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Blue Model Blues
Pension Costs Batter Southern California
The fiscal situation is darkening for local governments in Southern California even as the economy booms. Voice of San Diego reports:

The economy is doing well and tax revenues are rising – so why are three of San Diego’s largest government agencies facing massive hits to their bottom lines?

The city of San Diego estimates it must slash $47 million to $67 million in spending, San Diego County may have to cope with $100 million in new costs and San Diego Unified is staring down at least $124 million in cuts – an especially dire challenge because the reserve fund has nothing to spare.

It won’t surprise regular Via Meadia readers that spiraling pension costs are the main problem. San Diego County is facing a half a billion per year in costs for pensions and pension bonds, and the city of San Diego is looking at huge pension cost increase as CalPERS cuts its projected rate of return after falling short year after year.
If relatively well-managed local government entities in a prosperous region in a wealthy state during an economic expansion face problems like these… well, let’s hope President Trump pulls some economic rabbits out of the hat or we’ll all (blue cities and blue states more than most) be in a world of trouble.
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  • Libertarianski

    u folks invited the illegals in, they cost $ and sent $ home thereby NOT contributing to your tax base.

  • Fat_Man

    So it begins.

  • Pete

    The ‘blue’ cities are getting just what they deserve.

    No federal bailout for them!

  • ——————————

    TIMBER!!!….

  • CaliforniaStark

    “If relatively well-managed local government entities in a prosperous region in a wealthy state during an economic expansion face problems like these.”

    You have got to be kidding. San Diego was once referred to as “Enron by the Sea”; and rather than address its serious fiscal and pension issues, it simply enacted band-aid solutions and attempted to ride out its fiscal mess in an improved economy. Now it is in trouble again, and it will get worse. Sadly, the mess was caused by Republicans in San Diego devolving into a party of “crony capitalism” and feeding at the public trough. Presently the supposedly Republican mayor of San Diego is attempting to outdo Governor Brown as a climate crusader.

    • Kneave Riggall

      The word at issue here is “relatively”. San Diego is MUCH better managed than San Francisco, but still . . .

      And let’s NOT talk about CalPERS.

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