Quote:
Originally Posted by Hugh R
I have a problem with lucrative pensions that allow police and fire to retire at 50 and pension rules that allow them to collect pensions that are ... 100% of your last salary.
|
Again, Check your facts.
The pension disbursements (except in rare cases like the City of Los Angeles and the City of San Diego) are not paid by cities. The cities pay into a pension fund called CalPers. The contribution formula for police/fire is 9%.
The city pays into CalPers and then when the person retires, CalPers pays the monthly benefit. Take a good look at CalPers. You will see that CalPers is solvent. CalPers has never missed a payment and likely never will.
Further, the shortfall seen by some cities occurred because during the years when the stock market was very strong the CalPers Pension Fund was DEEMED FULLY FUNDED and as such, CalPers was politically pushed into the position of giving cities the “option” of fully funding (paying the 9%) into the fund OR NOT. Many foolish cities chose the OR NOT option and instead spent the money on other things instead of paying the 9% into the fund.
Fast forward to the dot.com crash and the resulting downward stock market trend, and suddenly CalPers told the cities that their accounts were NOT FULLY FUNDED and that “catch up” cash infusions would be required. Thus, the resulting shortfall.
You obviously didn’t read the info that I stated in my prior post. The state is short 10,000 police officers. Any city that hopes to attract new police officers would get ZERO applications if they cut the pension benefit. Remember, California pretty much sucks. Other states are much more appealing to young guys who want to be police officers, raise a family and have a decent life. California has to compete with this.
One last thing… please give the “100% pension” and “Lifetime Medical Benefits” rhetoric a rest. CalPers caps the pension at 90% (after 30 years) and hardly any city offers “lifetime medical.”