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Posted by: mturnipseed on 07/01/2009 02:25
Updated by: mturnipseed on 07/01/2009 02:25
Expires: 01/01/2014 12:00
Mark your Calendar
Comments to the Kern County Board of Supervisors
‘Mark Your Calendars”
By Michael Turnipseed, Executive Director
Kern County Taxpayers Association
June 30, 2009
Chairman McQuiston, Members of the Board, I am Michael Turnipseed, representing the Kern County Taxpayers Association.
Today, June 30, 2009, government agencies across California will be benchmarking the values of their individual pension funds. On this day, one year ago, the Dow Jones Industrial Average, our nation’s benchmark indicator of stock values, was 11,350. This morning, when the markets opened, the Dow was 8,530, a 25 percent decline.
On June 30, 2008, Kern County’s pension fund had $2.8 billion in liabilities, with only $2.1 billion in assets. Today’s value of those assets is approximately $1.57 billion, which represents a loss of value of 25 percent or over $500 million.
Comments to the Kern County Board of Supervisors
‘Mark Your Calendars”
By Michael Turnipseed, Executive Director
Kern County Taxpayers Association
June 30, 2009
Chairman McQuiston, Members of the Board, I am Michael Turnipseed, representing the Kern County Taxpayers Association.
Today, June 30, 2009, government agencies across California will be benchmarking the values of their individual pension funds. On this day, one year ago, the Dow Jones Industrial Average, our nation’s benchmark indicator of stock values, was 11,350. This morning, when the markets opened, the Dow was 8,530, a 25 percent decline.
On June 30, 2008, Kern County’s pension fund had $2.8 billion in liabilities, with only $2.1 billion in assets. Today’s value of those assets is approximately $1.57 billion, which represents a loss of value of 25 percent or over $500 million.
In 2005, the County budgeted $50 million to fund its pension obligations. Next year’s budget has $155 million addressed to funding pension obligations. That is a 210 percent increase in five years or an annualized growth rate of 42 percent. We all know this is unsustainable.
We also know other government agencies are planning on 40 to 50 percent increases in 2010-2011.
Cal PERS is planning to spread its losses over the next 30 years, which will only result in 30 percent increases in 2010-2011.
We think it is fair to assume, the county will be faced with recouping annual lost investment revenue of $40 million ($500M @ 8%) and annual recapture of lost assets which if spread over 30 years is $17 million. This $51 million is a cloud hanging over the 2010-2011 budget.
The taxpayers of Kern County urge the your Board to immediately reopen negotiations with all bargaining units and use every legal means to address this consumption of our county’s fiscal assets.
This situation only gets worse by the day, please address this issue with the urgency it requires.
Thank you, for your time and consideration of this critical issue.
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