico Taxpayers Association wrote:

    > Juanita Sumner posted: “Wow, yeah, Merry Fucking Christmas – want to see > what you can expect in your stocking this year? Look over next year’s > first council agenda – it’s a big lump of coal called a “Pension Obligation > Bond,” and they’re trying to tell us it’s not really a tax,” >

    • Juanita Sumner December 25, 2020 at 7:36 am #

      Thanks Scott! When I used to say that, I got creeps coming around to call me a liar, it’s good to hear it from somebody else. Yes, the cops get over half our budget. Our budget has also grown disproportionately ahead of our town. I remember roughly $50 million a year, now our budget is around $100 million a year. I’ve had people, always using fake names, come around to call me out on that, but yeah, it’s true. And it’s all salaries and benefits, mostly for cops and then fire.

      People just won’t open their eyes – we spend $11 million a year, a growing figure, just on the pension deficit. People want to complain, but they don’t want to put the time into really learning anything about how it works. It is frustrating.

      I’m a little Dutch Boy, it’s absolutely impossible for one person stick hold a finger in all these holes. Especially me, with short arms. Thanks for coming around to lend a finger!

  2. Dave December 26, 2020 at 10:48 am #

    It’s clear the new “conservative” majority plans to get us deeper into debt and raise taxes.

    They call themselves conservatives but there’s nothing conservative about them. They are frauds and tools of special interests.

    Chico First? What a joke. It’s special interests first, as usual.

    And no matter who you vote for, all you will ever get is more debt and higher taxes. That’s because in this corrupt little city only tools of special interest stand any chance of winning a seat on the city council.

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