Calpers does back-of-the-envelope calculations on pension proposal

When you're slapping together complicated legislation at the last minute, don't expect much in the way of smart analysis. Calpers officials determined that the pension overhaul being proposed by Gov. Brown and state Democratic lawmakers would save California and local governments between $40 billion and $60 billion over 30 years. But that's only an initial estimate - and it's loaded with caveats. From the Sacramento Bee:

CalPERS continues to refine it's numbers, [actuary Alan Milligan said], aiming for a more more accurate accounting in time for Friday's Assembly and Senate floor votes on the bill. Fund staff concluded the biggest employer savings wouldn't be realized for many years if the bill is enacted, since most of the pension downgrades apply to new state and local government hires, including provisions that reduce benefits and cap wages that can be considered for retirement purposes.

If most of the savings aren't realized for 20 or 30 years down the road, when yet-to-be-hired workers approach retirement, how does this plan address the current shortfall faced by state and local governments? It doesn't, at least not an any significant extent.

More by Mark Lacter:
American-US Air settlement with DOJ includes small tweak at LAX
Socal housing market going nowhere fast
Amazon keeps pushing for faster L.A. delivery
Another rugged quarter for Tribune Co. papers
How does Stanford compete with the big boys?
Those awful infographics that promise to explain and only distort
Best to low-ball today's employment report
Further fallout from airport shootings
Crazy opening for Twitter*
Should Twitter be valued at $18 billion?
Recent California stories:
Volcanic cinder in Owens Valley
Holiday shopping: On your marks, get set... spend!
14 California bookstores in nine days
Uproar over health care sites could be settling down
BART strike to end Tuesday in the Bay Area

New at LA Observed
On the Media Page
Go to Media

On the Politics Page
Go to Politics
Arts and culture

Sign up for daily email from LA Observed

Enter your email address:

Delivered by FeedBurner

Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
LA Observed on Twitter and Facebook