California’s pension system is more complicated than article let on

Jack Dolan’s article regarding California’s pension situation needs a little more information for Tribune readers (“The political deal that’s costing California billions,” Sept. 19).

SB 400 did not give civil servants a better retirement system. SB 400 made available additional retirement plans that could be negotiated for by civil servants with their respective employers. A change in retirement was not automatically given to any civil servant.

Yes, our pension fund is unfunded, just as our home is when we originally purchase it. We contractually agree to pay a set amount over a set period. Until we make that final payment, our home is “unfunded.” When a person is newly hired as a civil servant, his/her pension is unfunded. Over the course of their employment, through their contributions and the employer’s, their pension becomes “funded.”

To state that California government agencies have a huge unfunded pension liability ($241 billion) is assuming that every civil servant, regardless of their time on the job, will all be retiring on the same day and at the same time. A ridiculous assumption.

Many, if not most, of these “lucrative” retirement systems are no longer available. They were voluntarily negotiated away by various bargaining units to assist government agencies in lessening their annual budgets.

This story was originally published October 5, 2016 at 7:56 PM with the headline "California’s pension system is more complicated than article let on."