Thanks to Joe Azzarito for this thoughtful take on city resource allocation.
The term equity has been bandied about by social progressives lately as cause for radical change in society. By definition, equality means “the state of being equal, especially in status, rights and opportunities.” It has to do with giving everyone the exact same resources, whereas equity “involves distributing resources based on the needs of the recipients”.
Let’s apply these terms to City of Chico expenses, specifically to its employees’ salary, pension and other benefits. Much has been rebutted against the use of Pension Obligation Bonds as a panacea for its enormous and growing unfunded actuarial liability due its staff.
If we consider the most appropriate use of available revenue in the service of citizenry, it behooves the Chico City Council to find a solution to the many ignored uses for money. The recipients of the excessive largesse, in the form of city paid pensions, would not in the slightest be equitable when balanced off against needs of citizens. With their six figure incomes, they can well afford to fund their own retirement, regardless of what has gone before.
Chico’s many problems, such as affordable housing for all, street repaving, safety both from crime and fire, should be the focused uses for reported increased revenues. The double indebtedness that pension bonds would create, between bondholders and CALPERS, is not establishing equity. It is exacerbating the problem. The city‘s citizens have more unmet needs, in the form of services, than well heeled staffs do. Let’s DO EQUITY not just TALK IT!
Joe Azzarito, Chico CA
I’ll say this – the fox is in charge of the henhouse, so the fox gets what he wants, and the hens, well, they just get it.
Andrew Coolidge told a room full of people that “my friend Juanita Sumner is a liar...”
A friend of mine told me, “when you call a liar who has called you a liar, a liar, it just sounds like the biggest pissing match in town…” How true. Well, get out your hip waders, cause the piss is running deep these days.
Have you watched the video of the September 23, 2020 Finance Committee meeting yet? Don’t take my word for it, watch the video. And do me a favor – if you hit this link and it doesn’t work, get right back to me at “Comments” here and I will repost it.
I wrote a letter to the Enterprise Record hoping more people would watch the video. If you watch the video, you’ll see why our clerk Spike Presson does not usually make these recordings available to the public.
Mayor Andrew Coolidge and Councilman Sean Morgan have denied that a Pension Obligation Bond is new debt.
I have a recording of the 9/23/20 Finance Committee meeting at which consultants Mike Meyer and Eric Scriven of NHA introduced the POB to committee members Sean Morgan, Ann Schwab and Randall Stone. Meyer described POB’s as “issuing debt to pay off a portion of that UAL (aka, ‘pension deficit’).”
According to Wikipedia, “a bond is an instrument of indebtedness, of the bond issuer to the holder.” Investopedia defines “issuing debt” as “a financial obligation that allows the issuer to raise funds by promising to repay the lender…”
Meyer described a scheme by which bond issue (borrowed money) would be invested in the stock market, in an attempt to make enough money to pay both the bond debt and the UAL.
The consultants pointedly ignored the obvious solution – employees need to pay more. Currently they only pay between 9 and 15% for pensions of 70 – 90% of salaries of over $100,000/yr.
City leaders also need to better manage employee costs. Even while UAL payments have increased by millions, at the cost of city infrastructure and services, the UAL has grown 43% over 5 years. Instead of observing attrition measures recommended by the Government Finance Officers Association, management has added three new management positions, raised the police chief’s salary by $30,000/yr, and raised the clerk’s salary by $10,000/yr.
POB’s are a crackpot scheme at best and Coolidge and Morgan should be ashamed for perpetuating misinformation.
A couple of members of Chico Republican Women Federated recently told me that Mayor Andrew Coolidge, speaking to an unmasked assemblage of the club, called me a liar, in exactly those words. He says the Pension Obligation Bonds are “not new debt.”
Hey Jackass, trying to “cancel” me? Well here’s the video of the September 23, 2020 Finance Committee meeting at which the city’s consultant said exactly the opposite.
I’ll tell you something else – ever since Dave Howell posted that video at Gofile, it’s been repeatedly removed. I don’t know by whom, but the “remove” button is right there at the bottom of the screen. Obviously, somebody doesn’t want the citizens of Chico to see this meeting. In fact, I think it was a total mistake that I got a recording of it – I asked a lower level staffer and she gave it to me. But now the clerk – who will be getting a salary spike of roughly $10,000 at tonight’s meeting, in anticipation of her pending retirement – says they don’t record the meetings because they aren’t required by law. That’s not true, they record the meeting so they can produce the minutes – how do you think I got the recording? Then they show the minutes to full council, who are allowed to redact comments and who knows what, and when she’s done “amending” the minutes, she tosses that recording so nobody will be the wiser.
Tonight she’ll spike her salary up to $144,000+ a year, like they all do. She’ll receive 70% of that figure in retirement. I’ll admit, she’s pretty good at her job, but she’s better at looking out for her own interests than those of the public.
So, there it is. They got their Pension Obligation Bond and now the spiking begins. They will make no real attempt to control employee costs – why bother? They’re on The Gravy Train now!
But, what they won’t admit, is that there’s trouble on the horizon if they can’t get the sales tax increase that Andrew Coolidge is pushing. He wants a separate road bond too, because, as he already acknowledged, the sales tax revenue will be used to secure the POB. The consultant made it pretty clear – watch that video – they will need a revenue stream to secure the bonds, because the market is tricky, and they may not be able to earn enough in investments to cover either the POB. OR! the pension deficit. See, their investments have to pay off well enough to pay both the bond service AND the pension deficit, or this whole plan is BUST.
Dave Howell watched the meeting and then wrote a good analysis of what’s happening:
That finance meeting WAS PACKED with crazy and outrageous information. And the local media DIDN’T MENTION ANY OF IT!
Here are some key takeaways the local media should have covered:
Last year at this time we thought the unfunded pension liability we were on the hook for was $128 million. Well, this year the bureaucrats and consultants say $146 million. AND NOW THEY TELL US WE OWE ANOTHER $140 MILLION IN INTEREST! But these numbers are low because they don’t include the 4.7% under performance from last year and also the prior year’s under performance. IT IS OBSCENE! WHERE THE HELL IS THE LOCAL MEDIA ON THIS?
UAL for CalPERs is 146.3 million which is a 43% increase over the last 5 years. UAL payments are now 9.9 million in 2021 and will grow to 13.2 in 2026. And remember this is assuming an unrealistic 7% CalPERs return. In all likelihood this number will be even worse as over the last 20 years CalPERs hasn’t come close to 7%. CalPERs return has only been 5.5%.
The City’s pensions are only 67% funded.
In addition to leasing the streets Morgan talked about the possibility of leasing the airport! WHAT A SCAMMER!
What was just as revealing was after the snake oil consultants left the meeting. Dowell went into the June and August financial statements. (What happened to July?) The city’s cash flow is up OVER $30 MILLION from last year resulting in an $8.8 million surplus! (You would think with a 30 million increase in cash flow the surplus would be even more.) And it sounds like these numbers will probably increase over the next few months. It turns out that despite the doom we were told the COVID crisis would have on the City’s finance, the crisis has generated a huge windfall for the City, similar to the Camp Fire situation.
Naturally, they didn’t even think of giving any of the surplus back to the taxpayers or using it to fix the streets. They are pigs at the trough and will take everything they can get, so even with millions in surplus you can bet they will be talking tax and fee increases next year! It just shows that no matter how much money they take, all of it and more will be devoured by pensions, other post employment benefits and raises. These people are parasites and they will bleed the people of this community dry! DON’T LET THEM DO THIS TO YOU!
And thanks Dave, for bringing up that $30 million “surplus”. What happened to that? Slight of hand? Peas and walnut shells? That’s Business As Usual at the City of Chico!
We here in Chico have a big decision to make and we need to make it quick, before it’s made for us by a group of individuals who stand to gain substantially at our expense. If council approves the Pension Obligation Bond, it’s over Folks, we pay for the outrageous pensions at the expense of public infrastructure and services.
Four of our seven-member council are either public pensioners or married to public pensioners. All of their campaigns have been heavily influenced by public employee unions, who are the biggest contributors in every election. these PACs are allowed higher contributions limits than the average voter, and they can make contributions on their own and to other like-minded PACs.
I don’t believe people with such obvious conflict of interest should be allowed to make this kind of decision unfettered. At the very least, they should have to declare their personal interest in furthering the POB and continuing to prop up CalPERS, an agency they all know has put us in horrible debt through mismanagement. At the last finance committee meeting, both Sean Morgan and Andrew Coolidge acknowledged that CalPERS continues to make bad investments. So why won’t they ask employees to make more reasonable contributions? And why don’t they make any effort to get out of CalPERS and ask new employees to take a Defined Contribution Pension Plan?
The pension deficit is a burden that should be borne by employees who created it through unrealistic contributions, not the taxpayers.
This website is operated by a well-credentialed group of individuals, out of Chicago – a city with big pension problems. It is a really good source of information about pension systems nationwide, including the federal government systems, which have driven our national debt for years. Didn’t you ever wonder how this nation could end up with such astronomical debt?
They are featuring the post I made the other day about the city of Irvine, California, and Defined Contribution Pension Plans. So, I must be onto something, these people are all financial big-shots. I don’t think they’d run it if I were shooting blanks at the moon.
We here in Chico, and all over California, have a big decision to make and we need to make it quick, before it’s made for us by a group of individuals who stand to gain substantially at our expense. If council approves the Pension Obligation Bond, it’s over Folks, we pay for these outrageous pensions. Why would Staffers who make enormous salaries care about our hardships – they want the fucking money.
Do you know how many members of council are either public pensioners or are married to pensioners? Andrew Coolidge’s wife teaches at Chico State. Sean Morgan is also employed by Chico State, as is Alex Brown. Kami Denlay (married name, Klingbeil) is married to a public safety worker.
And then there are the contributions from public employee unions – Deepika Tandon in the latest election and Kasey Reynolds in 2018 both received their biggest contributions from the unions. I’m not sure about Huber, but he’s already expressed his desire to add more taxes to your bills with as little public participation as possible.
I don’t believe people with such obvious conflict of interest should be allowed to make these kind of decisions. At the very least, they should have to declare their personal interest in furthering the POB and continuing to prop up CalPERS, an agency they all know has put us in horrible debt through mismanagement. At the last finance committee meeting, both Sean Morgan and Andrew Coolidge acknowledged that CalPERS continues to make bad investments. So you have to ask yourself why they won’t ask employees to come to the table with more reasonable contributions. And why they don’t make any effort to get out of CalPERS and ask new employees to take a Defined Contribution Pension Plan.
The main reason is that the voters don’t make it a very important issue. That’s probably because most people have no idea what’s going on. You can blame COVID, but I’d say, the public is very poorly educated as it is, and Staff does everything they can to obfuscate the issue. I’d bet my last $5 that most council members barely understand what they are doing, they are following Mark Orme into the swamp. As long as they have their fingers in each other’s belt loops, they will make it out okay.
But Chico is sinking, look around yourself. And then look at the city budget, millions of dollars that should be spent on streets and other infrastructure going to the Unfunded Actuarial Liability – their obscure term for the pension deficit. And then look at your property tax bill – if you’re a renter, ask your landlord about it.
I think there’s a letter to the editor here, I’ll have to work on it. You too.
Last time we discussed a Defined Contribution Pension Plan offered by the city of Irvine California. The city of Chico uses a Defined Benefits Pension Plan. What’s the difference? Plenty. Here’s a good read from Investopedia:
The operative words here are “Benefits” and “Contribution”. Defined benefits means, whether or not business is good, the employee gets the pension they were promised. ” Defined-benefit plans provide eligible employees guaranteed income for life when they retire. Employers guarantee a specific retirement benefit amount for each participant that is based on factors such as the employee’s salary and years of service. “
In California, the state retirement systems made “guarantees” they couldn’t keep – 70 – 90% of highest years’ pay with minimal to no contribution from the employee. ” Employees are not expected to contribute to the plan, and they do not have individual accounts. Their right is not to an account, but to a stream of payments.”
In the beginning, CalPERS even told employers they didn’t have to contribute much of anything – CalPERS said they would make wise investments, and that would pay for these crazy pensions. That didn’t work out, so the employers – cities, counties, and public agencies all over the state – are on the hook for the pensions. And they are turning to the taxpayers like Mack the Knife. See, the contribution was never defined in this plan, so it’s whatever CalPERS demands. Like a junky on the street corner, they want it NOW!
On the other hand, the most common kind of Defined Contribution Pension Plan is a 401K. “Defined-contribution plans are funded primarily by the employee. But many employers make matching contributions to a certain amount .”
In Irvine, the city put up a little over 12% of salary. The employee is allowed to contribute whatever they want, and to control the investments. An interesting notation in that agreement is that the employee must wait 5 years before they are “100% vested” in the plan, meaning, they don’t get a full pension until they’ve proven to be a good and loyal employee.
And a DCPP is less risk for the employer. “As the employer has no obligation toward the account’s performance after the funds are deposited, these plans require little work, are low risk to the employer, and cost less to administer. The employee is responsible for making the contributions and choosing investments offered by the plan. Contributions are typically invested in select mutual funds, which contain a basket of stocks or securities, and money market funds, but the investment menu can also include annuities and individual stocks.“
Both set-ups are risky for the employee. If CalPERS fails, and that’s looking more likely all the time, pensioners GET NOTHING. With a DCPP, the employee makes their own investments, if they aren’t market savvy, they stand to lose there too. But, given CalPERS’ track record, I can see where an employee would be wise to opt for a DCPP.
Why hasn’t the city of Chico (or the county of Butte, or any of the local gov agencies…) offered a DCPP? I think that’s a no brainer. The DBPP is more lucrative, as long as they can keep propping up the failing CalPERS. The most popular form of prop these days is the Pension Obligation Bond.
It’s time for The Discussion about who will pay for these outrageous pensions. Will the employees step up to the plate and do the right thing, or will council allow Staff to force the taxpayers to the wheel with new debt and higher taxes?
Joe Azzarito is a retired accountant who lives in Chico. Here’s a letter he recently sent to the city of Chico regarding the Tax-a-rama council has embarked upon since a “conservative” Super Majority took over in January. Thanks Joe, I hope this email inspires other people to express their outrage with this obvious ploy to leave the taxpayers holding the Pension Deficit Bag.
To all Chico city councilors and Senior City Staff:
The topics of municipal revenue enhancements, namely a sales tax increase and pension obligation bonds keep surfacing in the course of discourse and analysis by concerned citizens such as myself.
Now why would that be? Could it be that you all are not listening to your constituents demands that these disastrously wrong ill conceived options, for funding the massive unfunded pension obligations that this city has forced upon its citizens, be abandoned? Whenever I read or hear about these plans of enduring us to untold costs to fund city staff’s, be they unionized or not, exorbitant salaries and pensions, it makes my blood boil. Your dark of the night surreptitious intents, without transparency, to enact either of these programs is a dereliction of duty, maybe not to your sponsors, the unions, or your fellow colleagues, but certainly to your constituents – the people that pay your salary through taxes.
I have heard that programs such as these can be implemented, without the consent of the voters. How dare you! It is not enough to seek input from us but for us to approve of these wild schemes fraught with danger. Given that the ruling class of Chico earns far and away much more than the median income of the people of Chico, you have the gall to push these down our throats.
For those on the council, recently elected and those previously, you are not conservatives, in the slightest sense fiscally. You all seem to some how, symbiotically, look after each other’s tail. Unions give you campaign funds so that you can win elected office. In turn, you fulfill their needs by ensuring their members are well paid. Wherein do the citizens fit into your scenario? Oh, yes, we are to fill the city coffers with the funds you promised your benefactors. Our needs lay at the bottom of a very deep hole, somehow they are only minimally attended to. It shouldn’t be that way! We should come first as it is our sweat and toil that makes it all possible.
I have spoken many times of the badly written about California Rule that keeps you from “doing the right thing” – that being to serve notice to all city employees that as of a determinable date they will be paying the full cost of their “silver spoon” pensions and that salary structures must be revised, downward, to allow the city to adequately meets its obligations to its citizens, first. Promises, previously made in prior eras when economic conditions were much more rosier than now, need to be upended. It would necessitate that pay scales, merit raises, benefits, including pensions, be approved by a body, inclusive of a citizenry board, and not by the likes of City Manager, his staff and/or City Council. To keep the decision making in their hands alone is why these financial problems came about in the first place. Those that pay the salaries should be the ones deciding, not so now. To have city staff analyzing, recommending and being on the receiving end of the decisions made is tantamount to “conflict of interest.
At the very least a referendum should be devised and agreed to by vote of the electorate on all of the above. The unfunded elephant in the room must be sequestered and controlled. CALPERS should be informed of any changes and any separations be established. The pensions of all covered city employees would need to be renegotiated, with the stipulation that staff would be paying the full load of costs. Any conflict with current law needs to be assessed and corrected. It is high time that city pay the piper his due!
This rent control ordinance is being shuffled through as part of a total overhaul of city business license fees and a new “business tax”. This meeting is only available to the public via Zoom. Committee members – sean.morgan@chicoca.gov andrew.coolidge@chicoca.gov and scott.huber@chicoca.gov
A rental registration program provides the City an opportunity to track and maintain rental property compliance separate to, or in conjunction with, business license requirements. HdL offers a wide variety of services designed to assist cities with managing varying aspects of property oversight. These range from implementing and managing a simple registration and information gathering program, to a more detailed rental program that tracks compliance with rent stabilization ordinances and the intricate requirements that go hand in hand with tracking compliance with local or state law.
Option 1 – Basic Rental Registration – tracks top level rental information on a per property/address basis and includes initial identification and education. An $18 fee would be collected per property/landlord account as well as summary information used for basic inventory of rental properties, inspection tracking, and a first step to more detailed reporting. Under this option the City would receive an estimated $81,000 of registration revenue. For each subsequent period, a fee of $15 plus Consumer Price Index adjustment would be collected per account amounting to an estimated $67,500 annually.
Option 1 (Add on) – Detailed Rental Registration – dives deeper to tracking on a unit level. This option gives the City the ability to collect information such as unit amenities, tenants, rent collected, or any number of unique data elements. An additional fee of $3 per unit would provide an estimated $21,000 of registration revenue. If the City chooses to mandate online filing, the $3 fee can be waived. This option is set to enforce multiple aspects of regulation including stabilization requirements, inspections, tenant complaints, and a more detailed housing inventory data analysis program.
Option 2 – Full Rental Compliance Program – is a turn-key program in which HdL monitors and enforces unit level regulations, responds to tenant complaints, and performs unit inspections for compliance. Each unit requires its own account to track individual units with the unit’s tenant, enforcement of rent increase, amenity offerings, and other ordinance requirements. A registration fee of $20 per account along with a $50 inspection fee would be collected to fund the compliance program. Total estimated amount generated under Option 2 would be $490,000 in compliance revenue. Rental registration/compliance programs are administrative fee-based programs that run independently of business licensing. However, a City’s residential property business license can rely on the completion of rental registration/compliance. Massage Therapist and Contractors are two examples of businesses that require compliance with more than one program in order to conduct business in the City.
Finally, this action can be passed without going to vote. If the City chooses, it could initiate a rental registration/compliance program in preparation of expanding the business license tax to include all residential rentals properties.
Thanks Dave, for writing a letter to the editor about the Pension Obligation Bonds the city is considering.
No, there are no “conservatives” on council – maybe they’re “conservative” with their own money, but they treat the collective pot like a big cookie jar. They rode into office on money from public employee unions, and now they are trying to pay back their benefactors by roping the taxpayers into paying for the overgenerous pensions and “post employment benefits“.
Here’s Dave’s letter – take his example, and start writing your own letters and emails folks.
Conservatives are supposed to stand for low taxes and fiscal responsibility. We are told we now have a conservative majority on the city council. But what we actually have is a council of impostors. They plan to use the revenue from their proposed sales tax increase to take on hundreds of millions in new debt. They also plan to take on an additional hundreds of millions in new debt in the form of a pension obligation bond. It’s a dangerous gamble. And on the off chance it pays off, it WON’T make the pensions sustainable. And if it doesn’t pay off it could bankrupt the city.
Combined pension and other post employment benefit liabilities plus interest are over a quarter billion dollars and growing. It can never be paid. But our local politicians will raise our taxes and bury us in debt to keep the gravy train rolling a few more election cycles. After all, bureaucrats and other city employees must continue to receive unaffordable compensation packages, including multi-million dollar pensions. And this in a county with a 21% poverty rate BEFORE COVID. It’s unconscionable, especially at a time when so many businesses and working people struggle to make ends meet. But it is to be expected when our local politicians are tools of special interests.
These politicians don’t represent hard working taxpayers and never will. Voters should remember this in the next election and defeat the sales tax increase and those council members responsible for it.
Dave Howell, Chico
No, these people DON’T represent the average Chico resident, they represent the public employee unions. It’s time to start thinking about replacements. Kasey Reynolds, Scott Huber and Alex Brown are out in 2022, let’s find some decent hardworking taxpayers to fill their seats. Reynolds is the worst kind of faker, running as a “conservative” and then bringing in not one, not two, but THREE TAX MEASURES. And Huber and Brown pose as protectors of the poor – BULLSHIT people! At a time like this, they want to raise taxes? Tell them HELL NO!
These people are all beholden to the union PACs. The employee unions are the worst kind of communist plot – the enrichment of the few, paid for by the many. Don’t fall for it, demand council bring employees back to the table to pay more of their own benefits, or throw these IMPOSTERS to the curb in 2022 and 2024.
The worst thing about Pension Obligation Bonds is that the proceeds would be gambled on the stock market. The assumption is that the investments would pay both the bond service and the pension deficit. How nuts is that?
I’ve heard various analogies – taking a credit card to the casino, taking a second mortgage on your house to pay the first mortgage, paying your credit card with your other credit card, etc. Of course people do all these things, and we’ve seen what happens to them. We’ve watched neighbors, friends, even family members lose it all in gambits like that, and we’ve shaken our heads and wondered how they could be so stupid. How is it suddenly prudent just because it’s a government agency doing the dumb thing?
They will tell us they know what they’re doing, just like CalPERS told the governor and all the state agencies that they knew what they were doing. They don’t.
The consultant who pitched this horror story in the making to the Chico City Council said the key would be to borrow the bond money at a rate of 3 – 4% interest. He speculated that money would make a good enough return on the market to pay that rate, and then some for the pension fund. But he made it clear, constantly, that a “downturn” in the market would be a very bad thing – then the city would owe both the bond money and the pension payments, both with interest.
The difference between those two debts, as reported by the consultant, is that CalPERS won’t dump us for not being able to make our full payments, our “obligation”. As long as we pay SOMETHING, they will keep on paying out the crazy pension payments. In fact, each agency negotiates their own deal with CalPERS and sets the employee contributions. Of course, if they don’t pay enough, the debt grows, with interest – that creates the Unfunded Actuarial Liability, or, the “pension deficit”.
On the other hand, a Pension Obligation Bond has to be paid, in regular installments, or the bond holders can demand either the back payments or the entire debt, on the spot. This means, they could empty the General Fund, and every other fund the city holds, except the Pension Stabilization Trust. The PST is the only truly, legally restricted fund the city has established. All other funds, from the streets fund to the park fund to the sewer fund and on, are available for allocation to the General Fund.
The proponents keep trying to tell us this is a fool proof scheme. They won’t acknowledge the fact that the market can turn ugly on a dime. Really ugly. Pension systems around the country are making some really desperate, stupid investments, according to this article from the Reason Foundation.
In the United States, public pension funds, which have an average investment return target of 7.25 percent, will likely struggle to meet those investment targets and could be severely impacted by plummeting interest rates. Without changes to pension plans’ assumed rates of return, many public pension systems will see an increase in debt.
Unfortunately, many public pension plan managers are not interested in adjusting their investment return targets to realistic levels at this time. Instead, they are seeking riskier, potentially higher-yielding investments in an effort to make up for depressed interest rates and hit their targets.
What’s super frustrating is the double talk. Our mayor, Andrew Coolidge, acknowledges that CalPERS is doing horribly, but tries to assure us that our staff can pull of successful investments. In this market?
According to this article, government agencies’ share of the UAL is about to go up again, due to risky investments. For example, “New Mexico’s Educational Retirement Board (ERB), which serves the state’s teachers, is one such plan that dedicates roughly a quarter of its portfolio to fixed-income assets. Within New Mexico ERB’s fixed income-investment allocation, 7 percent of funds go to emerging market debt, which is essentially sovereign bonds issued by countries classified by the World Bank as lower-to-middle-income to upper-middle-income. This includes countries such as Brazil, India, and Nigeria.”
“Even though emerging market debt carries much higher yields that are attractive to pension funds, those benefits can be outweighed by enormous risks since several of these countries have defaulted on their debt in the past. Due to this risk, public pension investment allocations to emerging market debt have historically been used sparingly in pension fund portfolios. However, in recent months, pension fund managers have signaled a growing appetite for allocating more assets to this asset class.”
As more pension funds take on these risky investments, more will fail, debt will increase, and be passed on to government agencies. In California, CalPERS has a horrible record of corruption, with various board members leaving in disgrace over manipulating the public trust to their own gain. Most recently an investments advisor left after he was found to be using CalPERS funds to buy stock in funds he owned. CalPERS is also floundering under huge board member salaries – here’s a thought – CalPERS has it’s own pension deficit.
Instead of screaming for investigations and reform, I think those public employees who stand to get pensions are getting desperate to make sure the pension systems are funded. I just can’t decide whether our council members are being led by the nose or if they are coming to the table knowing exactly what they are doing.
Chico Taxpayers Association 