Stampede: a mass movement of people at a common impulse.
– Merriam Webster dictionary
The pension reform stampede is about to finally overrun California’s political status-quo for three reasons.
(1) Pension debt is out of control. While official estimates are slightly lower, most reasonable estimates put California’s total unfunded liabilities for state and local pensions at around $500 billion.
(2) Required agency contributions are set to double. California’s two largest pension systems, CalPERS and CalSTRS, have both announced that within the next few years their participating agencies are going to have to at least double the amount they contribute to pensions.
(3) Active cases before the California Supreme Court, set to be decided within a year, will likely enable more meaningful pension reform measures at the state and local level.
Serious pension reform may soon become politically feasible, and it’s about time.
An indicator of how serious politicians are finally taking California’s pension crisis is exemplified by the California League of Cities Pension Project. A consensus is belatedly forming within this powerful organization that absent real reform, California’s public sector pensions are not financially sustainable.
CALIFORNIA’S PENSION REFORM ORGANIZATIONS
Here are some of the groups and individuals in California who are either providing vital information, or engaging in activist efforts for pension reform:
A good place to start is the pensions section of Transparent California, a five year old website that has compiled the most comprehensive database of individual state and local government compensation and pension information possibly in the U.S., and certainly in California. On Transparent California’s All Pensions page, users can search through millions of individual pensions. On its Pension Plans page, users can search for recipient information by pension system. On its Last Employer page, users can search for recipient information by the last employer.
At least four regional groups scattered across California focus exclusively on pension reform, or devote a considerable amount of their resources to the issue of pension reform. From north to south, they are: Citizens for Sustainable Pension Plans (Marin County), New Sonoma (Sonoma County), the Contra Costa County Taxpayers Association, and the Ventura County Taxpayers Association. There are undoubtedly other regional organizations that have done important pension reform work – any suggestions for additions to this list are welcome.
Three heroic individuals who have dedicated years of volunteer time to educating the public, the media, and policymakers about public sector pensions are John Dickerson, publisher of YourPublicMoney.com, Jack Dean, publisher of PensionTsunami.com, and Ed Mendel’s CalPensions.com. If you want to learn the intricacies of pension finance, what John Dickerson has created is as good a place as any. If you want a daily archive of links to every significant report on pensions in the U.S., Jack Dean’s meticulously curated Pension Tsunami website is not only the best place to look, it’s the only place to find that information. Ed Mendel’s CalPensions offers deep analysis of pension developments in California.
Stanford University’s Institute for Policy Research issues regular assessments of California’s pension challenges including the recent Pension Math: Public Pension Spending and Service Crowd Out in California, 2003-2030, October 2017, and California Pension Tracker 2.0, an interactive database that reveals, among other things, by city or county, the total market pension debt per household. The Los Angeles based Reason Foundation presents ongoing analysis of the impact of pensions on the Pension Reform section of their website.
State-focused and national activist organizations in California include the Sacramento based Retirement Security Initiative, which is active in states across the U.S. fighting for pension reform, and the San Diego based Reform California, working for pension reform at the state level.
For continuing dialog with pension reformers the Facebook communities created by the Citizens for Sustainable Pension Plans and Californians for Pension Reform are both very good. The California Policy Center also has a Facebook page that includes extensive coverage of pensions, along with esposes of the most powerful special interest that opposes pension reform, government unions.
For years the California Policy Center has followed the pension crisis in California, and over the past few months has released several reports that, in aggregate, provide a reasonably complete summary of the challenges Californians face to get public employee pension costs under control.
Those reports, with titles that explain the specific topics, are the following: The Underrecognized, Undervalued, Underpaid, Unfunded Pension Liabilities, March 2018 – How to Restore Financial Sustainability to Public Pensions, February 2018 – How to Assess Impact of a Market Correction on Pension Payments, February 2018 – California Government Pension Contributions Required to Double by 2024 – Best Case, January 2018 – Did CalPERS Use Accounting “Gimmicks” to Enable Financially Unsustainable Pensions?, January 2018 – How Much More Will Cities and Counties Pay CalPERS?, January 2018 – If You Think the Bull Market Rescued Pensions, Think Again, December 2017 – Did CalPERS Fail to Disclose Costs of Historic Bump in Pension Benefits?, October 2017 – Coping With the Pension Albatross, October 2017 – and How Fraudulently Low “Normal Contributions” Wreak Havoc on Civic Finances, September 2017.
On the website for the California Policy Center’s “CLEO” (California Local Elected Officials) project, additional policy briefs are available to assist pension reformers, including: Graphics to Explain the Pension Crisis to Colleagues and Constituents, December 2017 – Explaining the Pension Crisis – Additional Graphics, December 2017 – Pension Questions To Ask Your Agency’s CFO, Actuary & Auditor, December 2017 – Did Your Agency Comply with the Law When Increasing Pension Formulas? – October 2017 – Pension Reform – The San Jose Model, September 2017 – and Pension Reform – The San Diego Model, August 2017.
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