County, board respond to grand jury pension report

The county of Ventura and the board that runs the county pension fund have both issued replies that agree in large part with a grand jury report that labeled the county’s pension obligations “an uncontrollable cost.”

The county Board of Supervisors and the Ventura County Employees’ Retirement Agency generally agreed with the grand jury’s assessment of the problem, but they did not concur with some of the grand jury’s proposed solutions. The civil grand jury is a group of volunteers who investigate waste or corruption in local government. All of its reports must be answered in writing by the agencies being investigated, and the replies to the pension report were released on Thursday.

The county’s annual share of its retired employees’ pensions has more than tripled over the last 10 years, far outpacing the increase in total salaries. The county will pay about $140 million this year to its retirees, and that figure could double over the next five years.

However, both the supervisors and the Ventura County Employees’ Retirement Association said the grand jury made the problem appear worse than it really is by starting its comparison in the late 1990s. Pension contributions by local government were unusually low in that period because the stock market was generating huge returns that were applied to retirees’ pensions.

The county rejected the grand jury’s recommendation that it form a committee to study the idea of shifting from a “defined benefit” pension to a “definied contribution” plan, much like 401(k) accounts that many private-sector workers have. That change is not necessary and would make it harder for the county to compete for employees, the county’s response said.

The grand jury also recommended that any proposed increases in employee benefits should go before the county voters. The supervisors said this might be beneficial someday, but it is not necessary now, because the board has denied requests for more generous benefits.

The county agreed with the grand jury’s recommendation that when the pension fund earns more than it needs in a given year, it bank the “excess earnings” for future years. But VCERA, which controls the excess earnings, said it will continue to decide how to spend them on a case-by-case basis. Most excess earnings have been banked, but in some cases they have been used to increase benefits.

http://www.venturacountystar.com/news/2009/aug/06/county-board-agree-with-grand-jury-pension/