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San Diego's Pension Deficit Prompts More Talk of Bankruptcy

San Diego city attorney Mike Aguirre is pushing for bankruptcy to deal with the growing pension deficit. But the city’s pension fund administrator urges against panic. KPBS reporter Alison St John h

San Diego's Pension Deficit Prompts More Talk of Bankruptcy

San Diego city attorney Mike Aguirre is pushing for bankruptcy to deal with the growing pension deficit. But the city’s pension fund administrator urges against panic. KPBS reporter Alison St John has more.

Aguirre argues the city doesn’t have a budget deficit, it has a pension crisis. Speaking at a hearing on budget cuts, he said libraries might not have to close if the city asks a judge for bankruptcy to reorganize the city’s liabilities.

Aguirre : We cannot afford to pay people 9 and ten thousand dollars a month in pension.

Aguirre says the pension fund has lost a billion dollars this year.

But pension fund administrator, David Wescoe, made an unusual appearance at city hall. He says Aguirre is using figures from the first quarter of this fiscal year, and next year’s pension payments wont be calculated till next July.

Wescoe : We are through the first act in a four act play, and until we know what the end is, it’s premature for me to tell you what the impact of today’s financial climate will be for the city.

The city’s pension payments wont go up till 2010 to cover this year’s financial downturn. Estimates suggest it could rise from $160 to $230 million ayear.

Alison St John, KPBS news.