South Pasadena is a Fiscal Illusion

By |November 4th, 2018|Categories: Uncategorized|

By Michael T. Alexander, President of the California Taxpayers Union The City seems to disagree with everything being said in support of Measure N which would repeal the city's 7.5% Utility Users Tax that currently generates about $3.5 million each year.  This is curious, because the facts could not be simpler.  South Pasadena, like almost every city in California, owes far more to its current and future retirees than it can ever pay.  Even the City admits that it owes at least $29 million.  They get that phony number from the dreamers at CalPERS who fraudulently claim their investments are going to average 7.5% over the next 30 years.  If CalPERS were a private investment firm or insurance company promising those kinds of returns, they would be in jail.  And you know who would put them there? That’s right, the State of California.  The same State of California that allows one of its own agencies to do what it would never allow anyone else to do. In fact, we know that South Pasadena's pension debt, i.e., what they owe over and above what they have already paid into the system, could easily exceed $100 million.  That number is growing as we speak. CalPERS is sitting still.  They are making the cities come up with more and more money each year to “catch up.”  These “catch up” contributions are in the millions and will wipe out the taxes generated by the UUT and every other new tax they come up with. Cities all over California are complaining about and are rightly concerned that they are facing bankruptcy and/or radical reductions in municipal services.  It is the number one topic when leaders from different [...]

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