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Old Mendocino County Courthouse Around 1915

California County Pension Debt

 

Mendocino County's Pension Debt



The Pension Debt:

County Pension Related and Debt Payments



Mendocino County's Unfunded Pension Debt


Choices -

Growth & Amount of Debt

Pension Related Payments

County Payments

$700 Million to Pay Debt!

Profound Funding Failure

 

Total Debt Payments

Total Debt Payments by County of Mendocino 1993 - 2016 (projected)

Twenty years ago the County's payments for long-term debt were about $1.7 million a year. Today they are around $18 million. Official payment schedules indicate total debt payments next year will be $21 million.

Total debt payments have grown about 12% a year on average.

"All Other Debt" payments (real estate, major equipment, etc.) stayed steady between $1.7 to $3.3 million a year.

Pension Obligation Bond payments started in 1998 at about $3 million/year for the first round of Bonds sold in 1996. After the 2011 bonds payments have been $8 million. These will extend through 2117.

Unfunded Pension Amortization payments to the Pension Fund began in 2010. These payments are projected to continue through 2040. The payments started "low" at $3 million a year but are planned to increase each year until the final payments in 2040 are projected to be $27 million.

Major Point!

County payments of all other kinds of long term debt have basically remained the same over the past two decades.

Over that period County unfunded pension debt payments went from zero to $19 million.

They will continue to grow.

County Pension-Related Payments Per Dollar of Payroll

For Every Dollar Paid by Employees to the Pension Fund How Many Dollars Did the County Pay in All Pension Related Payments 1993 - 2016 (projected)

For every dollar of payroll how much does the County pay in pension-related payments?

Two decades ago the only pension-related payments were the County's share of the Normal Contribution which was about 10 percent of payroll. It's ranged between 7.5 percent to 12 percent.

But unfunded pension payments (Pension Bonds + Unfunded Pension Amortization) moved the County's pension related payments up to around 40 percent of payroll. It will be 45 percent next year.

The County is mostly a "service-delivery" organization - and for the most part those services are provided by its employees. The more pension-related payments it must make the less it has for salaries and other benefits.

Major Point!

Twenty years ago County's pension related payments equaled 10% of payroll. Next year it will be 45%.

The growth was entirely driven by increasing unfunded pension debt payments. That money can't go to today's employees and can't provide services to the People.

 
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