[This 9jun15 email from my friend Rich Ulery is reprinted here with permission. Mr Ulery is active in local affairs, is the former chairman of the Nevada County Republican Party, and now serves on its Executive Board. He also chairs the Citizens Oversight Committee of NCCFD. This report is germane to reignite discussion of the county’s unfunded pension liabilities, long an issue of interest at SESF and RR. When compared ot the state’s unfunded liabilities, our amounts are small. However, when we compare what we will owe to our ability to pay, our unfunded liabilities are overwhelming. gjr]
Rich Ulery
As you know, while I keep up with the local blogs, I have intentionally refrained from commenting. I did notice your 8 June 10:30 AM comment (see below) in the latest sandbox about George Boardman's article on unfunded pensions.
I attended the 2June15 Board of Supervisors meeting during which Martin Polt presented the 2015-16 preliminary county budget totaling $201 million. County pension plans are now funded to the tune of 66% in the miscellaneous category and 72% in the safety category — below the total CalPERS funding ratio, currently estimated at 77%. The most shocking tidbit offered was the current Nevada County unfunded liability, which is now estimated at $190 million — over double what I had previously believed. I addressed the board about this situation and referenced a recent article in "Calpensions" which spoke of the ratio of active workers to current retiree annuitants. In California, the ratio has dropped from 2:1 in 2002 to 1.45:1 in 2012 and expected to drop to to well under 1:1 over the next couple of decades — putting even more pressure on the unfunded situation. Nevada County, by the way, is already under the 1:1 ratio, currently having more retiree annuitants than active employees.
The article also mentioned that the few remaining corporate defined benefit programs are generally using a 4% discount rate while, as we know, CalPERS is still at 7.5%. Supervisor Anderson asked me if I was recommending that the county consider using a 4% rate in its efforts to set aside reserves to address the unfunded liabilities. I responded that if that were the case, the liabilities would explode to around $350 million. The county would be unable to make a dent without significantly impacting its ability to deliver services. Addressing underlying benefits was the only prudent way. The meeting to approve the final 2015-16 budget is scheduled for next Tuesday.
This morning I attended the BOS meeting that included 5 resolutions to approve new MOUs. In last week's budget meeting, the board approved setting aside an additional $500K in reserves for the pension liabilities and $603K in reserves for "potential bargaining increases". I again addressed the board outlining my frustrations with the process, stating that the resolutions were merely formalities since the MOUs had already been negotiated and agreed to in closed session without any input or analysis from the public or the press. I reiterated my request for the board to adopt a COIN ordinance, which would add a greater degree of transparency to the labor negotiating process. I presented a COIN ordinance at the 28April15 BOS meeting. Unfortunately, no member of the BOS has expressed any inclination to pursue such an ordinance for Nevada County. The COIN ordinance adopted last summer by Orange County is attached. (Download Orange County COIN Ordinance) The entire subject of public pensions and what we do with unfunded liabilities might be a good blog thread to begin. The BOS needs to feel some pressure.
*****
‘Sandbox – 7jun15’ comment posted by: George Rebane | 08 June 2015 at 10:30 AM
Kudos to our George Boardman for his 8jun15 Union column. He again raises the fiscal cancer of unfunded pension liabilities that our county and city governments have (a problem long heralded and outlined in these pages); this is an issue that cannot be brought up too often these days. We recall that these cancerous pensions were installed by past supervisors and council members who knew absolutely nothing about how their handiwork would eventually metastasize. At the time those dummies just wanted peace and tranquility with their public employees so that the voters’ feathers would not be ruffled by inconvenient public employee strikes of slowdowns. In the final analysis it was, or course, we sheeple who elected the dummies and then paid no attention to what they were doing.
Mr Boardman’s recounting of his rejection by Nevada County Peeps brings a smile to my face. Here is a website that purports to be knowledgeable about Nevada County and local issues, and then has no idea of who prominent columnist George Boardman is because the man doesn’t maintain a Facebook page with a sufficiently informative profile. Boardman’s retort to his rejection revived Groucho Marx’s famous reply about his club memberships. My own takeaway is that it looks like Peeps may not be the all-knowing site on things local that it claims to be, and therefore Mr Boardman’s rejection will really make no never-mind to folks who pay attention to local happenings.
Anyway, the Boardman column is paywalled here –
http://www.theunion.com/opinion/16704168-113/george-boardman-pension-burden-threatens-to-crowd-out
rebanesruminations.com 
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