pensions

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Follow Up: GASB proposals could stir things up for UCRP via CalSTRS

Byuclafaculty

Yesterday, we noted proposed changes in public pension accounting rules by GASB, the Governmental Accounting Standards Board. An observation from Academic Council Chair Robert Anderson, added to that blog note, indicated that the GASB proposal would not have a direct impact on UCRP. However, the problem facing UCRP is partly political. As prior blog posts have noted, the governor is planning some kind of pension proposals – apparently requiring a ballot proposition. Such a proposition, depending on how it is worded, could sweep UCRP into a statewide change, even though the Regents enacted their own pension modifications in December 2010….

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Buried Lede on Retiree Health?

Byuclafaculty

From Wiktionary “bury the lede” (idiomatic, US, journalism) To begin a story with details of secondary importance to the reader while postponing more essential points or facts. http://en.wiktionary.org/wiki/bury_the_lede ==== An article in today’s calpensions.com indicates that both CalPERS and CalSTRS have asked GASB – the Governental Accounting Standards Board – for a delay in its proposed new rules on public pension accounting. The rule would allow public pensions such as UCRP to continue with their projections of earnings on their assets (7.5% for UCRP) but would require a much lower discount rate for unfunded liabilities. The net effect of the…

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Pension Train Is Leaving the Station

Byuclafaculty

The Legislature has formed a joint committee to hold meetings around the state on public pensions. As noted in a prior blog post, the governor seems to be formulating his own proposal which he says will involve constitutional changes and need a vote of the electorate. On the joint committee: Legislative leaders have named six lawmakers to a joint committee that will hold hearings on changes to public employee pension systems. Assembly Speaker John A. Pérez has appointed Michael Allen, D-Santa Rosa, Warren Furutani, D-Gardena and Jim Silva, R-Huntington Beach. Senate President Pro Tem Darrell Steinberg has appointed Gloria Negrete…

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Gov. Brown Says Pension Proposal Will Involve Constitutional Changes & a Vote of the People

Byuclafaculty

At the Milken Institute State of the State conference today (attended by yours truly), Governor Brown was asked by Michael Milken about public pensions in California. (Cell phone photo of conference event at right.) Brown indicated he was working on a proposal on pensions – but did not give a precise date when it would be unveiled. He did say that it would involve a constitutional amendment that would have to be approved by a vote of the people. It was unclear what the coverage of the pension proposal would be. All state and local pensions in California? Just state-level…

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Piggy-Back

Byuclafaculty

Can UC piggy-back on CalSTRS? We are “education,” too. And we have pension funding issues. If you don’t ask, you surely don’t get. See below: CalSTRS reported ready to seek more state funding Sacramento Bee, 10/11/11, Dale Kasler For more than two years, CalSTRS has been talking about asking state lawmakers for more money to plug its funding gap. Now the teachers’ pension fund believes the Legislature is ready to listen. Pension fund Chief Executive Jack Ehnes said last week he wants Gov. Jerry Brown to include additional CalSTRS funding in a long-awaited pension reform proposal he’s expected to release…

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Looks Like Crane Won’t Fly

Byuclafaculty

From the LA Times’ LA Now blog: San Francisco businessman David Crane’s brief term as a UC regent seems likely to be over in December because Democrats in the state Senate have not moved to confirm his appointment nine months ago by former Gov. Arnold Schwarzenegger. Under state rules, an appointee to the university board can serve up to a year without legislative confirmation. The state Senate is now in recess and no special session is scheduled for the rest of the year. Crane, a Democrat who was an economic advisor to Schwarzenegger, a Republican, is opposed by labor unions…

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Making Money?

Byuclafaculty

Above are two charts prepared for the Regents meeting which show the rates of return for various investment funds. You can see on the lower slide that UCRP (pension) has earned around 5% per annum over the last ten years ending June 30, 2011. That is less than the assumed rate of 7.5%. The upper slide shows an annual rate of 9.35% over twenty years, above the assumed long-term 7.5% rate. (Also shown on the lower slide are the rates for the GEP = General Endowment Pool and the STIP = Short Term Investment Pool.) The full set of charts…

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Some Time – But Not Too Much – Can Go By on Pensions

Byuclafaculty

As has been stressed ad nauseum on this blog, UC could be swept into some statewide pension changes which would override the Regents’ action of December 2010. The legislature seems to be giving UC a bit of time to have some influence. See below: Lawmakers essentially threw in the towel Thursday on comprehensive public pension reform – at least for now. With this year’s legislative session scheduled to end at midnight today, the Assembly voted 51-21 to approve a last-minute bill declaring its commitment to pension reform but conceding that more time is needed. …The measure reads: “This bill would…

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Zen Vetoes

Byuclafaculty

Governor Brown has been vetoing and signing. Among the vetoes were two that would have made commercial initiative signature gathering more difficult. One was a ban on paying signature gatherers by the signature. They would have then been paid by the hour which would have changed the incentive structure in a way that would have undermined name gathering. In theory, they would have sat in front of supermarkets and watched the clock tick rather than annoy people into signing. And he vetoed another bill that would have required signature gatherers to wear large badges saying they were being paid. Presumably,…

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What Does Crane’s Proposed Grand Bargain Mean for UC?

Byuclafaculty

Regent-designate David Crane – a late appointment by Gov. Schwarzenegger who has yet to be confirmed (or not) by the state senate – has pushed various versions of pension reform. In an op ed today in the Sacramento Bee, he seems to be appealing to the current governor. Whether that will carry any weight in the state senate is not clear. Basically, he wants a “Grand Bargain” on a corporate tax change – which Gov. Brown has pushed – in exchange for pension reform. Crane says nothing specifically about the UC pension, however. Is he just talking about CalPERS and…