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Pismo Beach pays $1 million to reduce pension liability

March 22, 2015
Mayor Shelly Higginbotham

Mayor Shelly Higginbotham

Pismo Beach City Council voted unanimously on Tuesday to approve a $1 million payment to reduce the city’s unfunded pension liability costs.

Currently, the city has an unfunded pension liability of $13.6 million. This includes $6.3 million in the safety police plan and $7.4 million in the city’s miscellaneous plan.

In Jan. 2014, the city council established a debt/pension reduction reserve of $1 million from the city’s general fund. City staff evaluated options on how to use the $1 million to maximize the city’s savings and reduce ongoing costs.

The payment approved Tuesday reduces the city’s unfunded pension costs by an estimated $670,000 and reduces the annual ongoing contribution of approximately $200,000 per year to CalPERS starting in fiscal year 2018-19. The unfunded pension liability is the difference between the estimated cost to pay retirement obligations and the market value of the assets currently set aside to fund those obligations.

“We are fortunate that we are in this position to pay down this unfunded liability,” Mayor Shelly Higginbotham said. “Although our revenues have improved, we have kept our costs down, set aside reserves for a rainy day and for these opportunities to reduce our debt. The early payment will save the city hundreds of thousands of dollars – money that can be put back into the community.”

 


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I find public pensions to be obscene. While I certainly appreciate the work the police and firefighters perform, the jobs just don’t carry the risks that so many other private sector jobs have. 3% a year X years service, retire at 50, pension can transfer to spouse, avoid taxes on disability pay, etc.


Public Safety Mortality Risk

U.S. Career Firefighters (not counting volunteers or part-timers) 11.1

CA Police Officers & Sheriffs (not corrections officers & jailers) 4.9


Other Occupations Mortality Risk

Commercial Fishers 127.3

Logging Workers 104.0

Airline Pilots and Flight Engineers 56.1

Refuse & Recyclable Material Workers 36.4

Roofers 34.1

Structural Iron and Steel Workers 30.3

Recyclable Material Merchant Wholesalers 28.4

Helpers, Construction Trades 26.8

Farmers and Ranchers 26.1

Driver/Sales Workers & Truck Drivers 24.5

Taxi Drivers and Chauffeurs 19.7

Electrical Powerline Workers 19.5

Drinking Places (Alcoholic Beverages) 18.0

Cement, concrete, lime, and gypsum product manufacturing 17.5

Grounds Maintenance Workers 16.9

Maintenance & Repair Workers, General 15.8

Construction Laborers 15.7

Landscaping Services 15.6

Mining, Quarrying, and Oil & Gas Extraction 15.2

Construction Equipment Operators 12.1

Athletes, Coaches, Umpires 10.3

Rail Transportation Workers 9.5


Unlike the private sector, public sector managers (politicians) don’t have the incentives to control costs. Actually, they have a mutually parasitic relationship together, both feeding off the tax payer base. If pay an pensions were at all comparable, I wouldn’t take issue with the total compensation. But this is just ridiculous.


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Look closely half of that is POLICE! Not including fire.That is where most of the money goes. Not your run of the mill city worker. Not to mention the lavish retirement plans of city management ( city managers etc) who are reviving thousands a year in extra comp benefits . Stop blaming the people who do all the work and get the least. Place blame where it belongs Police, Fire, and Managment.I am a public employee and my wife is private believe me her retirement and health benefits are much better.


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If you knew the crap cops have to deal with throughout their career you wouldn’t mind the pensions they are getting. Another thing, every one of you had a chance at their jobs too. Don’t begrudge them now that you are wishing you had the same thing and chose something else back in the day. I wouldn’t do a cops job for any amount of money. I have seen first hand what that job does to people and how soon they die after retirement because of the years of accumulative stress.


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Actuarial insanity. A drop in the bucket. Delays facing the FACTS about the broken pension system and it’s platinum-tipped benefits. Not a good move, but a predictable one from the drones and scammers in public office.


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Direct theft of your money to pay obligations that have been made but cannot possibly be kept. To be continued.


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Just maybe the government workers should have a pension plan more in line with the private sector? I know that will never happen but it’s nice to dream.


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Sheesh, I’d be happy if their pay and pension were more in line with reality, let alone the paltry private sector pensions.


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The huge wave of pension costs has only just started. If the pension system isn’t reformed, it will be the single largest part of the state budget. CALPERS is massively under funded and they have been investing money in schemes with ever increasing risk trying to earn larger profits so they can close the gap. The public employee unions will be running this state before they’re through. We work for them, not the other way around.


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Hmmm….I wonder if this will really help slow down the out of control gravy train. Robbing Peter to pay Paul never really works.


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