So here in financially challenged California, John Dickerson (www.yourpublicmoney.com) applied these adjustments to the pension fund numbers as reported by the six counties in the Bay Area and the North Coast with independent pension funds. I’ll use one of them, Contra Costa County, as an example (PDF) because it will crop up again in our boondoggle story.
The pension fund reported total unfunded liabilities of $1.215 billion. After Moody’s adjustments have been applied, they explode to $3.519 billion. It gets worse. To paper over pension deficits, governments issue Pension Obligation Bonds (POB), which are often not reported as liabilities by pension funds. Pension funds grab the cash, governments hold the debt. When Contra Costa County’s $516 million in POBs are included, total unfunded pension liabilities rise to $4.037 billion—over 3.3 times the reported amount.
Tuesday, March 12, 2013
Broke Public Pension Funds And Exotic Boondoggles
Somehow I missed this over at Testosterone Pit: