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Posts Tagged ‘California Foundation for Fiscal Responsibility’

California Pension Payouts Increase 73% in 2 Years

Posted by Larry Doyle on June 21st, 2012 8:54 AM |

How does one define a “racket?”

Well, in a takeoff of a similar question regarding pornography, I am not sure exactly how I might define a “racket” but I believe I would know one when I see it.

So, where should we look to see a racket at work? California and specifically the public pension system in the Golden State. A few weeks back I highlighted what I believe will be “civil wars” over public pension reforms in our country.

A primary battleground on this front will be the hard left-leaning people’s republic on our left coast. Is there any real surprise that California finds itself in such a fiscal mess? Not really.

How bad is the situation in California? (more…)

“Fix Pensions and We Won’t Have to Fire Teachers”

Posted by Larry Doyle on May 9th, 2011 9:36 AM |

You do not need to read Sense on Cents to know that many of the states in our union are drowning amidst a sea of future pension obligations. While state treasurers and legislators are all too often inclined to play financial games and utilize smoke and mirrors to disguise the burden of these pension obligations, the absolute figures are so astronomical and will require a meaningful restructuring. Might that happen? Would public employees actually swallow a very real revaluation of their pension benefits?

Marcia Fritz, the head of the California Foundation for Fiscal Responsibility, is calling for her state to do just that. Ms. Fritz recently released a statement entitled, Fix Pensions and We Won’t Have to Fire Teachers,

California taxpayers would save billions of dollars that would flow to public schools, community colleges and universities if state and local public employees retired with benefits comparable to those provided to employees of Silicon Valley’s top companies. Teachers’ jobs would be saved and school programs spared. (more…)

California’s $100,000 Club

Posted by Larry Doyle on May 2nd, 2009 9:10 AM |

Hat tip to MC for sharing with us an initiative of the California Foundation for Fiscal Responsibility. The CFFR was founded two years ago to develop transparency in the California pension system. Make no mistake, current and future pension obligations at the state and local level will impact almost every aspect of our lives. The current deficits in these pensions funds and the increasing obligations as our population ages will serve as a chokehold on future generations. This same dynamic is playing out at the federal level as well. However, let’s focus on California.

I am all for longstanding civil servants receiving pension benefits. However, the largesse that has been contracted in certain circumstances is anything but fiscally responsible. I commend the CFFR for working to provide transparency on this topic. Let’s dig deeper. As the Sacramento Bee highlights, Pension Watchdog Puts Database of 5,000 Calpers (California Public Employees Retirement System) Online.

Information is critically important for fiscal discipline. Transparency in the pursuit, collection, and dissemination of that information is a cornerstone of good government. Regrettably, too often our public servants conflict themselves in currying personal favors while obligated to perform their public service. To that end, I commend CFFR for shedding light on this critically important topic:

“We feel it’s time for transparency on this issue,” said CFFR vice-president Marcia Fritz. “In the current economic climate, it’s important that taxpayers know what kind of pensions our public employees are receiving and what the budget implications will be.”

CFFR was founded in 2007 by Keith Richman, a former LA County Republican assemblyman. 

Richman says the foundation’s sole purpose is to highlight  the skyrocketing costs of public employee retirements.

I am not looking to promote personal witch hunts. I am looking to promote fiscal responsibility.  I would hope that every state and local municipality develops an initiative like the CFFR. To that end, please question your local representatives as to how many individuals are collecting six figure pensions. Share with them the fact that in California over 4,800 individuals have six figure pensions. In fact, Bruce Malkenhorst, a municipal government retiree from Vernon, CA is “collecting” a cool half million bucks a year in retirement. An article from Forbes Magazine back in 2007 sheds further light on the municipality of Vernon, California:

Welcome to Paradise
by Evan Hessel 02.26.07

The city fathers of Vernon, Calif. run their tiny town like a family business, with unchecked power, pay and perks.

Four miles south of downtown Los Angeles sits the city of Vernon, a five-square-mile industrial enclave of meatpacking plants, warehouses and paint-mixing factories. There’s not much to see, but smells are plentiful, courtesy of a rendering factory that boils the dead pets of southern California into grease and high-protein animal feed.

Only 92 people live in Vernon. There are no parks, schools, libraries, health clinics or grocery stores. The only four restaurants close by 4 p.m. By sundown the 44,000 workers who commute here have all fled the stench.

Vernon’s leaders like it that way. California’s tiniest city, if you want to call it a city, is one of the nation’s most lasting and efficient political machines, run almost entirely for the benefit of a handful of rarely opposed, extremely well-paid politicians. Vernon should have been subsumed long ago into the surrounding city of L.A, but its independence is a strange and stark example of how a democracy can become a dynasty.

Vernon is run by two families: the Malburgs and the Malkenhorsts, neither of which agreed to be interviewed. The bespectacled Leonis C. Malburg, 77, whose grandfather founded Vernon in 1905, has been mayor for 33 years. Bruce Malkenhorst, 71, was for 32 years the city administrator as well as clerk, finance director, treasurer, redevelopment agency secretary and chief executive of the utility Vernon Light & Power. The city was reportedly paying him $600,000 a year, more than twice what L.A.’s mayor earns, until he resigned all posts unexpectedly and without public announcement in 2005. By most accounts Malkenhorst still pulls the strings. His appointed successor is his 42-year-old son, Bruce Jr.

Theirs is a benign dictatorship. Who would run against them? Outsiders hoping to move into town are denied housing permits and Vernon’s 32 houses and apartments are owned by the city and leased to its employees for as little as $150 per month. In 1980 Malkenhorst Sr. evicted a former cop from his Vernonowned house after he ran against Malkenhorst’s favored candidates. Last year the state Superior Court forced Malkenhorst Jr. to move ahead with an election he had derailed on the grounds that the three challengers had moved in illegally. Once the votes were counted, the incumbents won anyway—in a landslide.

While many state unions do not appreciate the release of information by the CFFR, I believe every state should publicly release it. Watchdog groups should not be forced to request it. To that end, I encourage everybody who reads this post to share the link to CFFR with your local reps and specifically highlight California’s $100,000 Club.


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