Monday, August 17, 2015

Oregon must detoxify PERS

Register Guard
August 16th, 2015

The financial hydraulics of Oregon’s Public Employee Retirement System are simple: If more money goes out, more must come in — and if less money comes from one source, more must come from another. Similar principles govern the politics of the pension system: If nothing is done to control the cost of PERS, public frustration will be directed at other targets.
State and local governments will see both types of cause-and-effect sequence soon. The courts and the pension system’s actuaries have delivered a double whammy that will increase the cost of PERS by $1.7 billion per biennium starting in 2017. To soften the blow, the initial cost will be reduced, resulting in even larger increases later on. As pension costs soak up revenues, public resentment will rise: Voters won’t be easily persuaded to pay more for public services if they have reason to believe that PERS is first in line for every tax dollar.

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