18 Mar The Ticking Pension Bomb
What’s the problem?
The entire state of California is known for its underfunded public employee retirement fund. State officials assume that pension returns will earn approximately 7%, which in 2020 put unfunded pension liabilities at $352.5 billion statewide, or $27,187 per household. However, Stanford economist Joe Nation analyzed the same numbers and assumed a much lower return rate of 3.25%, putting unfunded liabilities at a near $1.1 trillion, or $81,634 for every family in this state. Over half of the citizens in California do not have any money saved for their own retirement and of those that do, the average yearly retirement income is only $28,258.
In San Bernardino County, the average pension benefit is $95,800 per year. When compared to an average public pension of $69,759 in neighboring LA county, $88,604 in Riverside County, and only $37,000 across the state of California, it’s immediately clear that San Bernardino retirees are better compensated than their counterparts.
So, what is the liability for San Bernardino County? Joe Nation examined SBCERA and concluded that the real pension liability for San Bernardino County is at least $12 billion. However, in their most recent annual report the county reported their pension fund as being underfunded by a mere $2.7 billion. Understating this liability is incredibly risky, unfair to the citizens, and must be dealt with.
What can be done?
It all starts with YOU and electing officials who will serve you. Currently, there are three candidates who have signed the Good Governance Pledge, promising to work only for the citizens and not for the special interests that run the county. In District 2, we have two candidates that we support: Eric Coker and Nadia Maria Renner. In District 4, we support Larry Wu.