Water, pension and retiree health care costs remain the top three issues for California, state Treasurer John Chiang told a group a business and property owners in San Luis Obispo on Thursday.
Climate change and the severe drought are also ongoing challenges that must be addressed, he said to about 50 people gathered for a San Luis Obispo Property and Business Owners’ Association lunch meeting.
Chiang served from 2007 to 2014 as state controller and was elected in November as California’s treasurer, where he sells California’s bonds, invests the state’s money and manages its cash.
As controller, he pushed for transparency in government by posting more data online about city and county revenues, liabilities and assets, as well as salaries of public officials. Last year, he added public pension systems to the database.
“It’s a learning system for you to understand what is happening with the finances of your local government,” he said. The pension data showed that despite receiving more money, pension systems’ unfunded liabilities soared from $6.33 billion to $198.16 billion over an 11-year span, according to a Sacramento Bee report.
A plan by the California Public Employees’ Retirement System, which provides the city of San Luis Obispo’s retirement benefits, aims to pay down unfunded pension liabilities over the next 30 years.
San Luis Obispo’s unfunded pension liability is $115.6 million, according to a city report prepared in December. In February, the City Council established a framework for prepaying certain long-term liabilities and agreed to give priority consideration to accelerated payments to the unfunded pension liability.
The city’s 2015-17 financial plan, which will be discussed Tuesday at the council meeting, allocates $12 million to pay down a portion of the unfunded pension liability.
A preliminary financial plan will be presented to the council in May, followed by three budget workshops in June before the final budget adoption.
“One way or another, the citizens here will see some reduction in our pension liabilities,” said Steve Barasch, a board member of the property and business owners’ association and the public member of San Luis Obispo’s Investment Oversight Committee.
On Thursday, Chiang took luncheon attendees through his time in office during the Great Recession, where he became “the most unpopular person in Sacramento” as a result of efforts to keep the state from running out of money by issuing IOUs to vendors.
“We have made tremendous progress in Sacramento, but we have to do a lot more work,” Chiang said.