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Forum on Public Pensions Next Week in OC

The Orange County Division of the League of Cities is holding a forum on "Understanding the Benefits and Challenges to California’s Public Pension System" next Thursday (the 12th) in Costa Mesa.  There's a pretty solid lineup, not the least of which is the moderator -- CityNews' own Robb Korinke! 

• Reed Royalty, President, Orange County Taxpayers’ Association
• Bruce Channing, City Manager,City of Laguna Hills
• Ron Cottingham, President, Peace Officers Research Association of California (PORAC)
• Marcia Fritz, President,California Foundation for Fiscal Reform
• Brad Pacheco, Assistant Division Chief,California Public Employees Retirement System (CalPERS)

If you're in the neighborhood, register to attend.

New Options Coming Online for Retiree Health

CalPERS just got a little healthy competition, from San Bernardino County.  New state legislation allows San Bernardino County's retirement system to market an alternative to a two-year-old CalPERS retiree health fund.

Writes Ed Mendel:

"So, what does a comparatively small 30,000-member system, with about $5 billion in assets, have to offer that can’t be provided by a giant 1.6 million-member system, with $197 billion in assets, the nation’s largest?"

"The San Bernardino system said smaller can be a good thing: lower overhead, leaner, with an opportunity to be more efficient and responsive. Previously, local governments only had two choices for their investments: CalPERS or Wall Street."

Read more from Mendel at CalPensions.

LA Loses 6th Pension Exec in as Many Months, New Legislation to Blame?

Eric Holoman, the president of LA's largest public pension system, resigned last week, and is the 6th such executive to do so in as many months.  This is leaving LA's underfunded pension systems in crisis mode, and new legislation designed to prevent "pay-to-play" scenarios may be the root cause of it all.

The Governor signed a new law this session which places strict limits on the private investment activities of those in charge of public pensions.  Many of the restrictions seem to make sense on their face, but taken together with some of the more strict measures, we may be looking at yet another barrier to getting bright, motivated individuals into public service.

Read more in the LA Times.

Wall St Journal Sees Pain for Cities in CalPERS Losses

With a $50 billion loss in the last fiscal year, the Wall St Journal is reporting, correctly we're afraid, that much of the burden to back filling the fund will fall to cities.  "The bottom line from my point of view is that just about the time we will start to see a recovery in 2011, we are going to have this huge additional cost," Fullerton City Manager Chris Meyer told the Journal.

Ugh.  There's also the pesky issue of a former board member earning $50 million securing investments from CalPERS as a "placement agent."  Not that's a revolving door.  Read more on that little piece of business from the SacBee or read the WSJ piece here.

Guv Signs and Vetoes

The Governor relented on his mass veto threat this weekend.  Citing progress on water negotiations, Schwarzenegger got the pen out and started signing on the dotted line. 

His total for the session stands at 632 new laws approved this session -- which sounds like a lot until you hear it makes him the "stingiest" Governor for signing bills in recent history.  His signing totals have declined in each of the last four years, but he's still not the Veto King -- that still belongs to Deukmejian, who axed 436 bills in 1990. 

Most importantly, if you wanna know what wasn't on the list of bills for the Governor to consider -- Prop 1A securitization and HUTA clean up language.  It's alleged that the Senate is coming back to finish up that piece of business this week.  

And back to the raw numbers of bills, for those of you wishing for a bygone era in which the legislature was less concerned with passing hundreds of bills, Dan Walters reminds us that in 1967, Reagns first year as Governor, the legislature passed over 1,700 bills, and the Guv vetoed just 83 of them.

Get a full list of the signed/vetoed bills here.  LA Times has a good rundown of the major legislation here.

San Jose Doc Questions Cop, Firefighter Disability Claims

A city doctor in San Jose is gaining some notoriety as "Dr. No," largely for his conservative look at public safety workers' disability claims.  Dr. Rajiv Das "a board-certified specialist in occupational, pain and rehabilitative medicine who took the job in 2005, admits he's "a hardliner" who demands medical evidence to support a disability claim. But he insists he's fair and simply wants documentation before agreeing that an employee has limited capacity to do the job."

Now some officers would just as soon "Dr. No" move on to another line of work.  He has his backers on the council though, and even among the ranks of some public safety officials.  This could be  owing to an earlier Mercury News analysis of the city's 1,200 public safety retirees found "52 percent of former San Jose officers and 77 of firefighters were receiving disability pensions — rates that dwarfed those in nearby towns and other big California cities."

Read more.

SEIU Goes for Trifecta on CalPERS Board

Ed Mendel of CalPensions has a great look at the upcoming CalPERS board elections -- which are always hotly contested and thoroughly funded.  Mendel takes a look at how the SEIU has successfully backed recent candidates for the board, and is looking to make it three in a row.

Writes Mendel: "But if a candidate with Jelincic’s record of labor leadership and strong backing from other labor groups is defeated, the SEIU may cement its position as one of the most powerful forces in future board races, if not a kingmaker."

Read more at CalPensions.

CalPERS Responds to NYT Allegations of "Risky" Bets

In his CalPension blog, Ed Mendel takes a look at recent New York Times piece alleging CalPERS plans a set of potentially high-risk investments” to recover historic losses to its largest-in-the-nation retirement fund.

The new Chief Investment Officer for CalPERS, Joseph Dear, wrote the PERS board last week saying its recent actions "despite the popular characterization of it, was to slightly reduce the risk and the return of the portfolio."

See the original NYT story here, or to get the fallout and reactions, go straight to CalPensions. 

Defined Contribution Arrives in La Mesa

A big development in San Diego County, as city employees in La Mesa agreed to begin kicking in 8 percent of their salaries towards their own pensions.  They were given half that amount back in salary increases, but the change is set to save the city up to $1 million a year, and establishes a milestone in the contributions themselves.

As Ed Mendel writes in his CalPensions blog, the "cities in the county had a front-row seat for the pension scandal in San Diego," and a working group of city managers decided to do something about it.

Read more, it's about your future.  Also worth a read is a Daily Bulletin piece outlining the battle lines surrounding public pensions. 

CalPERS Chief Actuary Calls Pensions "Unsustainable"

Sustainability -- it ain't just for enviros anymore.  CalPERS Chief Actuary Ron Seeling called current pension costs for state and local governments "unsustainable," and PERS is planning a stakeholder meeting to discuss the future.  Seeling has also said that we, as a state, "have got find some new solutions," and discussed the immediate future for local government rate increases:

"Instead of a rate increase of 4 to 20 percent of pay, the smoothing will reduce the rate hike to a more manageable 0.5 to 2 percent of pay. "

Read more in the Cap Weekly.