BC asked, Why is it only the taxpayers are on the hook for the unfunded pension liability?
Good question, I wrote a letter about it!
After my last letter a friend asked, “Why is it only the taxpayers are on the hook for the unfunded pension liability?”
It’s in the contracts. Council agrees to the terms regarding salary and benefits. Council also approves the inadequate shares employees are paying toward their benefits, which has left the city wandering deeper and deeper into pension debt with CalPERS.
Year after year, Council approves the increasing annual payments toward the resulting pension deficit – $18 million in 2023 alone. Despite millions in “catch-up” payments, the deficit continues to rise, at last report, over $180 million.
And that’s how the taxpayers get left on the hook. How can we get off?
Elect council members who will negotiate taxpayer-friendly contracts. Employees should shoulder their own pensions. Instead of allowing the pension deficit to “ride the market” down the road to Perdition, set up realistic defined contributions from employees, based on the true cost of their pensions instead of Pollyanna market projections. The taxpayer (“employer”) contribution should be based on merit and length of service. Employees should be responsible for the losses as well as the gains.
Outsource jobs? The city culled positions in 2013, but here we are again. It’s the contracts.
Juanita Sumner, Chico CA
Chico Taxpayers Association 