Pacific Grove will go down in history as one of the few cities to pull out of the California Public Employees’ Retirement System.
Former P.G. City Councilman Dan Davis, a mathematician whose term ended earlier this month, has been arguing for the city to quit CalPERS for years. New reports show the state retirement system has lost 31 percent of its value– more than $81 billion– since its peak in October 2007.
“You don’t really need to understand the details to know that we’re in trouble,” Davis says. “If [CalPERS] doesn’t recover those losses, we need to make up the difference. Cities don’t have the money to do that.”
It may seem logical for P.G. to jump from a sinking CalPERS ship– but the timing is terrible. If the city had terminated the retirement plan in June 2007, Davis says, CalPERS would have refunded P.G. about $10 million. In June 2008, the refund would have been about $1 million.
“Now,” he says, “the city of P.G. owes CalPERS about $20 million.”
Yah, I know. Attract and keep quality workers with CalPERS as a benefit. But by winning workers from another town you’ll fill the ranks with workers that are prone to jump ship. If they left one job to come here, what keeps them from moving on. I have worked at jobs that were not as good as offers from Oakland. But who wants to work in Oakland?