This article doesn't tell the whole story. Yes, PERS is a problem in Oregon. However, some of the anecdotes of counties cutting services are not related to PERS. For example, Josephine County, next door county to mine, has the lowest property tax rates in the state. Property owners in the county have repeatedly rejected tax increases to pay for basic services like the Sheriff's Department, and as a result have experienced some of the cut backs described in the article. This is not a result of PERS contributions.
A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
131–140 of 277 posts
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#132Earlier quoted context omitted.
The federal government isn’t state and local. Also note that the Feds no longer have generous pension plans and rely on 457 plans similar to 401k. Someone in my family ran a fire department in the 80s and 90s. They had no money and in this state arbitration made negotiations difficult for management to win. So they gave away pension and health concessions that were cheap then. The number one issue with these systems…
The pension and health concessions were never cheap to give away. Someone just had the brilliant idea that since voters aren't able to spend time analyzing and verifying the numbers, and there are no laws regarding how to calculate them, that you can just understate the costs and let the future deal with it.
That’s not really accurate either — it’s a complex issue.
Nobody in 1990 would have predicted the decade of double digit cost increases that came in the 2000s and 2010s.
Pension contributions did have fiscal impacts, at least in states that require that pensions actually be funded.
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#133My mom is a PERS retiree. Not one of the rich ones, though she did retire at the perfect moment and she has a livable retirement income. One thing a lot of people (who do not work in gov't) don't recall is that while the economy was roaring back then, Oregonians working for the gov't went for years without so much as a cost of living adjustment. Some of the perks they got from PERS were in lieu of getting a raise. So…
For the most part, government work does not pay poorly.[1] For example federal employees without advanced degrees earn a lot more in government than in the private sector: https://www.google.com/amp/s/www.washingtonpost.com/amphtml/... [1] I’m willing to entertain the idea our economic system as a whole undercompensates secretaries and overcompensates executives. That’s a different issue.
In California many/most public employees earn over 6-figures in total compensation. This includes government employees, teachers, police, Fire, etc.
Yea, it’s insane.
Don’t believe me? Look it up - https://transparentcalifornia.com/salaries/2017
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#134This article doesn't tell the whole story. Yes, PERS is a problem in Oregon. However, some of the anecdotes of counties cutting services are not related to PERS. For example, Josephine County, next door county to mine, has the lowest property tax rates in the state. Property owners in the county have repeatedly rejected tax increases to pay for basic services like the Sheriff's Department, and as a result have experi…
Well if PERS was not there, that money would have been available to pay for Sherriff's department. Just saying lets tax them is not always the solution.
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#135I mean, the obvious solution is to move to purely defined-contribution plans and haircut the existing people down to actual returns on invested balance for them. But I have to imagine in a lot of cases that would lead to people being impoverished later in life, which is not especially humane.
is it humane or an entitlement?
most people in the private sector work their whole life never get anything remotely close to a pension
secondly, its just an intergenerational wealth transfer. another excess of the selfishness of the boomer generation. Who will pay the price ... the school kids getting a crap education in 35 student classrooms in crumbling buildings in a towns who's infrastructure is going to literally fall apart in 2 decades time from zero maintenance. Ah well at least we kept the promises some corrupt politicians made in the 90s to well-off gov workers.
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#136Earlier quoted context omitted.
civil servants and the like get to retire with almost their best pay ever That system changed in 1984 . Now the FERS annuity is (for most people) about half of their highest pay. https://en.wikipedia.org/wiki/Federal_Employees_Retirement_S... (It's still a decent deal, but it's not a defined benefit plan based on your highest pay)
> the average annual rate of basic pay of the employee's highest-paid consecutive three years of service (commonly referred to as the "high-3" period).[3] The "high-3" period normally is, but does not have to be, the final three years of service ??
To add to Doreen Michele’s comment. A friend of mine went from a GS-11 to a GS-7 to change career paths. This meant a reduction in pay for several years. Supposing he retires today (he has enough years to be vested for the pension but can’t collect for another 12 or so) his retirement pay would be based on those years he was a GS-11. Now the period 6-3 years in the past. He’s a GS-12 now (or soon) but the prior pay still works out to a higher average for him.
Additionally, locality pay is included for the calculation. It’s not just base pay. This means if he moves to DC for a few years and then later to “rest of US” (unspecified, lowest paid parts of the country) his time in DC may be what they use to calculate his pension and not his last few years.
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#137Earlier quoted context omitted.
In California "More than 200,000 civil servants became eligible to retire at 55 — and in many cases collect more than half their highest salary for life. California Highway Patrol officers could retire at 50 and receive as much as 90% of their peak pay for as long as they lived." http://www.latimes.com/projects/la-me-pension-crisis-davis-d... This seems like a pretty big budget item, especially since most CA governme…
In addition, it's not necessarily salary of the last year - it's income from the state. Which, until a few years ago, included overtime and unused sick/vacation days. The incentives were totally crazy - cities and counties paid salaries up front, but the state generally paid pensions. So it was common practice to divert all overtime to employees who were going to retire that year, to spike their income and get them a…
Public sector pensions should be run by a Federal Reserve-like "appointed but not elected" system.
As you've stated, actuarial calculations + short term politics don't mix.
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#138I mean, the obvious solution is to move to purely defined-contribution plans and haircut the existing people down to actual returns on invested balance for them. But I have to imagine in a lot of cases that would lead to people being impoverished later in life, which is not especially humane.
is it humane or an entitlement? most people in the private sector work their whole life never get anything remotely close to a pension secondly, its just an intergenerational wealth transfer. another excess of the selfishness of the boomer generation. Who will pay the price ... the school kids getting a crap education in 35 student classrooms in crumbling buildings in a towns who's infrastructure is going to literall…
I think the real answer is increased taxation and haircuts, call it a "reverse cost of living" scheme. I do know the current benefits are significantly less generous than the old system used to be, so it's primarily a problem with a certain generation rather than PERS as a whole.
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#139Re the ongoing debate here about government pay (and whether it's high or low): I'm not super familiar with city and state government jobs, but I do know something about military and federal compensation. They frequently pay less in salary, but have better benefits. This makes it an apples to oranges comparison when trying to talk about what they pay in comparison to non government jobs. I was a military wife for a l…
Is there a standard measure of disposable income after taxes and necessities like food, housing, education, healthcare? It seems comparing how much people have available for discretionary spending would be useful in many cases.
Re: A $76,000 Monthly Pension: Why States and Cities Are Short on Cash
#140Earlier quoted context omitted.
Mentioning federal employees in a discussion of state/local employees is an apples-to-oranges comparison. Please provide sources to counter the assertion that state/local employees often get large pensions in lieu of salary.
Here are the top government earners in SF county: https://transparentcalifornia.com/salaries/2017/san-francisc... I don't immediately see examples of 'pensions in lieu of salary', but those are some pretty substantial total packages, with benefits alone reaching ~$60k+/yr for many public officials.
So, of San Francisco county employees listed there, 3% have a total pay > $200k.
Given the cost of living in the area, it sounds like they might actually be paying competitive salary, though it also looks like a lot of the people in that 3% are actually firefighters or sheriff's officers who pull in a lot of overtime.
"Benefits" also isn't a great category to look at, because I'd be willing to bet that if you're a software developer your benefits package is pretty expensive too and you just don't realize it. Going by their definition of "benefits", and looking up some of my own records, it looks like $60k is not that hard to hit. Insurance and 401(k) matching (or pension contributions, for a government employee) are more expensive than you probably think they are.