Simi Valley ENDS a History of Balanced Budgets—Deficit Budget is Called “Sustainable”
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By Stephen Frank
Like other cities, my hometown of Simi Valley is facing the reality of the collapse of the pension system. Not only did they approve a general fund budget with a $500,000 deficit—to be financed by taking money from a redevelopment agency that died years ago—and the city refused to return the money to those from whom it was taken. Now they know their pension system is in trouble and weasel out of it by changing economic laws.
“The city has safety and miscellaneous employee pension funds that are about 73 and 76 percent funded, respectively, leaving gaps of about 27 and 24 percent.
“At one time there was a concept that you fund the retirement pension liability to about 80 percent. That concept is changing,” City Manager Eric Levitt said in an interview. “We are currently having a strategy to get to 100 percent within between 20 and 30 years and are paying about a 3 percent increase (into the pension accounts) per year to attain that goal.”
No, the concept is not changing of having enough money in the pension plan to pay its obligations. Instead bureaucrats change it to protect themselves and the fact the system is in trouble. Worse, since the founding of the City in 1969, the Council had been proud of having a balanced budget. Now it is only “sustainable”—which means it will not collapse until the city manager and the current city council are long gone. This is why folks have little respect or trust in government—they can not tell the truth about our financial condition.
Oh, they got into this mess by agreeing to union demands for pay and benefits—money that did not exist—so now they admit we have a deficit and the pension system is in trouble. But, the trouble started when the city agreed to “keep the peace” and pay off the unions.
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Stephen Frank
Stephen Frank: Is the the publisher and editor of the California Political News and Views. Mr. Frank speaks all over California and appears as a guest on several radio shows each week. He has also served as a guest host on radio talk shows and is a full time political consultant. http://capoliticalnews.com/
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