State government is expecting a big increase in revenue this year — thanks to a strong stock market — and Governor Jerry Brown is proposing to use $11 billion to pay down debt from past years of overspending.
I think it's a good budget but not good enough.
On Capital Public Radio's Insight program Friday, Walters reminded Californians that the big pension funds are still in trouble. Those are CalPers plus the teachers' and UC systems' funds. The Governor's budget doesn't do anything about that.
At his news conferences Thursday Gov. Brown said he hasn't forgotten the pension issue. Another search turns up this overview of the pension problem on a website called California Budget Fact Check. It says there, the funds are underfunded by half a trillion dollars — trillion with the T!
The website also includes a recap of a proposal the governor made two years ago to fix the problem:
• Changing to a "hybrid" plan for newly-hired public employees — 401(k) plan, defined benefit, and Social Security;
• Raising the retirement age for newly-hired state employees to 67;
• Putting an end to pension spiking by changing the method by which retirement benefits are calculated for new employees from the highest single year salary to the highest three years;
• Prohibiting "pension holidays," where employee or employer contributions to pay for pension benefits are suspended;
• Ending the practice of allowing state workers to purchase "air time," or additional service credit for time they did not actually work;
• Requiring new state employees to work longer to qualify for retiree health benefits.
The legislature needs to get on this. It's a scary issue for most politicians and it's pretty boring for most voters. But inattention will lead to bankruptcy.
Next time you run into Sen. Cathleen Galgiani or Assemblyman Richard Pan, remind them.