CSPP RELEASES "PENSION ROULETTE PART 2
DO YOU FEEL LUCKY"
Citizens for Sustainable Pension Plans has released a new report that demonstrates the dire financial condition of Special Districts in Marin
County as well as the Golden Gate Bridge District.
The report, which studied the following Special Districts concludes that the pension
plans and retiree benefits they offer are exorbitant and dangerously underfunded.
- Marin Municipal Water District (MMWD)
- North Marin Water District (NMWD)
- Novato Fire Protection District (NFPD)
- Marinwood Community Services District (MCSD)
- Golden Gate Bridge Highway & Transportation District (GGB)
Summaries of Pension Roulette 1 and 2
OCTOBER 6, 2013
March 11, 2015
To Change Your Vote Simply Call The District At (707) 285-2200.
Marin Voice: Mosquito district tax looks like a pension bailout
By Paul Premo
POSTED: 03/11/15, 10:24 AM PDT |
Citizens for Sustainable Pension Plans, of which I am a core member, recommends a “no” vote on the Marin-Sonoma County Mosquito and Vector Control District’s tax increase ballot.
With little advance warning and little explanation, taxpayers in Marin (and Sonoma) counties received a ballot from the district asking for “yes” votes to impose a never-sun-setting substantial percentage increase in the district’s tax. The district’s board approved the measure at its Feb. 11 meeting, with only two directors dissenting among the 24 on the board.
The board doesn’t meet again to receive public input on the measure until the deadline for voting, April 15.
The district’s official notice to affected taxpayers states the purpose for the additional tax is to “provide supplemental funding for improved, comprehensive, year-round mosquito, vector and disease control services.” If voters approve this additional parcel tax, the expected $3.6 million per year (escalating annually with built-in inflation rate of up to 5 percent) will be collected indefinitely.
No process for periodic review and justification, nor sunset date is mentioned.
The district has an annual budget of approximately $8 million and has reserves of about $10 million. The district has reserves that will last about six years.
Apart from the questions of why is the tax necessary at this time and why hasn’t the district allowed for public hearings prior to the time by which voters’ ballots must be filed, I note that the district has serious unfunded retiree pension and medical care benefit liabilities, plus rising needs to fund those shortfalls absent benefit reductions.
I conclude that the “need” for the tax likely is not merely for the purposes quoted above, but also because the promises it has made for future retiree benefits cannot be met absent significant funding of those liabilities.
In short, this is another example of retiree benefits crowding out provision of basic services.
The “easy” solution, as here, is to fund rich retiree benefits with parcel taxes on an ad-hoc basis, without addressing the underlying reason for the taxes, nor considering further adjustments to those retiree benefits or funding sharing between employees and taxpayers.
The 2012-13 Marin County Civil Grand Jury, on which I served as foreperson pro-tem, noted in its report on retiree health care benefits that the district had the highest liability — $12 million — for unfunded retiree medical care benefits among all surveyed entities that were in the sad situation of having undertaken no pre-funding of those liabilities.
The district has since updated that liability to $15 million, as of July 1, 2013. And the district’s financial reports, as of June 30, 2014, disclose that it continues to only pay current retirees’ medical benefits as they come due, and thus remains zero-percent funded to address the $15 million liability. Those annual premiums cost the district about $141,000, a far cry from meaningfully addressing its true liability.
The district’s employee pension situation is similarly bleak, unless benefits are reduced or funds, such as from the proposed tax, are obtained.
Its financial reports disclose pension liability — cost today of future promised payments — of $11.5 million, against which it has $4.1 million in a trust account. The district presently contributes $500,000 annually to the trust.
Are promised retiree benefits being negotiated down? Is the proposed tax required because of these retiree benefit promises that are crowding out essential district services?
We won’t know the answers until April 15, if at all — and that’s too late.
Citizens for Sustainable Pensions recommends a “no” vote on the mosquito district tax and looks forward to a full discussion by the district on such matters in open forums with adequate notice and consideration of alternatives.
Paul Premo of Mill Valley is a member Citizens for Sustainable Pensions, a Marin-based public pension reform group.
The Next Step: Civic Openness In Negotiations
Now is the time for the Marin Board of Supervisors to increase transparency by adopting a sensible policy that allows taxpayers to understand and comment on the impacts of labor negotiations before they are finalized. Please read and support the policy recently implemented by the city of Costa Mesa that is already having positive impacts.
We Must Solve Marin's Pension Crisis Now!
Marin Taxpayers may be obligated to pay under-funded retirement pension benefits that are estimated between $700 million and $1.2 billion.
The impacts of this pension disaster will be felt soon as Marin County struggles to meet its generous and unsustainable retirement promises amid declining property tax revenue, unrealistic investment projections, and more.
Public Sector retirement benefits have grown dramatically over the years thanks in large part to the political influence of labor unions. State workers routinely retire at 55 years old with pensions higher than their base pay for most of their working lives.
Pensions are at the center of what will be an intensifying fight for diminishing resources from which government can pay for schools, police and fire services
Sweeping Reforms Are Needed - Join CSPP
Agreement on The True Magnitude of the Problem