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Wednesday, June 06, 2012

CA Voted Too

Oddly enough, pensions were on some of the local ballots in CA:
Voters in two major California cities overwhelmingly approved cuts to retirement benefits for city workers in what supporters said was a mandate that may lead to similar ballot initiatives in other states and cities that are struggling with mounting pension obligations. ...

In San Diego, 66 percent voted in favor of Proposition B, while 34 percent were opposed. Nearly 97 percent of precincts were tallied by early Wednesday. The landslide was even bigger in San Jose, the nation's 10th-largest city. With all precincts counted, 70 percent were in favor of Measure B and 30 percent were opposed. 
There will now be lawsuits, but courts are more accepting of initiative-based cuts. Both of these measures affect current participants as well as future participants. 

One of the cities - I don't know whether it was San Jose, or San Diego, saw their pension costs rise from about $60 million a year in 1999 to more than $200 million, now.

It is high time these pensions were indexed to tax revenue growth.
San Jose is mainly high tech. They have the fairly nearby example of Vallejo, to remind them of what happens when pension costs get out of line.

It seems like there was a major scandal last year in the San Diego area? It was a mostly hispanic community, where the mayor and councilfolks were getting ridiculous amounts of money for benefits. Wish I could remember more details on it.
San Jose 73 million 2001 > 243 million 2011. San Diego 43 million 1999 > 231 million 2011.

Something's got to give. San Diego cut its workforce by about 14% and San Jose by about 27%, still you see those numbers.
I wonder if part of the problem in CA is making promises to city workers based on unrealistic population gains. Politicians saying "smart growth" in public and praying for sprawl in the back rooms.
A path to public pension reform: http://www.bayshoreteaparty.org/btpg-blog/2012/6/9/fiscal-responsibility-a-tea-party-cause.html
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