Issues
Editorial: PERS should stop fighting transparency
The Public Employees Retirement System shouldn’t be fighting to keep the public blind to what it is doing. But it did.
It spent $1,627 on lawyers to defend charging a reporter $112 for some records. And it lost.
Gordon Friedman of the Statesman Journal in Salem requested travel receipts of PERS board members. That’s the kind of thing that the public should have access to for free…
PERS told Friedman that he must pay to see the records. Friedman asked the Department of Justice to order PERS to release the documents for free, arguing that it was in the public interest.
The DOJ sided with Friedman and ordered the release…
We Respond & Your Comments
PERS is a horror show. Consider:
- It has over $21 Billion in unfunded liabilities;
- It’s going to cost $885 million more next year;
- “Contributions” from state and local governments will increase by 4% of payroll in 2017. And 2018. And 2019.
- It’s paying 23,000 retirees more than they made when they were working.
Our advice to the stars of this nightmare: you get in more trouble trying to cover up the mess you made than you’d have gotten for fessing up to the mess itself. Think Teapot Dome. Think Watergate. Think Monica’s blue dress.
OK, PERS brainiacs – we warned you. Now step up and fix it.
Oregon must contain the roaring PERS fire: Editorial Agenda 2016
By The Oregonian Editorial Board
…The fiscal conflagration known as Oregon’s Public Employees Retirement System will burn an extra $885 million in the next biennium to ensure retirees get their pensions and benefits as negotiated…
… Contributions by employers…are expected to go up by 4 percent of payroll in 2017, 2019 and 2021. That puts the employer contribution to the system at $4.5 billion for the 2021-23 biennium, more than twice what it is now…
But that’s to say nothing of the pressure upon public school systems, expected to find $335 million more to ship to PERS in the next biennium,..
…earnings on PERS investments last year were 2.11 percent, and this year through June just 1.24 percent — well below the unrealistic PERS-set expectation, upon which the system is configured, of 7.5 percent… [emphasis ours)
We Respond & Your Comments
PERS, and therefore Oregon taxpayers who pay for it, are in deep doodoo – old news.
What we want to focus on today is the last paragraph (above), which tells us that PERS projections rest on an assumed 7.5 % rate of return. The only way to get that kind of assured return today is to take risks that are far beyond unacceptable for pensions. Zimbabwe sovereign debt, anyone?
Why can public pensions use Bernie Madoff-type returns in their projections? Because they’re doing it with your money. Meanwhile, according to Steve Malanga, senior fellow at the Manhattan Institute, private pension funds, those offered by companies, must project future earnings based on a “risk-free” rate – currently below 3 percent. (http://www.wsj.com/articles/covering-up-the-pension-crisis-1472164758).
Why the difference? Because private pension funds need to live up to their projections. Public pensions? They can just reach deeper into your pockets to meet shortfalls caused by their delusional forecasts.
Corporate tax: Dueling PACs raise millions
By Gordon Friedman, Statesman Journal
Two groups campaigning on opposite sides of a ballot measure that would increase corporate taxes have raised millions of dollars ahead of the Nov. 8 election.
The proposed tax, called Measure 97, would create a 2.5 percent tax on sales exceeding $25 million for some corporations.
Our Oregon, the group supporting the tax, has raised $1.5 million so far. The money is from just two donations of $750,000 each by the Oregon Education Association and SEIU Local 503, the state’s largest public sector unions…
Gov. Kate Brown, a Democrat with longstanding ties to public sector labor groups, endorsed the measure last week…
We Respond & Your Comments
Were we less cynical we’d think the Oregon education Association (OEA) and the SEIU were dumping big bucks into Measure 97 because they want to buy more crayons and PCs for our kiddies.
But OEA and SEIU are unions, not child welfare agencies. Their mandate is to grab more money for their members, not do nice stuff for children. They’re behind Measure 97 because they know it’ll line their union members’ pockets. Period.
And Guv Kate’s with them because she knows a boatload of Measure 97 loot will be find its way into her 2018 campaign coffers.
Don’t say we didn’t warn you.
EDITORIAL: Facing a retirement crunch
Americans employed in the private sector are pretty much on their own when it comes to financing retirement…A new program taking shape in Oregon will broaden those choices, and ultimately reduce the burden on public services…
…nationwide, 42 percent of full-time private-sector employees between the ages of 18 and 64 have no workplace retirement savings plan. In Oregon, about half have no access to a (sic) such a plan…
The Oregon Legislature confronted this problem in 2015 by creating the Oregon Retirement Savings Plan…The plan will be open to all workers whose employers do not offer a plan of their own. It will be administered by the Oregon Retirement Savings Board…
…Enrollment will be automatic — workers will participate unless they choose not to. No employer contribution will be required. The savings rate will be 5 percent, unless workers choose to contribute at a higher or lower rate. The money will go into Roth IRA accounts…
We Respond & Your Comments
And now… the Salem brainiacs who did such a great job with the Columbia River Crossing ($200 Million down the drain), Cover Oregon (another $300 million), and PERS (God only knows what a mess this is)…
Are lining up to manage…your retirement! Herewith the “Progressive” principles on which this coming disaster are based:
- You’re too stupid to save for retirement;
- You need government “experts” to do it for you;
- Because you’re too stupid to sign up they’ll do that for you, too.
The timeless cliché comes to mind: “We’re from the government – we’re here to help you out.”
When you first notice that 5% of your paycheck is missing, just think “Columbia Crossing…Cover Oregon…MY RETIREMENT???” If you haven’t already opened an IRA this horror should be all the encouragement you need.
Editorial: Sales tax is a reach too far
‘Public employees unions run the statehouse,’ said state Rep. Dennis Richardson, during a 2014 visit to Astoria…
Now the public employees unions are asserting themselves grandly with Initiative Petition 28, the initiative to establish a corporate sales tax on corporations with gross receipts of more than $25 million annually…
The most correct title for the measure is the PERS Bailout Tax. Financial demands of the Public Employees Retirement System will soon increase the load on school districts and municipalities — causing schools to lay off teachers in order to fund retirement pensions.
Legislative remedies to the PERS dilemma …were thrown out by the Oregon Supreme Court. In the face of the court’s judgment, there was a proposal to require new PERS enrollees to contribute to their retirement, in the manner that is common in the private sector. Oregon Gov. Kate Brown would not support that.
Revenue raised by IP 28 is the unions’ answer to the PERS problem…
We Respond & Your Comments
We’re shocked! Shocked! When “Progressives” first tossed IP 28 on the table The Oregonian reported “Unions and other left-of-center groups argue that major tax hikes on major corporations and the wealthy are needed to shore up education and other public services…”
We thought IP 28 was “for the children.” After all, isn’t any tax? We thought it would buy smaller class sizes, music education and other good stuff. And now we learn it’s really for pensions for public employees? How sad.
Actually, we’re not that stupid. We knew all along IP 28 is a way for “Public Servants” to serve themselves the money you earned.
Hats Off to Our County Commissioners!
State of the County
…When the legislature passed PERS reform in 2013, our financial, legal and Human Resources staff recommended to the Board that we set aside the projected savings in a reserve account because of the potential for those reforms to be overturned in the courts. In addition, that same staff had bonded some of our PERS liability when interest rates were low and nearly fully funded our liability.
This higher level of funding directly impacts the rate that Lane County is charged to cover PERS expenses for our employees.
While other public employers in Oregon, with less than 80 percent of their PERS liability funded, saw their rates raise by as much as 6 percentage points in FY 15- 16, Lane County experienced an increase of just 1.8 percentage points for the same time period. If we had experienced a 6 percentage point increase, it would have cost Lane County an additional $3.3 million dollars annually.
This cost avoidance, along with the reserve set aside… provides greater financial stability for Lane County into the foreseeable future….
We Respond & Your Comments
Usually, asking politicians not to spend money is like putting a T-bone steak in front of your dog and asking him not to eat it ‘til tomorrow. But not so with our Lane County Commissioners!.
Please join us in giving a big round of applause to our County Commissioners for having the foresight to put money aside in case PERS reform turned sour – which it did.
It’s always easy to criticize government. So it’s important that when our elected leaders do the right thing to acknowledge it and thank them.
So – Jay, Pat, Sid, Faye & yes, Pete too – a big THANK YOU!
Our Salem Tycoons
Of 90 members of the Oregon Legislative Assembly, not even half have run a business. But they think their inexperience qualifies them to tell Oregon businesspeople how to run theirs.
The legislative agenda of these Donald Trump wannabees includes Senate Bill 454, which mandates that all businesses with 10 or more employees give paid sick leave to every one of them, even if they’re part time. Economic analysis reveals a $2 billion cost per year for businesses.
Then there’s House Bill 2960, which sets up a state run retirement savings program for employees without one. Employers, at their expense, would deduct contributions from employees’ salaries and pass them on to the state, which would run it (Cover Oregon, anyone?).
When PERS crashes on the rocks of financial reality would our Salem whizbangs raid this new retirement fund to save PERS?
When you give power to a crowd that wouldn’t know a payroll if it bit them and who sees business as a cash cow mooing to be milked to pay for a “Progressive” agenda – this is what you get.
EDITORIAL – Face up to pending retirement crisis
State plan could help Oregonians build savings to supplement Social Security
– The Oregonian
A convergence of economic and demographic factors…threatens the United States with a retirement crisis…
…According to the Employee Benefits Research Institute, 36 percent of Americans have saved $1,000 or less for retirement…
In 2011, 31 percent of private-sector workers participated in a defined-contribution retirement plan….
That leaves about two-thirds with no workplace-based pension or retirement savings plan…
[Oregon Treasurer Ted] Wheeler asked the state Legislature to address the retirement crisis last year, and it responded by creating a Task Force on Oregon Retirement Savings…
The task force’s draft report…recommends creating a workplace savings plan that would be available to anyone employed in Oregon… Money to fund savings accounts would be automatically deducted from workers’ paychecks unless they chose to opt out… The savings accounts would be pooled and professionally invested by private fund managers, overseen by a state board…
We Respond & Your Comments
And now – from those wizards who blew $175 million of your dollars planning the Columbia Crossing bridge, light rail and highway complex and have nothing to show for it and then tossed another $248 million after it to build the Cover Oregon health insurance exchange, which featured a website that couldn’t sign up a single individual…
Comes a program to manage your retirement nest egg! Who could resist this offer? Where do we sign up? What could possibly go wrong?
http://registerguard.com/rg/opinion/32044981-78/face-up-to-pending-retirement-crisis.html.csp
Time to “Move On” – To More Taxes
“Budget bargaining at the Legislature has focused too much on cutting retiree pensions and not enough on the other half of the equation — injecting millions of new dollars into education and mental health programs,” Gov. John Kitzhaber said Friday. In a meeting with The Oregonian’s editorial board, the governor said “the conversation has to change,” and he laid out in the greatest detail to date the elements of a deal that he says leaders from both parties are painfully close to striking. He also said the key could lie with Senate Republicans, and in particular their leader, Sen. Ted Ferrioli of John Day. If Ferrioli gives the nod to tax increases that would produce $275 million in new revenue, he said, the deal is likely to fly. – The Oregonian, June 7, 2013
Lane Solutions Replies:
That’s right, Governor – It’s time to move on. Let’s get off this crazy PERS-cutting bandwagon and get on with what you really want – more taxes.
We’ve heard enough about cutting this PERS behemoth where the rules are made and enforced by the beneficiaries; where costs are predicted to rise $200 million next year (that’s the cost of 2,224 teachers, Guv); where some make more in retirement than they did working.
Let’s get on with what you wanted all along – a sales tax, higher marginal income tax rates to “tax the rich,” higher corporate taxes and more fees. Let’s scoop more money in so you can shovel it out to the teachers’ union. After all, you don’t get elected by spending less!
Let us know what you think below
PERS: What Went Wrong and How Bad Is It?
Next school year, PERS will cost school districts an additional $200 million. That’s the equivalent of employing 2,224 teachers. Experts predict that PERS costs will continue to rise for years.
The problem arises from Oregon’s unique “money match” PERS program that enables many employees to earn more in retirement than they did while working. The result is a very expensive system that, as a share of our economy, is the third most costly in the U.S.
As the Governor and legislators wrestle with solutions, it’s important to understand the nature of the problem.
Watch this short video, prepared for the Oregon School Boards Association and narrated by economist John Tapogna, to learn about how we got here, and what will happen if we don’t fix the system now.
What is the Oregon Business Plan?
The Oregon Business Plan is an effort by the state’s business leaders to create 25, 000 new jobs across Oregon each year and raise Oregon’s per capita income above the national average. The Plan is a collaborative effort among several business leaders and business associations, developed in close partnership with Oregon’s elected leadership.
We envision achieving the Business Plan goals by growing diverse, thriving clusters of industries that are global leaders in product design and innovation. The strategy to boost these industries is to improve the conditions necessary for them to succeed: talented people, greater productivity, quality of place, and pioneering innovation – what we call the 4Ps for prosperity.
Learn more at www.oregonbusinessplan.org.
Reprinted with permission from Oregon Business Plan