Gov. Brown, CalPERS face off in 2015

Gov. Brown, CalPERS face off in 2015

Calpers logoA piece of this year’s politics moving into 2015 is Gov. Jerry Brown’s tiff with the California Public Employees’ Retirement System. In particular, Brown remains steamed over CalPERS’ use of temporary pay to pad pensions. In a letter to CalPERS, he said the action “would improperly allow temporary pay resulting from short-term promotions to count towards workers’ pensions.”

Divisions on CalPERS’ Board of Administration, where Brown can count on allied appointees, opened around the controversy. Although Brown’s side in the controversy lost a close vote, plans have already been hatched for a rematch.

The bout has been a long time in coming. As summer turned to fall, Controller John Chiang took CalPERS to task for juicing up pensions while dishing them out at unsustainably high levels. Chiang was just elected state treasurer, so he will remain an ex officio member of the CalPERS board.

In late August, Brown tasked his team with doing all it could legally to prevent CalPERS from engaging in the pension spiking.

In that procedure, a public pension fund passes rules that allow pension levels to be adjusted significantly upward by taking temporary or exceptional kinds of work and pay into account. CalPERS had pushed the credibility of these measures to the breaking point, in effect securing special pension increases simply because employees did their jobs, such as librarians shelving books.

But Brown made a point to object only to CalPERS’ temporary pay rules, which allowed unique, fleeting raises for non-permanent work to be factored into pension setting.

By mid-September, Chiang had concluded that CalPERS’ pension spiking was unacceptable in theory, but unpunishable in practice. CalPERS’ “available resources” for spiking oversight, Chiang concluded, “limit its annual reviews to only 45, or 1.5 percent of the more than 3,000 reporting entities. At this current rate, pension spiking could go undetected for an extended period of time, as each reporting entity would be reviewed, at the earliest, every 66 years.”

The task of auditing CalPERS’ shenanigans had to fall, in other words, to the Legislature.

As a matter of common sense, it was much more attractive for Brown to try to exercise oversight by reforming the rules CalPERS used to set pensions, instead of by pouring the state’s time and energy into auditing those rules after scores of changes went into effect.

A tough matchup

That is why, as the Sacramento Bee reported, Brown’s appointees on the CalPERS board proceeded to force a vote on removing temporary pay from the fund’s cornucopia of pension-spiking sweeteners. Unfortunately for Brown, the vote failed, splitting 7-5 in favor of retaining the objectionable rule.

In an interview, state human resources head Richard Gillihan — a Brown ally on the board who voted against temporary-pay pension spiking — told the Bee that 2015 would offer another shot at reform. “What should or shouldn’t be included in final compensation is absolutely something that we think needs broader revisitation,” he said. “We hope to see that sooner rather than later.”

According to the fund’s website, “The CalPERS Board of Administration consists of 13 members — six elected ‘member representatives,’ three appointed representatives, and four ‘ex officio’ representatives. The elected candidates will serve a four-year term and represent active and retired members in all aspects of CalPERS’ business – including benefit and membership issues, and oversight and investment of Fund assets.”

But as the Bee observed, “The board’s composition will lean more heavily toward labor’s interests next year.” The Service Employees International Union shelled out some $250,000 to secure the election of incoming member Theresa Taylor.

Even though California taxpayers are on the hook for any CalPERS shortfall, they have no say in the six elected “member” representatives. Those representatives are chosen, according to CalPERS, by ballots “mailed to eligible, active state and public agency CalPERS members.”

Leadership trouble

A complication, however, has added further difficulties to the equation. September also saw the board approve the appointment of Ted Eliopoulos, former CalPERS senior investment officer for real estate, as its new chief investment officer.

That provoked the ire of J.J. Jelincic, a board member unable to vote against Eliopoulos because he was recused for being on leave. Jelincic told Pensions and Investments that Eliopoulos lacked “the temperament and management skills” needed for the job.

Pensions and Investments noted, “He said Mr. Eliopoulos relied 四人打麻将 too much on the advice of consultants, made the wrong decision to increase CalPERS’ exposure to riskier non-core real estate assets before the financial crisis, and played favorites with employees.”

The enmity has served to cloud Brown’s prospects even further for charting an effective course toward CalPERS reform.

46 comments

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  1. Ronald Stein
    Ronald Stein 5 December, 2014, 10:20

    The inmates are running the Asylum. The major problem is that most current public employees are guaranteed defined-benefit plans, under which their benefits are guaranteed no matter how well, or badly, the underlying pension investments perform.

    Public sector contracts negotiated by public sector employees that hammer out a contract that forces under duress a third party, taxpayers, to cough up the necessary dough, doesn’t seem too pass the smell test. In fact, it more closely resembles racketeering. Any challenges to that “racket” would be heard before judges who have pension and benefit package they want to protect. Again, seems like a racketeering cover-up right before our public eyes.

    Reply this comment
    • SeeSaw
      SeeSaw 5 December, 2014, 23:30

      Well, I can tell you that the plan is staffed with investment managers and actuaries that see to it there is a plan for bringing in returns and the 20-year average for CalPERS is 8+ percent. There are no people running an asylum–they are providing the public services that you use everyday! Contracts are arrived at through a process of negotiation–I suppose you must think everything is done at the point of a gun!

      Reply this comment
      • igolf
        igolf 6 December, 2014, 20:10

        The problem is that the taxpayers do not have a seat at the negotiating table. The public sector unions are negotiating with representatives their money elected and will go along to get re-elected.

        Reply this comment
        • SeeSaw
          SeeSaw 7 December, 2014, 10:39

          If you know of a better way, bring it on. I worked for a municipality where 99% of the employees are not residents–so there is no danger that any elected council person is going to suffer from a lack of those votes. All negotiated contracts are put forth publicly before approval and agendas must be available to the public several days before a meeting–you cannot say that you did not have a voice.

          Reply this comment
          • Inzidious
            Inzidious 7 December, 2014, 17:59

            SeeSaw – let me guess, cushy public sector job right? Fireman’s assistant to his associate maybe? 100k+ a year with pension to shuffle their playing cards for them when they can’t be bothered? And you’re arguing to continue that status quo? Shocking.

            Let me even go a step further – your union bosses encourage/pay you out for trolling random forums with this trash? Thank god us people who have to actually pay to support this garbage are beginning to wake up and understand that you’re taking a government check, and will do (and vote) how the hand that feeds you tells you to. Even if it is far too late to do anything about it. In few years or so a year a judge looking to retire and make a legendary name for himself is going to tell Calpers to go to hell, and then you’re all screwed. We’re screwed too, but you guys will choke first, and I cant wait to sit back and watch it all come down.

    • NTHEOC
      NTHEOC 6 December, 2014, 12:49

      Hey Ronny, how about the private sector that hammers out gov’t contracts! I especially like the ones that whine and dine , give away front row laker tickets, or just happen to know someone and secure big money contracts! It is what it is Ronald so go on about your business and stop worrying about it… Happy Holidays……

      Reply this comment
    • Pension Ponzi
      Pension Ponzi 7 December, 2014, 13:03

      The troughers have to drive over the same bridges as the rest of us. Did you see the “60 Minutes” about crumbling bridges in Pittsburgh?

      Reply this comment
    • Chris
      Chris 2 July, 2016, 11:14

      Your right.
      Don’t forget the COLA of 2-3 percent they get each year. My relative was a teacher and retired with a guaranteed pension of 113k. He is now making well over 125k.
      These greedy teachers are breaking the state!!!!

      Reply this comment
    • Nick
      Nick 2 July, 2016, 11:23

      CalPERS is the main reason our California schools and teachers are so bad now. Teachers don’t want to retire and want to be lifers or are in it for the money and pension spiking. #Corrupt #Greed
      http://www.wsj.com/articles/how-young-teachers-pay-for-those-who-wont-budge-1442272299
      http://forums.atozteacherstuff.com/index.php?threads/is-it-hard-to-find-a-teaching-job-especially-in-socal.106186/

      Reply this comment
  2. Dork
    Dork 5 December, 2014, 15:05

    California taxpayers are on the hook for any CalPERS shortfall,

    When I was a kid we called this Involuntary Servitude.

    they have no say in the six elected “member” representatives

    When I was a kid we called this Taxation without Representation

    This is not going to end well folks, No matter what people say even the real smart ones like Moonbeam, Math always Wins.

    Reply this comment
    • SeeSaw
      SeeSaw 5 December, 2014, 23:23

      Stop making yourselves look so stupid!! The elected member representatives are elected by the members who happen to be taxpayers! The representatives don’t make the tax laws–they just approve or disapprove of the material put before them by the staff of CalPERS. It is not taxation without representation–you either elected the representatives in the Legislature who passed said taxes or you voted in a tax in your, respective, voting district. If you want to have public services like roads, water, code enforcement, public safety, trash collection, you have to pay for it! If you don’t like it, move to a desert island!

      Reply this comment
  3. Dork
    Dork 5 December, 2014, 15:13

    “seems like a racketeering cover-up right before our public eyes”

    Seems Like?? You aren’t seriously just now coming to this conclusion are you?

    You don’t really believe we have any less than honest Judges do you??
    http://www.jail4judges.org/News_Letters/2008/NL_2008-10-27.html

    Reply this comment
  4. T Mind of Ted Your God
    T Mind of Ted Your God 5 December, 2014, 16:37

    Where the heck are the two usual trolls Poodle-Girl and Duncey-Girl????? they need to get some talking points out here asap RagWis?

    Reply this comment
  5. bob
    bob 5 December, 2014, 17:03

    How dare Brownie pull something like this. It makes no nevermind, though. The unions will get what they want anyway.

    Doesn’t Brown know these dedicated workers earned every penny??? And a promis is a promise.

    There is no funding problem with these pensions, just ask Douglass, he’ll give ya all the numbers. And if there is it is the responsibility of the taxpayer to pay up. Just ask Douglass, he’ll give you the law straight up.

    If anything these workers need bigger pensions. After all, in Colliefornia our gummit workers are every bit as dedicated as these Illnoise gummit workers.

    https://www.youtube.com/watch?v=OdREEcx0-Qc

    So bigger pensions for all! And if we could just repeal prop 13 we could get pensions for the undocumented!

    Reply this comment
    • SeeSaw
      SeeSaw 5 December, 2014, 23:39

      You obviously were not sent to school by your parents–poor child!

      Reply this comment
      • bob
        bob 6 December, 2014, 19:07

        So you’re NOT for pensions for the undocumented? What are you, some kind of racist?

        And how dare you. I’m a proud product of the gummit skoolz…in fact the lady in that video above was one of my teachers!

        Reply this comment
        • SeeSaw
          SeeSaw 6 December, 2014, 20:24

          You don’t give any evidence to show you were ever educated–you haven’t even gotten past the first grade in spelling!

          Reply this comment
          • Rex the Wonder Dog!
            Rex the Wonder Dog! 6 December, 2014, 21:22

            “…you haven’t even gotten past the first grade in spelling! “
            LOL… oh seesaw…. TY 🙂
            That was hilarious… of course I “haven’t gotten me coffee dis morning”

          • T Mind of Ted Your God
            T Mind of Ted Your God 6 December, 2014, 21:33

            Poodle Girl!

            Typo spotter!

            Good Girl Internet toughie! Hi Yaaaaaaaaaaaaaaaaaaaaaaaa! Karate!

          • S Moderation Douglas
            S Moderation Douglas 7 December, 2014, 09:19

            Puppy hasn’t even gotten a decent dictionary.

  6. ECK
    ECK 5 December, 2014, 18:48

    Love it. Jerry is opposing the union, bottom feeders. We know who will be “assimilated”, don’t we.

    Reply this comment
    • SeeSaw
      SeeSaw 7 December, 2014, 10:43

      I hate to break it to you ECK–our Governor is a pragmatic man. That is why he gets so much done. But, brace yourself–he is a Democrat!

      Reply this comment
  7. ECK
    ECK 5 December, 2014, 18:56

    Also, why, in any sane world, would “six elected ‘member representatives” have any say in their publicly funded pensions!! It really is bizarre. They should have ZERO input. They’re not paying. I wish I could get my hands on the throat of every dingbat legislator that voted for this nonsense.

    Reply this comment
  8. Queeg
    Queeg 5 December, 2014, 19:46

    El Clipped is trolling as Timbrrrr with sour shorter dirges.

    Donkey at Dennys using up his discount chits before year end.

    Poodle working pfeverishly both the corn dog station and pretzel salt box at the Adelanto truck stop…..awesomr/productive multi tasking. The poor lad is strained…..pity!

    Reply this comment
  9. Angus
    Angus 6 December, 2014, 06:49

    Won t it be great when all employees in a state office building are eaten by the unwashed masses? Save your Ebt cards, eat a state worker.

    Reply this comment
    • SeeSaw
      SeeSaw 6 December, 2014, 11:45

      Real human beings are being beheaded in other parts of the world, and you try to make jokes here about causing harm to public workers!! You should be ashamed of yourself! You should give thanks that you live in the US of America and the State of CA. You are surrounded by friends and neighbors, some of who are public employees!

      Reply this comment
      • T Mind of Ted Your God
        T Mind of Ted Your God 6 December, 2014, 12:01

        Should I give back my pension money? I am 80 this year and the checks just keep on coming. I have been retired almost 20 years! I guess calpers will go bust very soon…….lmao—————mery xmas trolls!

        The Ted

        Reply this comment
        • NTHEOC
          NTHEOC 6 December, 2014, 12:59

          Calpers will never go bust!!! Never! But their will always be corporate raiding pigs that want to steal it. That’s why they love the 401ks, the pigs can dip in and steal a little from the workers whenever they want. I wish every Californian public or private could be a part of Calpers somehow. But they do have social security and we don’t. Equality for all……….

          Reply this comment
    • Pension Ponzi
      Pension Ponzi 7 December, 2014, 13:00

      Retirees in Stockton and Detroit lost their COLAs and health benefits. LOL That’s good enough for me.

      Reply this comment
  10. NTHEOC
    NTHEOC 6 December, 2014, 13:01

    Love my [email protected]!! Happy Holidays trolls!!!!!!

    Reply this comment
  11. Angus
    Angus 6 December, 2014, 13:58

    See Slaw, I do not make jokes. I am very, very serious. What is an unreal human being? You do not know much about history, if you think humans eating other humans for survival is a remote possibility. What do you think would happen if the electricity went out, the faucets ran dry? You are a pompous ignorant organism. Your kind will be food.

    Reply this comment
  12. Queeg
    Queeg 6 December, 2014, 15:50

    Anus

    Stopped the crap.

    Reply this comment
  13. Angus
    Angus 6 December, 2014, 16:25

    Ho, ho, tough guy. Mind your own business. Of course, you are probably just an old fool who has nothing else to do, but pretend you are the boss. The Sow is righteous, pompous, who adds a profound degree of selfish nothing to its comments. Dint have a lot of patience for righteous ignorance.

    Reply this comment
  14. SeeSaw
    SeeSaw 6 December, 2014, 19:12

    Your subject matter is atrocious! We should be talking about how to get along as human beings, not about eradicating each other. I am an everyday type of person–not a pompous bone in my body. You are the one who is pompous and self- righteous!

    Reply this comment
    • ricky65
      ricky65 6 December, 2014, 20:21

      Sounds like Angus is the type of person who enjoys people—especially if they’re properly cooked.
      Perhaps he should travel up to the state capitol. Plenty of legislators and other elected officials who have fattened themselves up nicely at the public trough.
      Stay hungry my friend!

      Reply this comment
  15. T Mind of Ted Your God
    T Mind of Ted Your God 6 December, 2014, 21:30

    Pretty childlike ricky— I suppose you’d want Seesaw to respond in kind regarding death or violence?

    Predictable kid stuff….Zzzzzzzzzzzzzz

    Reply this comment
  16. angus
    angus 7 December, 2014, 09:03

    Forgot to mention obstinate. Good night Chet.

    Reply this comment
  17. T Mind of Ted Your God
    T Mind of Ted Your God 8 December, 2014, 20:18

    Good Night David

    Reply this comment
  18. S Moderation Douglas
    S Moderation Douglas 9 December, 2014, 10:52

    Thanks, Ted. I was waiting for that shoe to drop.

    Reply this comment

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