6/12/2013: From Hannah Hoffmann in the SJ:
Public sector retirements this year are up 54 percent over last year, according to statistics kept by the Public Employees Retirement System. Workers say the proposed cuts in the legislature are driving their early exits.
PERS spokesman David Crosley said 2,305 public sector employees retired last year between January and June. This year, 3,539 people have retired between January and June.
Fortunately Salem has announced they will not raise the cost of dulling the pain.
6/8/2013: From Harry Esteve and Christian Gaston in the Oregonian:
Revenue: Lawmakers would approve $275 million in additional spending by reducing medical care tax breaks given to the elderly; increasing cigarette or beer taxes; lowering personal income tax deductions; and raising corporate tax rates.
PERS: In addition to the $460 million savings approved last month in Senate Bill 822, the state would save $440 million by further reducing cost-of-living increases for retirees and by changing the payout formula for workers who are no longer in the PERS system.
6/4/2013: Panic update:
Kitzhaber holds more secret meetings with legislators.
Persinfo blog advises those who can, to consider retiring by 7/1/2013, to avoid getting hit by death table revisions.
Rumor is that at least 3 B-school profs and several other quant types retired Friday 6/1/2013.
Read the thoroughly frightening Friday post from the PERSINFO blog:
The Oregon Republicans in the Legislature used a lazy Thursday afternoon, very late in the month of May to announce their newest “compromise” proposal on PERS Reform. I’m not going to bore you with too many details; you can read the proposal for yourself here http://oregonpers.info/Library/Download.aspx?docid=1542
. What’s notable about the proposal is that it contains every element of the former SB 754, with just a few of them scaled back in their extent. From here on out, I will refer to the new proposal as “SB 754 sorta lite”. The hands behind this bill are principally the Oregon School Boards Association (OSBA) and its umbrella group “Fix PERS Now” (see yesterday’s post).
The bill is audacious in its scope, revisiting the retiree COLA even more punitively than before, it goes after inactives by proposing a cut to the Money Match annuity rate from the current 8% to 4% (the PERS Board will take up the assumed rate at today’s Board meeting and will undoubtedly cut it to 7.5% in July, to be effective for all retirements after December 1, 2013), “fixes” the Judges pension (how isn’t clear), ends pension spiking without completely eliminating sick leave (I guess you can have 40 hours) and vacation time, it redirects 1% of the IAP to the PERS fund your own retirement, offers flexibility to employers to renegotiate the 6% pickup, removes Legislators and other statewide elected officials from PERS, and creatively goes after OPSRP members (Tier 3) by reducing the accrual rates by 25 basis points going forward. It also raises the retirement age for OPSRP by 2 years.
5/31/2013: They’ve put 22% of
their our portfolio into private equity. Earnings?
- PERS private equity picks: 5.59% annual over past 5 years.
- PERS stock picks: 2.52% over 5 years.
- The Russell 3000 benchmark?: 5.63% over 5 years.
The comparison is even worse if you look at last year, disastrous if you look at this year so far. So why are they paying big salaries to state employees to schmooze with the private equity salesman and pick stocks? They had a few lucky years way back, and now they think they are Warren Buffett. Nope, just buy the benchmark basket. More PERS info here.
What about Jamie Moffitt’s claims that UO couldn’t give raises because of the scary upcoming PERS cost increases? P64 of the pdf here
Costs this biennium will increase by only 0.7% of salary, not 5.1%. So, she can now boost the UO raise proposal from 10% to 14.5%!