Take 2...

 I was invited to a television interview, I was more than a little nervous with my very first TV appearance.  But this is what I was trying to put across to the viewing audience.

The county’s pension system is not a popular subject; but it is on everyone’s mind. I have made it the forefront of my campaign because myself and so many other residents are concerned for the economic health of our County.  How did county government get in this position, two words come to mind “irrational exuberance” that started in early 2000 with the real estate boom.

As the tax revenues skyrocketed from $140,015,672 in 2000 to $362,277,471 in 2011  (even after the downturn) representing a 158% increase. The county in early 2000 went into a hiring spree adding 1,400 employees making San Mateo County the 4^th largest employer in the county. The salaries and benefits increased from $282,827,065 to $747,544,055 a 164% increase and the cost per employee form $76,275 to $137,467 an 80% increase.  The county’s pension unfunded liability increased exponentially with investments losing value due to the falling market and the bursting of the real estate bubble.

So what was done so as not to declare bankruptcy? 

• The losses were spread over a 5 year period
• The employer (San Mateo county) contributions were raised from 23% in 2008 to 34% in 2009 and beyond and we expect an increase to 41%; however, it is strange that employee contributions went down .03% by 2010.

And while future obligations are calculated at 7.75%, the past five year returns stand at 1.14%, now that is “irrational exuberance”.

This is a serious situation and we cannot bury our heads in the sand, we need to face reality on this unpopular subject, otherwise our children and grandchildren will be saddled with debt.  We need to reevaluate and “fix” the defined benefit system now and make county pension sustainable.