Supervisor Janice Rutherford
Point of View
Supervisor Janice Rutherford
Created: 07/19/2012 11:50:12 AM PDT
You, your spouse and your children owe roughly $1,000 each to cover the unfunded pension liabilities of San Bernardino County employees. And, if reform doesn’t come soon, that growing tab could cripple our economy for decades to come.
In the just-approved county budget, we are spending $375 million on pension obligations. This year we are spending $48.4 million more than last year. Just imagine what could be accomplished with those millions of dollars.
Even with this year’s increased payments, we still have $2.25 billion in unfunded pension liabilities, including payments on pension obligation bonds (i.e., money borrowed to keep the retirement system afloat).
That pension debt will crush our county’s ability to stay competitive when it comes to attracting businesses, and our children will be the ones who suffer most if we do not act now to restructure our pension system.
That’s because businesses – especially large ones that create hundreds of jobs – look at the long-term picture when they choose a location, and communities with mammoth pension liabilities and no plan to rein them in will eventually have to raise taxes or dramatically cut services or both to meet their obligations to retired employees.
Those debts might also help push local governments off the financial cliff and straight into bankruptcy court.
Some call pension reform a political ruse and argue that future investment gains will wash away the billions of dollars in liabilities that generous pension formulas have created over the years.
They might be right. Then again, they might be wrong.
As it stands, the pension system rests on the assumption that investment returns will average about 7.75 percent. But the county’s pension system has only produced an average 4.8 percent return over the past 10 years.
Who covers the difference when the fund doesn’t perform? Taxpayers. And the more taxpayers have to put into the public retirement system, the less is available to pay for the police and fire protection, roads, jails, landfills, parks, courts and other public services we need.
Some also argue that the average public retiree in our system only gets $2,700 a month – not the huge payouts making splashy headlines.
But think of it this way: A private company’s employee would need to save about $650,000 to get that same $2,700 a month.
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Great article Janice. Keep up the great work!
RE: “This year we are spending $48.4 million more than last year. Just imagine what could be accomplished with those millions of dollars.”
“Just imagine what could be accomplished” with the millions of dollars the county has spent on The Colonies lawsuit.
If it was not for the arrogance and defiance of former County Supervisor Jon Mikels, The Colonies would have PAID the County $12 Million. We all know what happened instead.
I am amazed at the lack of outrage over the amount of money this one bureaucrat has cost the County.
“I am amazed at the lack of outrage over the amount of money this one bureaucrat has cost the County.”
HE SHOULD LOSE HIS HOME, CAR, SAVINGS AND THE SHIRT OFF HIS BACK!
BETTER YET, HE SHOULD JUST MOVE OUT OF SBC!
Everybody should be more outraged over how much the county (Ramos)is blowing. Personally hope the colonies people sue the shit out of Ramos personally and the county, then maybe the Daily Bulletin rag. Hope that when they lose this time they do not continue to listen to people politically motivated to pursue something that won’t happen.