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Daniel Weintraub

California Insider

A Weblog by
Sacramento Bee Columnist Daniel Weintraub

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« July 12, 2005 | | July 14, 2005 »
July 13, 2005

Tom Campbell on budget, pensions

In an editorial board meeting with the Bee on Tuesday, Finance Director Tom Campbell said negotiations with the Legislature over an alternative to the governor’s Live Within Our Means proposal were alive and well. Of course, Campbell himself wrote an alternative, the governor’s original proposal in January, which allowed for across the board cuts in all state programs whenever revenues fell short of expenditures. It sounded as if the director hadn’t quite given up on that proposal, now known as Assembly Constitutional Amendment 4.

In other news, Campbell also said he believes a compromise on pension reform is near. But most of what he mentioned as possible pieces of a package sounded like window dressing:

--Putting into law the 15-year “smoothing” policy recently adopted by CalPERS to reduce volatility in the state’s contributions to the pension fund;

--Making the employer contribution mandatory, even in good years;

--Changing the amortization schedule for paying off an unfunded liabiltity;

--Encouraging CalPERS to hedge its bets in the stock market by buying options that would reduce the fund’s exposure to downturns (and reduce its earnings in good times).

--Reforms aimed at limiting disability retirements by high-level officials (chief’s disease) and pension spiking.

What about rolling back benefits to 1999 levels for new hires? That would be nice, Campbell said, but difficult because it would create a two-track set of benefits for employees in the same workplace. “It’s not unachievable,” he said, “but difficult.” Strange, the governor’s original proposal in January would have created an even bigger difference between benefits for current and future employees, and that didn’t seem to bother Campbell at the time.

Sounds to me like the governor’s office is looking for any kind of package that it can call “reform” with a straight face and is prepared to settle for accounting, actuarial and rules changes short of addressing the long-term problem with bigger benefits granted during the stock boom, especially in local government, that will be difficult to sustain.

Posted by dweintraub at 1:26 PM



Eminent domain: California

Sen. Tom McClintock plans to introduce his proposed California constitutional amendment tomorrow permitting the use of eminent domain only in cases where the public controls the property after it is purchased or public access to the property is assured. As I understand it, this would pretty much end redevelopment as we know it in California since it wouldn't allow government to forcibly buy property from one private owner and then give or sell it to another, even if the property is blighted.

Posted by dweintraub at 1:00 PM



 
 

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