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San Diego City Employees pension fund ailing
Don in responding to your comment #1172. Yes I did say bankruptcy. The Vallejo case may set a precedent that others may follow. But Jerry has made it clear on several occasions he will NOT take the city into bankruptcy. Well, not under his watch. (Looks bad for those with aspirations for higher office, especially after getting a little taste of power.) So, unless something dramatic happens that will probably be up to the next Mayor who'll say they inherited the problem from the previous administration(s)... sounds eerily familiar now-a-days. With that said, and understanding the law as I pointed out in comments 1167 & 1168 above, the courts don't like to mess with pension benefits. Of course, we are not blinded by the fact that judges are public servants too. Nevertheless, if we examine the outcome of the Orange County bankruptcy the courts DID NOT ALLOW the County to discharge its negotiated pension obligations. Promises that may not be taken away or even reduced, unless it is replaced by a benefit of equal or greater value. The California Supreme Court stated the applicable principles almost 30 years ago.— March 25, 2009 10:50 a.m.
San Diego City Employees pension fund ailing
Well Johnny, loosing 300 BILLION in "Corporate America" [where they don't]have the DB pension plan[s] anymore..." according to you seems like a lot of money to me. Heck with mere 1% of it EVEN YOU could buy your way into the Mayor's office and wreck havoc on the lowly municipal employees.— March 25, 2009 10:31 a.m.
San Diego City Employees pension fund ailing
I see corporate America's DB plans are suffering just like the rest... The steep drop in the markets in 2008 wiped out five years of gains in the pension plans of the 100 largest corporate defined benefit (DB) plan sponsors, Milliman research reveals. The consultant’s 9th Annual Milliman pension funding status report reported the 100 largest DB plans lost a combined $300bn – and noted funding statuses also took a beating into 2009.— March 25, 2009 7:22 a.m.
San Diego City Employees pension fund ailing
As for Johnny wanting to be Mayor...Hervé Jean-Pierre Villechaize and his boss Mr. Roarke put it well...Welcome to Fantasy Island... But on Fantasy Island, Mr. Roarke's guest prepaid for their fantasies... Johnny just likes to stir blog pots all over California with his one-trick pony solutions.— March 24, 2009 7:38 p.m.
San Diego City Employees pension fund ailing
As the Supreme Court stated 60 years ago in Kern v. City of Long Beach (1947) 29 Cal.2d 848, 853: “Although there may be no right to tenure, public employment gives rise to certain obligations which are protected by the contract clause of the Constitution, including the right to the payment of salary which has been earned. Since a pension right is ‘an integral portion of contemplated compensation’ [citation], it cannot be destroyed once it has vested, without impairing a contractual obligation.”— March 24, 2009 7:32 p.m.
San Diego City Employees pension fund ailing
Don DROP has been dropped for all of the new hires since either July 2007 or March 2007 depending on who you want to believe. (Mr. Aguirre or the law). How, other than bankruptcy, would you end DROP for the others. I suspect you believe in the rule of law? Since DROP is a vested benefit. The law is clear in California that a vested retirement benefit may not be taken away or even reduced, unless it is replaced by a benefit of equal or greater value. The California Supreme Court stated the applicable principles almost 30 years ago in Betts v. Board of Administration (1978) 21 Cal.3d 859, as follows: “[T]here is a strict limitation on the conditions which may modify the pension system in effect during employment. We have described the applicable principles as follows: ‘An employee’s vested contractual pension rights may be modified prior to retirement for the purpose of keeping a pension system flexible to permit adjustments in accord with changing conditions and at the same time maintain the integrity of the system. [Citations.] Such modifications must be reasonable, and it is for the courts to determine upon the facts of each case what constitutes a permissible change. To be sustained as reasonable, alterations of employees’ pension rights must bear some material relation to the theory of a pension system and its successful operation, and changes in a pension plan which result in disadvantage to employees should be accompanied by comparable new advantages. [Citations]. …’ (Emphasis in original). “…. “Judicial attention has also been given to the subject of ‘comparable new advantages.’ The comparative analysis of disadvantages and compensating advantages must focus on the particular employee whose vested pension rights are involved. [Citations.] It has been said that the offsetting improvement must also ‘relate generally to the benefit that has been diminished.’” Id. at 864-865. Just as in Betts, if the City were to repeal DROP after it became a permanent and vested benefit, it would violate the above-stated principles of law unless the DROP program were replaced by a program providing comparable new advantages. The repeal of DROP would be unlawful because of the strict limitation on the conditions which may modify the pension system in effect during employment. Rights of both retirees and active employees, who have relied on the DROP program as a vested retirement benefit, would be violated. And that is true whether or not an active employee entitled to DROP has already enrolled in the program.— March 24, 2009 7:32 p.m.
Two Nobel Economists Denounce Geithner Plan for Lining Wall Street Pockets
According to Johnny...everyones going, Sanders going, Dumanis is going, Judges are going etc etc, ...but no one has left.... Don't you tire of these end predictions Mr. Vegas-Surfpuppy619— March 24, 2009 7:20 p.m.
Theory of Relativity
Did National City do that John?— March 24, 2009 7:16 p.m.
San Diego City Employees’ Retirement System overestimates annual pension returns
Bean counters and "fiscal conservatives" have turned us into balance sheet fanatics. Tax collections are down. California is struggling. Yet many want us to shore up the balance sheet of the government pension plans. You've cited our local, San Diego Systems. They should only be helped if they have a liquidity crisis and cannot pay their current obligations. I believe we're a long ways from that situation. However, if our government employee systems continue their fast and loose investment strategies with their investments, then funding formulas need to be changed. They'll needs to be something based on long-term return on investments, not the feast and famine formulas now used. Some believe the accounting industry in the private sector worships the earnings statement, turning the balance sheet into a useless "plug." In government, the accounting industry has become balance sheet zealots. Governments do not even need balance sheets, BUT should CERTAINLY take into account the "people's" ability to fund services they want at a reasonable cost and NOT pass those costs on to future generations! Balance sheets are relevant if there is a chance the entity will be liquidated. Balance sheets make sense, for the non-government part of our economy, but they've been decimated by deference to the earnings statement. Most business balance sheets do not come close to presenting economic reality. Governments, on the other hand are perpetual entities, and as we experienced with Orange County, they exist after bankruptcy too. Are balance sheets worthless? Two things matter in government finance - liquidity (cash flow) and stewardship, the spending of tax dollars properly. It is the latter that has been the overarching problem in our culture. In my opinion, if we manage to get our voracious spending habits under control the rest will fix itself.— March 20, 2009 10:25 a.m.
U-T Heads Will Be Chopped More Severely; Economics Dictates It
Response to #4.... I was thinking the EXACT same thing!— March 19, 2009 8:15 p.m.