Category: ballot propositions

Pension Initiative Seems to Be Out of Gas (for Now)

Earlier posts noted a pension initiative drive – fronted by San Jose Mayor Chris Reed – that would have swept in UC.  For now, the effort seems to have stalled.  The proponents have decided to litigate the title and summary by the attorney general of the initiative.  Effectively, that will take enough time so that they will not be able to gather the signatures needed to get the initiative on the November 2014 ballot.  The decision to litigate may just be a polite way to bow out for now.  See:
http://www.sacbee.com/2014/01/30/6116016/public-pension-measure-likely.html

Of course, if your car stalls for whatever reason, you are in trouble:
[youtube http://www.youtube.com/watch?v=T8yKa-c-1nI?feature=player_detailpage]

Neutral

Proponents of the  proposed pension/retiree health care initiative (that would cover UC) were afraid the attorney general would come up with a nasty title and summary.  It doesn’t seem to have happened, however.  Other than the references to teachers, nurses, and peace officers (the public’s favorite public employees), it is pretty neutral.  To the extent there is mention of costs, the references come from the earlier Legislative Analyst’s Office (LAO) report.  Below is the title and summary:

January 6, 2014
Initiative 13-0043
The Attorney General of California has prepared the following title and summary of the chief purpose and points of the proposed measure: 
PUBLIC EMPLOYEES. PENSION AND RETIREE HEALTHCARE BENEFITS. INITIATIVE CONSTITUTIONAL AMENDMENT. 
Eliminates constitutional protections for vested pension and retiree healthcare benefits for current public employees, including teachers, nurses, and peace officers, for future work performed. Permits government employers to reduce employee benefits and increase employee contributions for future work if retirement plans are substantially underfunded or government employer declares fiscal emergency. Requires government employers whose pension or retiree healthcare plans are less than 80 percent funded to prepare a stabilization report specifying non-binding actions designed to achieve 100 percent funding within 15 years.
Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local government: Potential net reduction of hundreds of millions to billions of dollars per year in state and local government costs. Net savings—emerging over time—would depend on how much governments reduce retirement benefits and increase salary and other benefits. Increased annual costs—potentially in the hundreds of millions to billions of dollars—over the next two decades for those state and local governments choosing to increase contributions for unfunded liabilities, more than offset by retirement cost savings in future decades. Increased annual costs to state and local governments to develop retirement system funding reports and to modify procedures and information technology. Costs could exceed tens of millions of dollars initially, but would decline in future years.

Does this official summary mean that the governor is going to be neutral?  Who knows?  One member of the anti-pension crowd managed to slam the governor’s high-speed train today in the NY Times – which might not endear him to Brown:

High-Speed Train in California Is Caught in a Political Storm 
By Adam Nagourney

…Joe Nation, a professor of public policy at Stanford University and a critic of the plan, said Mr. Brown would have to grapple with this decline in support, which he argued reflected voters’ growing doubts about the basic competence of government. “Obamacare has leached over into this,” Mr. Nation said. “You have people saying, ‘The federal government that can’t build a website — how can we expect them to build a multibillion-dollar train?’ ”…

Full article at http://www.nytimes.com/2014/01/07/us/high-speed-train-in-california-is-caught-in-a-political-storm.html

As we continue to note, UC’s interest is basically not to be included.  So far, as per above, that hasn’t happened.

UPDATE: Mayor Reed of San Jose – the front man for the initiative – isn’t happy with the wording. The union group opposing the initiative isn’t completely happy, either. See http://www.sacbee.com/2014/01/06/6051649/california-attorney-general-clears.html

Follow Me, Says Crane

We have previously reported on a proposed ballot initiative on public pensions in California that, as written, would cover UC.  There appears to be money behind the campaign for this initiative.  Another indication of such money comes in the form of a letter by former UC Regent David Crane on CalSTRS.  Crane was appointed by Gov. Schwarzenegger but the appointment was not endorsed by the state senate and thus ended. 

In any event, the letter from Crane addressed to Gov. Brown – which his website says in today’s Sacramento Bee – seems to be part of the larger campaign for the initiative.  It was circulated on the website of (and by emails from) a group associated with Crane – Govern for California:  [excerpt]

…Governor, it’s long past time to act. By not addressing CalSTRS, California has already become the largest “deadbeat” state government, a term coined by The New Yorker to characterize governments not even paying minimally required pension contributions. Every day of additional delay adds millions of dollars to the next generation’s burden. If you don’t act, you are effectively defunding their classrooms, cutting their public services, and raising their taxes…

You can find the full letter at:
http://hosted.verticalresponse.com/990407/ff4a77211d/1660549029/358ab184e1/
or
http://www.governforcalifornia.org/an-open-letter-to-governor-jerry-brown/

Oddly, a search in today’s Bee (under Crane, CalSTRS, opinion, viewpoint, letters to the editor, etc.) did not find the letter.  It did find other earlier Crane-related items.  Among them was a recent article indicating Crane was involving himself in state legislative contests related to his pension interests.  See:

http://www.sacbee.com/2014/01/03/6045328/pension-activists-back-democrat.html

As we have noted in past postings, the chief UC interest in this matter is to be excluded from the proposed initiative and to leave funding of the UC pension to the university and (current) Regents.

UPDATE: Crane in a later post on Fox and Hounds no longer claims the letter appeared in the Bee.  See http://www.foxandhoundsdaily.com/2014/01/political-leaders-must-focus-calstrs-funding-crisis/

 

The Rewards of Good Behavior (and the penalties for the reverse)

With a possible pension initiative coming to the ballot, it would be nice if public pension plans stayed on Good Behavior.  Alas:

Federal investigators are looking into allegations that CalPERS violated insider trading laws this year when it purchased $26.6 million in restricted stock and then decided it didn’t need to reverse the trades when they were discovered. Two sources with knowledge of the Securities and Exchange Commission’s inquiry say on condition of anonymity that it involves stock purchases that the nation’s largest public pension fund made in March, including nearly $24 million in global financial firm JPMorgan Chase & Co. and almost $2.7 million in Access Midstream Partners LP, an Oklahoma-based energy company. 

According to an internal memo and a fired employee’s challenge of her termination by CalPERS, some staff at the fund contend that the purchases – and a subsequent decision not to rescind them – calls their managers’ qualifications and judgment into question. 

“We wanted to reverse (the trades),” said Ted Nishio, a retiree who worked in CalPERS’ Division of Enterprise Compliance who said he was fired after he told his boss that the fund should quickly act. “But the higher ups said, ‘Let it be.’ “…

Full story from the Sacramento Bee at http://www.sacbee.com/2013/12/28/6031076/security-and-exchange-commission.html

Were those higher ups, by any chance, named John, Paul, George, and Ringo?
[youtube http://www.youtube.com/watch?v=Y4zaofnVhps?feature=player_detailpage]

Read more here: http://www.sacbee.com/2013/12/28/6031076/security-and-exchange-commission.html#storylink=cpy

A Berkeley Admissions Dossier Reader Tells All

Yours truly confesses he missed an August 1 article in the NY Times concerning the UC-Berkeley admissions process (which undoubtedly applies to UCLA as well).  The article gets into the sensitive area of admissions in the post-Prop 209 era.  [Prop 209 bans affirmative action in admissions.]  Since you may also have missed it, here is an excerpt below with a link to the full article:

A HIGHLY qualified student, with a 3.95 unweighted grade point average and 2300 on the SAT, was not among the top-ranked engineering applicants to the University of California, Berkeley. He had perfect 800s on his subject tests in math and chemistry, a score of 5 on five Advanced Placement exams, musical talent and, in one of two personal statements, had written a loving tribute to his parents, who had emigrated from India…  The reason our budding engineer was a 2 on a 1-to-5 scale (1 being highest) has to do with Berkeley’s holistic, or comprehensive, review, an admissions policy adopted by most selective colleges and universities. In holistic review, institutions look beyond grades and scores to determine academic potential, drive and leadership abilities. Apparently, our Indian-American student needed more extracurricular activities and engineering awards to be ranked a 1…  when I asked about an Asian student who I thought was a 2 but had only received a 3, the officer noted: “Oh, you’ll get a lot of them.” She said the same when I asked why a low-income student with top grades and scores, and who had served in the Israeli army, was a 3. Which them? I had wondered. Did she mean I’d see a lot of 4.0 G.P.A.’s, or a lot of applicants whose bigger picture would fail to advance them, or a lot of Jewish and Asian applicants (Berkeley is 43 percent Asian, 11 percent Latino and 3 percent black)? …

Full article at mobile.nytimes.com/2013/08/04/education/edlife/lifting-the-veil-on-the-holistic-process-at-the-university-of-california-berkeley.html

If You Don’t Want to Talk to the Piper, Why Not Talk to the Piper’s Paymaster?

As blog readers will know, there is currently a potential ballot initiative on public pensions and other retiree benefits (health care) that as written sweeps in UC.  We won’t rehash why it would be best if UC was excluded – as it ultimately was from the governor’s pension bill.  But let’s just say for purposes of this posting that excluding UC would be a Good Thing.
At present, there is no rush needed to get signatures for 2014, or possibly 2016.  And we have suggested in the past that the folks in UCOP might want to talk to San Jose Mayor Chuck Reed who is fronting for the group behind the initiative. Reed might not listen, but what would be the loss?  Nonetheless, if for some reason talking to Reed is out, there is John Arnold, a Texas billionaire who is paying for the initiative.  A profile of Arnold appears in the Sacramento Bee at www.sacbee.com/2013/12/08/5977939/dan-morain-john-arnold-is-a-texas.htmland he is painted as a somewhat reasonably guy.  There is that old saying that he who pays the piper calls the tune.  So why not talk to the piper’s paymaster?
Who knows?  He might even want to talk:
[youtube http://www.youtube.com/watch?v=SNBqBN30IPM?feature=player_detailpage]

 

Clock is ticking away on chance to get UC out of anti-pension initiative

Previous posts on t his blog have noted the filing of an anti-pension initiative, fronted by some mayors, that would include UC along with other state and local plans.  We have noted that it would be best if UC were omitted from the initiative on the rationale that the Regents have implemented their own plan for modifying their retiree programs (back in 2010).

We have also noted that once an initiative gets on the ballot, it cannot be amended.  However, groups filing pension initiatives sometimes file amended versions.  The group behind the initiative has now filed a second version, illustrating this point.  Unfortunately, the second version still includes UC.  You can find the newer version at https://oag.ca.gov/system/files/initiatives/pdfs/13-0043%20%2813-0043%20%28Pension%20Reform%20V2%29%29.pdf

We note again that it would be wise for UCOP – although it is a long shot – to see if the group would consider removing UC from coverage.  But the clock is ticking.  If nothing else, such an approach to the group, even if unsuccessful, would allow it to be said in any campaign against the initiative that UC asked for the coverage omission, presented a sound rationale for the request, and was denied.

Response Would Be a Slender Reed (Pun Intended), But Why Not?

Prior posts on this blog have noted that there is an anti-pension initiative that has been filed by a group whose front man is San Jose mayor Chuck Reed.  The proposition, if it got on the ballot, would cover UC.  It would require plans do be drawn up, presumably by the Regents, to deal with retirement underfunding.  The plans would be different than what the Regents developed on their own in 2010.  In theory, the Regents could draw up the plans and ignore them.  That would create political problems for the Regents and UC, however.

Bottom line: We would be better off being removed from the ballot proposition.  There is plenty of time for the group to file a revised version that drops UC from coverage.  However, once a proposed ballot prop goes into circulation, it cannot be amended.

Note that there is plenty of rationale for dropping UC.  1) The Regents have acted.  2) The Regents have constitutional autonomy.  3) The group’s campaign seems to be based on problems municipalities are having (which is why mayors including Reed are the fronts) and UC is not a municipality.

As we have also noted, after the proposition was filed, Reed sent a letter to public sector unions asking them to discuss the issue with him.  Not surprisingly, they have rejected the invitation.  You can read about it the letter and the response at:
http://www.sacbee.com/2013/11/07/5891098/california-unions-to-san-jose.html

Although the original letter from Reed wasn’t addressed to UC, someone from UC might nonetheless respond and ask to discuss the three points above.  The worst that could happen is that there would be no response or a negative response.  Silence or a negative response, however, would provide an enhanced rationale for UC and the Regents to oppose the prop, assuming it gets on the ballot.  Is anyone at UCOP picking up the phone and responding to Reed?

Reed says he wants an answer:
[youtube http://www.youtube.com/watch?v=MuMtI8-qnVE?feature=player_detailpage]

Brown Joins Harvard in Rejecting Fossil Fuel Divestment

We have noted in previous posts that there is a student group that has been using the public comment period at the Regents to push for pension and other fund divestment of fossil fuels. (The demand involves both extraction industries and some utilities.)  It is part of a national student movement.  If you scroll back to our links to Regents meetings, you will be able to hear those demands.

Recently, as we have noted, Harvard rejected the demand.  See http://www.insidehighered.com/news/2013/10/04/harvard-rejects-call-divest-fossil-fuels.  Today, Inside Higher Ed is reporting that Brown University has also rejected it.  See http://www.insidehighered.com/quicktakes/2013/10/28/brown-u-rejects-call-sell-holdings-coal-companies.

Given the current anti-pension initiative about which we have also been blogging, any sense that the pension fund is being used for “political” purposes would be sensitive and likely something the Regents would avoid. 

Disclosure Decision Will Make It More Difficult to Hide Funding for Anti-Pension Initiative

You may recall the brouhaha that developed around secret funding by a group that opposed Proposition 30 (the governor’s tax initiative) and supported Prop 32 (an anti-union initiative).  It became an issue late in that election.  Large fines have now been levied by the California Fair Political Practices Commission.  While this development may seem like old political news, it will be relevant for whatever groups are pushing the anti-pension initiative about which we have been posting and which covers UC.  It will be more difficult – but not impossible – to continue to hide behind the friendly faces of a few California mayors, the stance taken so far.  Of course, some donors don’t care their names are known.  But apparently some do, since care was taken to launder the contributions in the anti-30/pro-32 campaign.

You can read more details and see a TV newscast about this episode at http://www.news10.net/capitol/article/261647/525/State-levies-16-million-fine-over-2012-mystery-campaign-cash

The Koch connection is highlighted at http://www.sacbee.com/2013/10/25/5850222/dan-morain.html

A press release from the FPPC is at: http://www.fppc.ca.gov/releasespdf/2013-10-24.pdf

UPDATE: The New Yorker picks up the story at http://www.newyorker.com/online/blogs/currency/2013/10/the-koch-brothers-in-california.html

The related FPPC press conference can be seen at the link below: [starts at minute 6:30]
[youtube http://www.youtube.com/watch?v=KeqryX8LiUU?feature=player_detailpage]