On December 5, Goldstone said he would attach a cover letter in the financial statements that will include the information. "SDCERS had illegally paid out benefits in excess of Section 415 limits from the pension plan, but at the time, the system was managed by people who have been terminated," said Goldstone. "Nevertheless, this was wrong. SDCERS' new management recognized the errors." He said the errors had a "small impact on the City's financial statements." Small?
The upshot: on December 7 the Union-Tribune wrote a silly story, moaning that Macias Gini & O'Connell was afraid Aguirre might sue it. This could impact the timing and costs of future audits. In both the story and a sillier editorial the next day, the newspaper heaped all the blame on Aguirre for insisting that the disclosure be correct. Does anyone remember that the SEC said last year that the City committed willful securities violations? It seems the message has already been forgotten by the City administration and its toady, the Union-Tribune.
But on December 13, Goldstone relented. He said he would open up the 2005 audit and include the information Aguirre and Frye wanted.