The Morning Report
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Advice to the mayoral candidates:
The city of San Diego’s biggest financial problem remains its underfunded pension plan.
How to fund the required annual contributions, and close the deficit gap, without shutting down the city will be a big part of the new mayor’s responsibility.
If this were not so serious, it might be excused that our candidates for mayor have but a nodding knowledge and apparently less real interest in really understanding the subject.
But there is a way that a new mayor could quickly close this knowledge gap on how the plan, the board and the staff of San Diego City Employees’ Retirement System work. If the new mayor does not learn quickly, they will be at greater risk of repeating the errors of the past.
When Mayor Jerry Sanders took office, he knew he had a big problem, as did most of the public, caused by the past over-promising and underfunding of the pension plan. But what to do about it seemed to escape him, not for lack of trying.
To avoid this mistake being repeated, I have a simple suggestion: The new mayor, under city code, will have one mayoral appointment to the SDCERS pension board. I suggest he appoint him or herself.
Granted, service on a board is far less exciting then cutting ribbons, kissing babies or attending luncheons in your honor but there is no substitute for hands-on involvement with the pension board to learn how it operates and to improve that operation.
The new mayor will learn how good the pension staff is or isn’t. The quality of their consultants and attorneys. Their method of evaluating and investing the portfolio.
I believe a year, maybe two, on the pension board would provide our new mayor with far more knowledge than reports and consultants could ever provide. Knowledge that would help him or her develop a strategy to fully fund the city’s obligations to the plan.
Peter Q. Davis is a former candidate for mayor for the city of San Diego and a former member of the San Diego City Employees’ Retirement System board.