There is an old saying: “If you think education is expensive, try ignorance.”
By Mike Henn
September 15, 2014 | 2:28 p.m.
The Register article below is great news for Newport’s taxpayers. For months Team Newport campaigned on the theme of paying down our long term debt early – both the unfunded pension liability and Taj Mahal debt. Of course, Team Newport was belittled by the status quo including Mike Henn stating in a September 15 Daily Pilot column that they were ignorant. (above)
Lo and behold the public spoke and they got Team Newport’s message. A good drubbing always improves a politician’s hearing.
Newport’s taxpayers are the big winners as the city’s finance committee has recommended an accelerated debt pay-down schedule of 19 v. 30 years, saving taxpayers millions. It’s good that they heard Team Newport’s message. Our friends in Irvine figured it out earlier this year.
I expect the out-going council will approve the recommendation at their last official meeting of November 25. That’s ok, it’s the taxpayers that get the credit.
Newport Beach seeks to fund employee pensions quicker
BY MEGAN NICOLAI
Newport Beach city leaders are looking at shortening the payment plan to fund their employees’ pensions by 11 years.
The City Council’s Finance Committee met this week to look at ways to pay off obligations to their California Public Employees Retirement System plans sooner as a cost-saving measure. The city’s unfunded liability, the difference between how much the city will owe in retirement benefits and the money it has set aside, is projected to be $273 million at the end of the 2014-15 fiscal year, according to a city report.
Finance Director Dan Matusiewicz said the city’s unfunded liability will be bumped up after a CalPERS Board of Administration decision last year that required agencies to put in more money sooner to make up for the recession.
To ramp up payments to the city’s $273 million unfunded liability, Councilmembers Mike Henn, Keith Curry and Tony Petros perused proposals for a 19-year, 15-year and 10-year payment plan instead of the current 30-year plan.
All three members agreed on suggesting the 19-year plan to council, which would cost the city $23 million more in the next five years but ultimately yield about $129 million in payment savings.
Newport Beach isn’t the only city to look at an altered payment schedule or early payments. Irvine decided last year to accellerate unfunded liability payments to pay off that total a decade early. Tustin voted to make a lump sum payment to CalPERS this month for $4.3 million to pay off a side fund.
The 19-year proposal could go before the Newport Beach City Council as early as Nov. 25.
Contact the writer: email@example.com; on Twitter @MeganNicolai