Thursday, April 17, 2014
YOLO COUNTY NEWS
99 CENTS

CalPERS’ role was exaggerated

The recent editorial, “Fiscal crisis looms for our fine city,” published on Jan. 26 stated that the misguided polices by CalPERS made the city of Davis’ pension costs appear to be affordable.

This is an unjust exaggeration of CalPERS’ role concerning the city’s budget challenges. The city of Davis is similar to many other local governments in California that are facing difficult fiscal issues amid the worst economic recession in history.

CalPERS administers retirement plans, we do not determine the pay and benefits of city employees. These decisions are made by city officials in consultation with city employees. Our job is to ensure that the retirement benefits promised to city employees are properly funded.

Major pension reform measures were enacted under Gov. Jerry Brown through the Pension Reform Act of 2013 that will help local governments like the city of Davis and the state manage their pension obligations. Local governments face myriad economic challenges as the nation recovers from a fiscal crisis and pension obligations are just one piece of a large puzzle that need thoughtful examination by city managers.

Robert Udall Glazier

Deputy executive officer, Office of Public Affairs, CalPERS, Sacramento

Letters to the Editor

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  • Paul BradyJanuary 31, 2014 - 10:56 pm

    This letter from CalPERS PR man Glazier is distorted self-serving nonsense. The Davis Enterprise editorial "Fiscal crisis looms for our fine city" was a soft-ball criticism of misguided Cal PERS policies which have have caused havoc in many, if not most, California cities, counties and other public agencies! In 1998/99 CalPERS [in concert with its public employee unions] assured the Legislature that it could fund huge public employee pension and other benefit increases - as much as 50% in pensions. The 3%/year pension at 50 years of age for "safety employees such as fire, police, prison guards, Calfire, etc., resulted. But CalPERS has been unable to achieve the required investment returns, so the State, cities counties via their taxpayers had to make up the differences, costing billions per year. This has devastated the finances of city, county, and other public agencies who quickly or eventually, adopted the enhanced State benefit formulas! And it is now decimating Davis city services. Our Community Pools complex was to be closed, had it not been taken over by the Davis Aquadarts, a community age-group swim club who will pay for its operation and maintenance. The corruption, greed and million-dollar kickbacks to CalPERS employees, or at least to its Board members, has been exposed in the Sacramento Bee. CalPERS has gotten involved and been ripped-off by private-equity investment houses, lost billions in ill-advised real estate investments and just failed in its other investments, thus costing taxpayer tens of billions and producing huge employee costs for employers [taxpayers]. The unfunded liabilities of CalPERS are estimated to be at least several hundred billion dollars. The market, eg, Dow Jones Index [DJIA index], has averaged 12.3% per year over the past 30+ years. CalPERS has done what: 8%/yr ? Over 33 years a million would grow to 46 million in the DJIA index vs 12.7 million for CalPERS. CalPERS incompetence is costing state taxpayers hundreds of billions! Annual costs for each employee are rising rapidly. Our Davis city manager recently gave us some numbers: retiree pension and healthcare costs rising to 50, 60, 70, as much as 80% of employee salaries! If nothing more is done we will be a shell of the City we are now! What Havoc CalPERS and our dysfunctional Legislature has wreaked on us!

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  • Elaine Roberts MusserFebruary 02, 2014 - 10:54 am

    I notice you state that misguided polices by CalPERS making the city of Davis’ pension costs appear to be affordable is an unjust exaggeration of CalPERS’ role concerning the city’s budget challenges. So I assume you do not deny that misguided CalPERS policies did contribute to making the city of Davis' pension costs appear to be affordable when in fact they were not. I would agree there is plenty of blame to go around, but certainly CalPERS misguided policies should share in that blame, no?

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