LA Need not Sacrifice Public Safety
Today’s LA Times reports the city is looking at layoffs of police officers because of a budget shortfall. But as we explain here, LA could save nearly $400 million per year by eliminating a rich subsidy for retired city employees that was rendered redundant by subsidies provided by the federally-funded Affordable Care Act in 2010 […]
Pension Obligation Bonds Are Not the Answer to Pension Crisis
Pension Obligation Bonds (POBs) do NOT reduce pension obligations. They increase pension assets, which produces an accounting benefit (more assets — the same liabilities = a lower unfunded liability). Economically, a POB is just a “carry trade,” which is a borrowing at a low rate to bet on hopefully-higher-yielding products. Not surprisingly, Wall Street also […]
California’s COVID-Resistant Tax Revenues
October General Fund tax revenues came in 37 percent above the 2020-21 Budget Act forecast, according to the latest Finance Bulletin from the California Department of Finance. Revenues through the first four months of the current fiscal year now exceed forecast revenues by $11 billion: Revenue collections from March, when the state’s COVID-19 state of […]
NY Times Says CA “Sorely Needs Revenue.” An Analysis
A recent article in the New York Times about election results in California included the following sentence (underline added by me): “A measure that would have raised taxes on commercial landlords to raise billions for a state that sorely needs revenue also seemed on track for defeat.” The reporters did not provide support for their […]
LA Can Save $398 Million Right Now
Friday, LA’s City Administrative Officer announced the city’s budget deficit could reach $400 million to $600 million by the end of the current fiscal year. According to page 201 of LA’s Comprehensive Annual Financial Report, LA spends $398 million per year supplying health insurance subsidies to retirees under the city’s other post-employment benefits (OPEB) program. […]
California’s Tax Revenue
According to the October Finance Bulletin issued by the Department of Finance, California’s tax revenues in September were 43 percent greater than forecast by the 2020-21 Budget Act enacted in June. Revenues for the first three months of the current fiscal year are now $8.7 billion greater than forecast. That’s good news for programs worried […]
San Francisco’s Retirement Spending
When we’re not studying state finances we read financial reports issued by cities and school districts. Recently we took a look at the City and County of San Francisco where annual cash spending on pensions and other post-employment benefits (OPEB) more than doubled from 2010 to 2019: Unfunded liabilities more than tripled to $8.3 billion:
Sacramento Pension Spin
When I started focusing on California pension matters in 2005 I quickly learned that Sacramento is a company town. The company is government and in place of shareholders are government employees who spin financial and legal fictions about pensions to journalists living inside the same beltway. Journalists at that time generally bought the spin but […]
California Must Do Better in Delivering Services
Dear Legislators, We are increasingly concerned about poor performance of critical state services. According to the US Department of Labor, in June only 52 percent of First-Time Claims for unemployment in California were addressed within 14 days and according to the San Francisco Chronicle, teachers at San Francisco Unified School District have been given no […]
In Support Of More Prison Reforms In California
Nearly five decades ago, elected officials in California started enacting sentencing laws that rapidly filled the state’s prisons. Only in the last decade did that process start to reverse. Effecting political change is not for people with short attention spans. Momentum for reform continues and Govern For California has been pleased to support organizations like […]