pension

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Will There Be a Pension Lawsuit Over the Cap for the Highly Paid?

Byuclafaculty

The upcoming Regents agenda contains a mix of open sessions and closed sessions.  One closed session involves a sensitive pension issue to be discussed in private by the Committee on Compensation. Readers of this blog with long memories will recall a controversy that erupted when certain highly-paid UC administrators complained that a cap – based on IRS rules – on their pensions should be removed.  The cap limits the amount of the basic pension to the first $245,000 of pay.  Essentially, back in the day when folks didn’t worry much about pension funding, the Regents applied for an exemption from…

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On Our Level

Byuclafaculty

CalPERS’ governing board voted to cut its earnings forecast to 7.5%, the same level assumed in UCRP. There were earlier reports, as readers of this blog will know, that CalPERS would cut below us to 7.25%. If CalPERS had dropped below UCRP, the Regents might well have reduced their forecast. As noted in earlier posts, changing the earnings forecast does not change the future actual earnings.  The future will be what it will be. But lowering the forecast increases the estimated unfunded liability and could thus trigger higher contributions or some other adjustment. We will see at the upcoming Regents…

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President Yudof Responds to Three Pension Questions

Byuclafaculty

On March 2, President Yudof answered questions in a live-streaming format from UC employees.  You may have received an email referring to an edited version of some questions – including three on pensions – that appeared in UCLA Today.  Because the UCLA Today versions were edited, some nuances on pension issues were lost. Below is the UCLA Today version in regular type and then a comment from yours truly and the actual transcript in italics.  Also, the audio (a video with a fixed picture) is at the bottom of this posting along with various links. Question: What is the impact…

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Ah Ha! State Beginning to Acknowledge UC Pension Liability Claim

Byuclafaculty

The State of California is about to sell $2 billion in general obligation bonds.  To do so, it must issue a prospectus detailing the terms of the bond but also the fiscal condition of the state.  The prospectus that has been issued on a preliminary basis includes information on other state liabilities including pensions.  Much of the information is about CalPERS and CalSTRS.  However, the disclosure contains the following statement on page A-82 (which is pdf page 122 at the link towards the bottom of this blog entry): “The University of California maintains a separate retirement system. The state’s General…

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New Twists in the Pension Debate

Byuclafaculty

As readers of this blog will know, the governor came up with a 12-point plan for all public pensions in California that would include UC.  To get certain elements of the plan on the ballot, he needs a 2/3 vote of the legislature.  That would require Republican support. In this case, however, the Republicans have pledged support and it is the Democrats who are reluctant.  If all Republicans go along, Governor Brown would need about half of the Dems to go along.  But so far that doesn’t seem to be happening. The Dems are pushing a plan whereby – as…

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Anti-Pension Group Admits it Has No Money for its Ballot Initiatives

Byuclafaculty

A group pushing ballot initiatives that would have swept UC into a statewide pension formula turns out to have no money for signature gathering. Excerpt: A conservative group announced Wednesday that it was suspending its campaign to put public employee pension reform on the November ballot.  Dan Pellissier, president of California Pension Reform, said his group could not raise enough money to mount a petition-signature drive. A successful drive typically requires at least $2 million…  “California Pension Reform is suspending its effort to qualify an initiative for the 2012 ballot after determining that the attorney general’s false and misleading title and…

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LAO Report on Higher Ed Contains Significant Pension Recommendations

Byuclafaculty

The state’s Legislative Analyst has released a lengthy report on funding higher education which covers UC, CSU, and the community colleges (as well as CalGrants).  The report is essentially a response to the governor’s January budget proposal with regard to higher ed. Generally, the report tends to disagree with the governor’s approach which the Legislative Analyst views as giving too much autonomy to UC and the other segments with regard to enrollment and other matters.  On the other hand, it documents the trend towards reduced state funding and thus seems to continue the pay-less/say-more approach which is odd on its…

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More History Lessons (from Faculty Association Chair Dwight Read)

Byuclafaculty

As Chair of the Faculty Association at UCLA, I would like to emphasize again the point that was made in the Saturday, Jan. 21, 2012 Blog on this site, “Plenty of Nothing.” The Governor wrote in his proposed budget: “The University of California (UC) will receive an increase of $90 million from the General Fund for base operating costs, which can be used to address costs related to retirement program contributions.”  The main purpose of the public employee retirement law (PERL), passed in 1931, was to separate pension funding from all other kinds of funding. Early on, the state recognized that…

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We Missed the Boat on Pensions With the Governor: Time to Talk to the Legislature

Byuclafaculty

We missed the boat when it came to getting the governor to exempt UC from his statewide pension plan.  His plan, which now goes to the legislature, includes UC explicitly (p. 13), involves a hybrid plan (defined benefit plus defined contribution) for new hires, and has a 75% cap on retirement benefits. A summary of the plan: The changes would kick in Jan. 1, 2013. Labor agreements that contradict the governor’s plan would prevail until the pacts expire. The statutory language includes these proposals:• Ends additional retirement service credit purchases, or “airtime.”• Forfeits all or part of pensions for elected…

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UC Needs to Get Off the State Pension Train Before It Goes Too Far

Byuclafaculty

As we have noted many times, the Regents modified the UC pension plan back in December 2010 to deal with its funding issues.  Since that time, the risk has been that UC would be swept into some statewide pension reform really aimed mainly at CalPERS and CalSTRS.  UC needs to get off that train before it is too late. The excerpt below from a recent news report indicates that the train is rolling and so far we are on board. UCOP and the Regents need to be involved in legislative discussions. …At a hearing of the Legislature’s Conference Committee on…