San Francisco Officials Are Chasing Rabbits

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

San Francisco’s pension costs are expected to rise three times faster than revenues over the next five years (see “Even San Francisco, Flush With Tech Wealth, Has Pension Problems,” Bloomberg) but another disclosure in the city’s latest Five-Year Financial Plan is equally troublesome: Pension costs, which had already increased 5x in the ten years to FY2015, were […]

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LAUSD and Detroit Have This In Common: Pension costs will be higher than projected

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

Last month Detroit mayor Mike Duggan claimed he had been kept in the dark about calculations used during Detroit’s 2014 bankruptcy proceedings to predict future pension payments. Realizing now that payments will be much higher than projected, the mayor is considering a lawsuit because “we did not know that [the projections] were based on optimistic […]

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Big Changes In California’s Spending

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

Jerry Brown just proposed his sixth budget since taking office in January 2011. Boosted by a bull market and tax rate increase, General Fund revenues are budgeted to be 32% higher than the fiscal year in which Brown took office. But not all spending has kept the same pace: FY2010–11 Enacted Budget; FY2017–18 Governor’s Budget […]

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For Whom the California Budget Tolls

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

Journalists and elected officials occasionally make the mistake of viewing budget problems in terms of size rather than where the budget item falls. For example, the costs of unfunded pensions and retiree healthcare in the current fiscal year (FYE16–17) add up to 6% of the state’s General Fund, a much smaller share than retirement spending […]

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Fix Medi-Cal Or Lose UC and CSU

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

As a new Congress takes office, newspapers are filled with articles about the potential consequences for California of federal changes to Medicaid but not about how California’s existing version of Medicaid — known as “Medi-Cal” — is already in need of serious reform. Medi-Cal is a single-payer healthcare entitlement program covering 13.5 million low-income Californians. Funded jointly by the state and the […]

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Next Generation Is On CalPERS’s Menu

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

“If you’re not at the table, you’re probably on the menu.” — Dave Low, Executive Director, California School Employees Association “Pay now or pay more later.” — CalPERS board member Richard Gillihan, appointed by Governor Jerry Brown The CalPERS board is considering a recommendation to lower its investment return assumption to 6.1%. That would mean higher pension costs […]

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Public Pension Costs: Potential Good News for Californians

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

The California Supreme Court has decided to hear the MCERA case, which as explained here potentially is good news for citizens. Now citizens should turn their attention to CalPERS’s board, which in February will decide on its consultant’s recommendation to use a 6.1% investment return assumption when establishing pension contributions. That decision will have a big impact on citizens […]

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Time For CalPERS To Lead

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

According to a recent article, the California Public Employees’ Retirement System (CalPERS) is considering a meaningful reduction in the investment return it assumes when establishing pension contributions. Future generations should hope CalPERS’s board makes the change. Public employee pension costs are supposed to be shared by employees and citizens. Together they contribute money when pension […]

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California’s Governors Should Send Their Kids To Public Schools

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

Citizens feel confident President Obama would never move himself and his family to another country for their safety. National security is the #1 presidential responsibility. Citizens expect presidents to experience the consequences of their leadership in that regard. In California, K-12 education is the #1 gubernatorial responsibility. It’s the first and largest category in the Governor’s […]

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The Ultimate Recipients of California’s State Spending

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

California’s General Fund will spend $122 billion this fiscal year. The state budget illustrates that spending in the following manner:             But that chart doesn’t show WHO pockets that money. Looked at that way:

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