Playing Politics with Public Employee Pensions

pension-reformWhile most people have likely been mesmerized by the headlines citing rising pension costs, annual public pension payouts for executive managers in excess of $100,000, and pension fund losses resulting from the greatest recession since the Great Depression, a less visible campaign has been waged locally by self-described “pension reformers” to needlessly raise the cost of public pensions for the taxpayer, and their public employees to astronomical levels. Nick Berardino points this trend out in his latest Orange County Register commentary here.

Nick Berardino

Nick Berardino, General Manager OCEA

Since Berardino’s column is sitting on the other side of a pay-wall that some folks refuse to cross, we offer a few highlights of his discussion of what is going on at the Orange County Employees Retirement System which manages $10.5 billion in pension funds for employees of the County of Orange, the Orange County Fire Authority, and more than a dozen other local agencies.

Over the past year the OCERS trustees – some of whom actively bash pensions in public and belong to aggressively anti-public employee organizations – have taken one action after another to artificially drive up the cost of pension benefits.

This isn’t about “facing reality” or “not kicking the can down the road” or “inter-generational equity.” It’s about furthering a radical political agenda. And the sickest part of this scheme?

They are funding it with your taxpayer dollars and it’s you who are paying for it. You should also know some legitimate facts that are repeatedly left out of news stories and editorials.

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Here’s some context to the assault the OCERS Board has made on you, the unsuspecting county taxpayer: For fiscal year 2013-14, let’s compare the cost of the same benefit formula – 2.7 percent at – to three employers: the cities of Irvine and Anaheim, which belong to CalPERS, and the County of Orange, which belongs to OCERS. Anaheim: 21.642 percent of pay; Irvine: 24.138 percent of pay; the county: 32.91 percent of pay.

Not only that, the OCERS board has already taken unnecessary actions that if not reversed will raise rates at least another 6.5 percent over the next two years.

Berardino points out that some politicians understand the public employee pension issue resonates with the public. So in order to keep the issue in the forefront, those politicians have an interest in creating doomsday scenarios and making the cost of pensions to taxpayers as high as possible. What disturbs us is that those same politicians sitting on the Orange County Board of Supervisors appoint the four members of the OCERS Board. Those appointees, along with the elected County Treasurer, are hell-bent on destroying the stability the OCERS fund for the sake of promoting a single-minded political ideology. They have no problem raising the costs on taxpayers and public employees to exacerbate the costs of pension benefits.

We don’t often recommend that our readers spend good money to cross the Orange County Register’s pay-wall to get facts. But we make an exception in this case. If you do not already have a subscription to the Orange County Register, at least pay the small fee, to read Berardino’s commentary. We feel your enlightenment will far exceed the cost of the experience.

The Voice of OC also has a story today regarding the recent flip-flop on the part of the County Treasurer Shari Freidenrich that demonstrates, in excruciating detail, the ends to which those seeking to destroy the OCERS pension fund are willing to go to achieve their goals.

  2 comments for “Playing Politics with Public Employee Pensions

  1. Robert Lauten
    July 16, 2013 at 6:12 pm

    OCERS’ fund performance as of May 31, 2013
    1 Month = -0.58%, Year to date = 4.64%, 1 Year = 14.56%, (also 3, 5, 7, 10, & 15 year stats) 20 Year = 8.18%
    The Investment Committee hires real return and GTAA managers. OCERS’s investment decisions any who they hire are listed on their web site.
    http://www.ocers.org/latestnews/ocersextra.htm
    In my un-professional opinion the OCERS’s investment board is doing an excellent job, fulfilling their fiduciary responsibilities.

    On the other hand CalPERS is only being ‘Politically Correct’ with their policy of United Nations backed “Sustainable Investment.”
    http://www.calpers.ca.gov/ (click “Global Governance Website”)
    According to:
    http://www.statebudgetsolutions.org/blog/detail/calpers-latest-financial-report-shows-another-dismal-year
    CalPERS’ 2011-2012 return = 0.1%, 5 Year = -0.1%
    (CalPERS claim’s an investment return of 12.5% for fiscal year 2012-2013).

    There needs to be a CalPERS investigation, (-0.1% over 5 years and then a 12.5 return last fiscal year).

  2. junior
    July 25, 2013 at 5:58 am

    Both this article and Berardino’s are long on accusations and short on facts.

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