Pensions for Breakfast
Tuesday, March 3, 2009
The San Diego Taxpayers’ Association held a breakfast meeting this week to chew over the subject of San Diego city’s pension benefits. KPBS reporter Alison St John was there.
The numbers emerging in connection with the city of San Diego’s pension obligations are pretty indigestible. The unfunded liability is now around $ 2 billion dollars.
San Diego City Councilman Carl Demaio is one of many voices calling for reform.
Demaio : "You cannot sustain these benefits!"
Former city councilman Michael Zucchet is now a consultant to the city’s white collar workers union. He says it’s wrong to blame the unions, because the city decided to give better pensions to make up for sub standard salaries.
Zucchet : "Their total compensation is decidedly average."
Zucchet says San Diego salaries and benefits are not out of line with other cities.
Marcia Fritz is with the California Foundation for Fiscal Responsibility. She says all public employee pension benefits began to escalate after a 1999 decision when the state made pensions more generous. Back then, she says, the actuaries did not warn legislators of the risks.
Fritz : "I have seen a change in the way that actuaries are now discussing openly they are cautioning board members about the risk, which they never did before"
Indeed, the San Diego pension system’s actuary recently told the council that annual pension payments for city workers could escalate to $250 million dollars in 2010. That’s $100 million more than the city paid into its fund this year, and approaching 20 % of its General Fund.
Alison St John, KPBS news.
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