TEAPAC FIRST FRIDAY BREAKFAST FORUM Making California Golden Again: Taking California into the 21st Century
Over the next ten months, we will be hosting presentations from policy experts to look at where we are, where we have been and where we need to go in California in the 21st Century.
Please Join us for a presentation by John Harrington, Esq. Staff Counsel, Los Angeles Employees Retirement Association Councilmember, City of San Gabriel October 7, 2016
“California's Pension Crisis from the Perspective of a City Councilman and Pension Expert”
At our next Breakfast Forum on Friday, October 7, John Harrington will discuss California's pension crisis from the perspective of not only someone who works for a public employee pension fund handling investments and transactions, but also of a city council member with fiduciary and fiscal responsibilities. Mr. Harrington is an attorney, a pension professional and investment expert. He is uniquely qualified to speak on this subject, and you will find his perspective to be invaluable.
The TEAPAC Team
I am writing to remind you and encourage you to attend our next "First Friday Forum" this Friday, October 7, 2016 at 7:30 AM at the Pasadena Hilton. [See table below for details.] Our guest speaker will be San Gabriel City Councilman, John Harrington. John is an attorney who has worked for the last several years for LACERA, the Los Angeles County Employees Retirement Association.
We have all heard of CalPERS, the giant California Public employees retirement system with 1.8 million (gasp!) members. Many of us also know about the other large retirement systems such as CALSTRS, the California State Teachers Retirement System, which has almost 870,000 members as well as UCRP, the University of California Retirement Plan that manages retirement funds for its 225,0000 members.
In addition to these large statewide systems, there are a number of cities and counties that manage their own retirement (aka pension) plans. Among the largest is LACERA, which manages pension and retirement benefits for over 162,500 county employees and currently provides benefits to over 61,000 retirees. With over $50 billion in investments, it is one of the largest retirement plans in the country.
Despite the vast amount of assets on hand, the pension plans in California are critically underfunded. Although experts disagree, most agree that California's retirement plans are underfunded by at least $1 trillion dollars. In other words, government entities need to set aside at least another $1 trillion dollars in the near term to ensure that they will be able to meet just the current commitments. This assumes that they do not hire anyone else, that they don't work any longer, retire sooner or die later. This unfunded, unpaid retirement debt poses a mortal threat not only to the state but to the cities and counties as well. If we continue on our current trajectory, the retirement shortfall will continue to grow. Sooner or later this shortfall will require cities to raise taxes and/or reduce services. Unless checked, these pension contributions will soon account for over 30% of municipal budgets and rise from there. The "quality of life" that so many cities brag about will evaporate as they are forced to make good on the extravagant promises they have made to public employees.
The best single source of information on the pension numbers for your city will be found at www.PensionTracker.org. You will be shocked by what you read there. For example, the City of Glendale admits that they owe their pension plan $450 million right now. But the read number is probably closer to $1.5 billion.
As a sitting city councilman, attorney and pension plan professional, John Harrington is uniquely qualified to discuss these issues. He prefers and enjoys a Q&A format, so bring your questions along with a friend and join us as California 21 explores solutions to this and other critical problems facing California in the 21st Century.
I look forward to seeing you on Friday. Huzzah! Mike Alexander President