Pension finances

Jan 23, 2012

Since earnings off investments are likely to fund the lion's share of pensions in future decades, it would be a good idea to let people know exactly how those investments are doing, according to a new report. CalPensions' Ed Mendel tells the story.


"Investment earnings are expected to provide two-thirds or more of the money needed to pay pensions in future decades. Critics say earnings forecasts, 7.75 percent a year for CalPERS and CalSTRS, are too optimistic and conceal massive taxpayer debt. To make more pension information public, the first report of an actuarial panel recommends, among other things, that retirement systems add a “sensitivity analysis,” which is likely to show what happens if earnings miss their target in the next few years."


"It’s not a long-term forecast like a Stanford graduate student study two years ago. Using a lower risk-free bond rate advocated by some economists, 4.1 percent, the study showed how state pension debt ballooned from the reported $55 billion to $500 billion."


Apparently, some employers with jobs to fill say only those who currently have jobs should apply. With unemployment at 11 percent, this practice is drawing criticism, and a bill in the Legislature would ban the practice.


From the Bee's Jim Sanders: "New Jersey has passed a law banning such advertisements, federal legislation is pending, and a newly proposed California bill, Assembly Bill 1450, would prohibit discriminating against the jobless in hiring. "It's the same as excluding a particular religion or minority group – it's wrong," said Assemblyman Michael Allen, a Santa Rosa Democrat, who is the author of AB 1450."


To the question of whether redevelopment agencies are really useful, the answer in the tiny Fresno County town of Friant is -- not much.


From the Fresno Bee's Kurtis Alexander: "Despite collecting nearly a million dollars in taxes, the county agency has little to show for it. No local roads have been paved, no housing has been built and few businesses have been attracted to the area -- all common goals of redevelopment programs. The agency's biggest goal, building a sewage-treatment plant to replace leaky residential septic systems, never even got beyond the planning stage."


San Francisco Sheriff Ross Mirkarimi is under pressure to resign because he faces three criminal charges related to domestic violence.The Chronicle's Rachel Gordon has the story.


"Mirkarimi has consistently denied the alleged abuse and last week entered a plea of not guilty to charges of domestic violence battery, child endangerment and dissuading a witness. The charges stem from a New Year's Eve incident in which prosecutors allege that Mirkarimi grabbed his wife, Eliana Lopez, hard enough to cause bruising on her arm in the presence of the couple's 2-year-old son. Mirkarimi is alleged to have mistreated his wife twice last year, according to the arrest affidavit."

Speaking of San Francisco law enforcement, a federal probe is under way into alleged corruption at the S.F. police department. The probe is part of a series of federal investigations nationwide.

From Justin Scheck in the Wall Street Journal: "A videotape found more than a year ago by a defense lawyer in a routine drug case has helped spark this city's biggest police-misconduct probe in years—one of numerous investigations into law-enforcement practices being conducted nationwide by the U.S. Department of Justice. The tape, attorney Scott Sugarman says, showed his client dressed in a black jacket as police arrested him. But officers wrote in statements that the defendant was wearing a white jacket that contained drugs. The drug-possession case was dismissed by prosecutors."

The mid-year is a popular time at California universities -- there has been an infusion of students at CSU and officials are putting together an operation to help them get oriented to the campuses.

From the LAT's Carla Rivera: "More than 60,300 applications were submitted to the California State University system's spring term, which gets underway Monday. The vast majority are community college transfers; and typically, between 15,000 and 20,000 of those enroll.

The ability of these spring students to integrate into campus life can affect not only their grades but also whether they stay in school. So an increasing number of campuses, including Long Beach, are requiring that all students — whether entering in the fall or midyear — participate in orientation sessions.


Get the daily Roundup
free in your e-mail

The Roundup is a daily look at the news from the editors of Capitol Weekly and
Privacy Policy