Montebello Pension Reform
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Reality check

United States

#1 May 22, 2011

SPECIAL REPORT: Public employee pension reform remains sticky issue
By Erick Galindo, Staff Writer
Posted: 05/21/2011 08:30:48 AM PDT

LOS ANGELES - Experts and government officials agree that California and local agencies drastically need to reform the public employee pension system.

Although the system appears beyond repair, there's some agreement on how to fix it - compromise through bargaining.

But, while experts look to local government for the solution, local electeds hope either Sacramento pols or voters at the ballot box provide the plan.

"We need to stop the bleeding, but there's no quick fix," said Bruce Channing, president-elect of the City's Managers Committee for the League of California Cities.

Ultimately, he said, "Reform needs to be done at the bargaining table."

Channing made the remarks at an event sponsored by the American Society for Public Administration and The Bedrosian Center on Governance and the Public Enterprise at USC.

At issue was a February report from the state's Little Hoover Commission, which called for state and local governments to freeze future pension benefits for current workers.

Ultimately any solution comes down to negotiation.

City and business leaders in the San Gabriel Valley and Whittier areas have mixed opinions over how to handle pension reform. Most, however, agree that it needs to happen at both the state level and at the bargaining table.

"Even if state laws were changed we would still have to go to the bargaining table," said Steven Preston, San Gabriel city manager.
"Pensions are largely contractual agreements and you would still have to go to the table to get an agreement on the changes."

Whittier Mayor Cathy Warner agreed with Preston saying that "reform should occur at both levels."
Get What U Deserve

Corona, CA

#3 May 23, 2011
There has to be a compromise. Public employees do deserve a retirement plan, but the plan cannot break the bank.
I would say a risk-scale system should be implemented. For instance, positions that are considered high risk such as police or fire should be a 50-50 scale with the state or city contributing one dollar for every dollar the employee contributes to his or her retirement. Lower risk positions such as clerk and maintenance could be scaled down to a 3-1 contribution, where the city or state would contribute 1 dollar for every 3 or 4 dollars the employee contributes.
Just a suggestion.
reality check

United States

#4 May 23, 2011
Good suggestions

did you see
Perhaps Montebello PD could implement
reality check

United States

#5 May 24, 2011
Trash talk

Reseda, CA

#6 May 25, 2011
In SGV Tribune yesterday

May 23, 9:53 PM EDT

Watchdog eyes possible gifts to pension fund staff

Associated Press

SACRAMENTO, Calif.(AP)-- The ethics watchdog agency for California is investigating 49 current and former staff members and executives at the state's biggest pension fund to determine if they improperly received gifts or failed to report them as required by law, officials said Monday.

The state's Fair Political Practices Commission confirmed the names of those being investigated after news reports appeared about the probe that began months ago.

The watchdog is looking into whether CalPERS workers received gifts worth at least $50 from someone in a single calendar year without reporting it, or received gifts from someone worth more than the legal maximum of $420, said commission executive director Roman Porter.
Trash Talk

Reseda, CA

#7 Jun 9, 2011

This year, CalPERS will pay out more than $1 billion to the nearly 9,000 pensioners with six-figure benefits -
a group that accounts for about 2 percent of all the system's beneficiaries.

The proliferation of six-figure pensions is in large part due to enhanced benefits that were handed out over the past decade or so, according to experts.

Citing the unsustainable nature of the pensions, public finance experts are calling for immediate reforms that include capping the maximum amount a pensioner can collect.

"Cities and counties are diverting an increasing share of general fund budget to pay for promises they couldn't afford then and can't afford now," said Stuart Drown, the executive director of the Little Hoover Commission, an independent state oversight agency that promotes government efficiency.


Recall that CALPERS is underfunded and its income projections are greater than its income.
Expect CALPERS to come knocking on your door for increased contributions.
Theolona ranger

Reseda, CA

#8 Jun 9, 2011
CALPERS should be included in the Budget "bucket of peril"
Trash talk

Reseda, CA

#9 Jun 15, 2011
An Associated Press examination of 50 balance sheets shows state budgets and bank accounts still ravaged by a drop in tax revenue. Many states are also facing enormous long-term pension and health care obligations

The 50 states have a combined $689.5 billion in unfunded pension liabilities and $418 billion in retiree health care obligations. Five states have unfunded public employee pension liabilities of $50 billion or more.

David Wyss, chief economist at Standard & Poor's in New York, called the pension debt "the biggest head wind that the states will be fighting against" as they try to climb out of budget holes.

"It's worrying because it's such a widespread problem," he said.

tates with big pension debts could be forced to pay more to borrow money.
Trash talk

Reseda, CA

#10 Jun 15, 2011
Our View: Both sides should tackle pension reform
Posted: 06/13/2011 01:00:00 AM PDT

EARLIER this year, the high-cost of public-employee pensions was portrayed as a partisan fight between Democrats and Republicans. The biggest example is the knock-down, drag-out that occurred in the state of Wisconsin.

But the partisan bickering and finger-pointing that went on in the Badger State and elsewhere is really a smoke screen that obscures the real story. That is, cities, counties and states are slicing off bigger pieces of their general fund to pay for ballooning pension contributions for retired employees. This means less funding for services such as police, fire, streets, recreation, etc. In short, the public that cities are sworn to serve get less, while a few elite retired "public servants" get more - and more and more.

The problem is serious, quite real, and one that Democrats and Republicans alike must tackle. The latest numbers bear this out.

Those public employees being handed a $100,000-a-year pension are no longer the extreme cases; they represent about one out of every 50 retirees. The number of retired public employees in the $100,000 club has quadrupled since 2005, according to the California Public Employees' Retirement System.

And that means local government will have to write bigger checks to CalPERS and spend less on services for their residents.
To cover the rising cost of retirees, they'll either cut more services or raise fees (don't call them taxes).

It's not a trend that is healthy.
And as we said earlier, it's not a trend reserved for one side of the aisle to fight.
Thankfully, we're seeing more interest in doing something about it.

Just last week, Andrew Cuomo, the governor of New York and a Democrat, began tackling his state's pension problem.
He's asking retirees to double the "employee contribution" to their own retirement so that the state of New York won't have to foot so much of the bill.
He's also advocating for an increase in the retirement age from 62 to 65 and said overtime should be excluded from calculating an employee's final salary.

Wisconsin Republicans taking on public employee unions? Not news.

Cuomo taking on the public employee unions in New York? Very big news.

It shows that the issue of public employee pension benefits has reached the tipping point and that both Democrats and Republicans assigned to balancing budgets of local government are taking it seriously.

Now on to California, where the Democrats, the majority of both houses, and Democratic Gov. Jerry Brown, must be just as dedicated to cutting the state's high CalPERS costs as the Republicans, a minority in Sacramento.

This should not be seen as a punishment for the hard-working public employees - and those are usually the ones who don't game the system.
But rather, as Cuomo in New York has realized, it is a must-do for California, too, so that eventually, spending can be brought down and services restored for schools and the poor.
Trsh talk

Reseda, CA

#11 Jun 17, 2011
Letters to the editor: Cut pensions
Posted: 06/16/2011 08:22:34 PM PDT

The state of California is going broke. Schools are laying off teachers. Cities and counties are short of funds.

To eliminate all these problems, why not stop all the extra pensions from the state, county, cities (including those for fire and police)?

Jeff Black

Trash talk

South El Monte, CA

#12 Jun 23, 2011
Shame on you Christina

Baldwin Park, CA

#13 Jun 23, 2011
How dare you mention the law suit that the two police officers filed. Those two officers went to WAR to fight for our country and all they asked for when they returned was their benifits that Federal Law entiled them to. The law was clear the city was the party that cost the expence of the attorneys. You should be ashamed of yourself. I hope that no one in your family ever has to serve their country and have you stand behind them. Christina get off your high horse and stop worrying about getting reelected. Start doing what the people voted you in for even if it makes you unpopular. You are unpopular already.

You and Chris Robles are dividing the City stop it and do what needs to be done. You selfishness is being projected and we are all seeing what a mistake was made putting you in office.

in the two years of being there you have done nothing and you expect another 4 years. Come on be honest with yourself and the people of montebello. you dont have what it takes be honorable DONT RUN. You expect to be given another chance when you did nothing the first time around. Take the free medical and the money the City has paid you as a gift. And start paying for your own medical as all employees are. You are Shameful, selfish and self centered, see it for yourself and walk away
Trash talk

South El Monte, CA

#14 Jun 23, 2011
Christina does not know when to vote NO and when to ABSTAIN
What does that have to do with Pension reform in Montebello?
trash talk

South El Monte, CA

#15 Jul 20, 2011

"The investment losses have fueled widespread criticism that CalPERS, which covers 1.6 million active and retired public employees and their families, does not have the financial wherewithal to meet future public pension obligations without increasing demands on the public treasury and, ultimately, taxpayers."

"Closing that gap will depend on lowering employee costs, Santana said, and one way to shave staff positions is to hand over control of some city services to nonprofits and private businesses."

"Ultimately the best pension reform is having less people relying on the pension system," Santana said.

Kan you hear the State knocking on Monebello's door?
Is there a reserve for this in the budget?
trash talk

South El Monte, CA

#16 Jul 20, 2011 ?
West Covina very ignorant or Union bias to article
You have to read the second half before it makes any sense.

"The city has asked the Association to forgo any salary increases and hazard pay, while also contributing 9 percent of their pay to their pensions, which would save the city $5.3 million over three years, Touhey said.

"They're not paying anything toward (the state Public Employees Retirement System PERS).
They don't want to do that at all," Touhey said. "They're no different than any other group.
Everyone is being asked to help pull the line."

Pasmant said cuts need to be made across the board to address the city's short-term cash flow problems and more long-term strategies, including offsetting rising pension costs among various bargaining groups, are also necessary

"One of the big concerns we have is that pension costs are continuing to grow even if we do nothing," Pasmant said.
"I believe in two years, we will be paying 50 cents on the dollar in pension costs alone in public safety."

Touhey said. "We're just trying to get by so we have a city and everyone has to pull their fair share."

Sound familiar, Montebello?
Reality Check

United States

#17 Aug 6, 2011

Same as last year, just renewed
Does not solve the Pension cost problem

Los Angeles, CA

#18 Aug 7, 2011
Reality Check wrote:
http://www.whittierdailynews.c om/news/ci_18626700
Same as last year, just renewed
Does not solve the Pension cost problem
All Municipal employees are having to contribute to help there respective employers due to accros the board reductions in revenue. The Municipalities that saw the storm comming and cut early and also had proper reserves are comming out of the storm damaged but recovering. Others like Montebello are not! The State of California's general fund budgets libabilities for employee pensions is less than two percent! Yes, CalPERS has suffered losses due to the recession but will rebound. There does need to be some reform and you are seeing local municipalities do just that. Overtime in California is not used in the Retirement calculations. Let's not place the blame on Pensions for all the Cities and States with budgetary problems. Each State and City has a different set of issues but one common problem. Reductions in revenue due to the recession, very poor planning, lack foresight and the propensity to spend most of their money and not have reserves for the down times that have been here before and will most certainly come again! ORG
Theolona ranger

South El Monte, CA

#19 Aug 7, 2011
Well said ORG
There should be an option for all pension contributions to be with before tax deductions (individual Federal income tax) instead of the employee having to pay thx and then pay his contribution ut of "take home".

Pensions actuarial calcualtions are being hurt more by the longivity factor now.
Uearned and unpaid for COLA will be a BIG prblem in the future.
What a waste

Maywood, CA

#20 Aug 7, 2011
Kudos to ORG. Montebello staff (Torres, etc.) and council (Molinari, Payan, Vasquez, Salazar, etc.), for decades, were negligent in their fiduciary responsibilities and lacked any clear vision. Now, both the employees and the community have to suffer by the reduction of services offered. Councils lacked the wherewithal to see long-term and could barely see in front of their noses let alone years ahead. Now we have a city on the brink of bankruptcy. Funny, Cortez' comments in the paper regarding impasse in negotiations. She has no clue how city government works demonstrating why this job is way too big for her.
Trash Talk

South El Monte, CA

#21 Aug 9, 2011
Arcadia safety staff to pay full employee share of pension costs (87%)

08/03/2011 - ARCADIA - Safety staff hired by the city from now on will be required to pay the full employee share of pension costs

The City Council on Tuesday adopted the resolution, which requires fire and police employees hired on or after Aug. 3, 2011, to pay their full employee share, or 9 percent, of their pension costs - an amount long covered by the city.

City officials say Tuesday's action is just the first step in revamping Arcadia's pension program, which if approved in its entirety, is anticipated to result in considerable savings to the city each year.

Four out of five public employee groups have tentatively agreed to pay their full employee share of pension costs by the end of three years,
though the increases during that period would be offset by equivalent annual raises.

""It's important that public employees are somewhat being treated equally to private sector employees," said Councilman Mickey Segal.
"And now in the city of Arcadia, over the next three years, our public employees will be paying for their own pension costs just like it happens in the private sector....
I believe we'll be one of the few, if any, cities in the San Gabriel Valley that are able to achieve this in one contract.""

Montebello had to implement immediately
Montebello does not know if it will have any additional income to fund any raises or any budget increases of any kind.
And no reserves if something bad happens.

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