Lou Correa. Principal coauthor of public pension disaster
How many of us remember SB 400 introduced in the California Legislature by Senator Ortiz?
That 1999 Bill, providing 3%@50 pension benefits for public safety unions, was Chaptered by the CA Secretary of State on Sept 29, 1999 and signed into law by former governor Davis.
While those of us living in Orange County may not be familiar with the name Deborah V. Ortiz of Sacramento, we certainly know the name Senator Lou Correa.
At the Rush Limbaugh Fan Club meeting this morning, invited guest speaker Stephen Frank provided an update on our current [unreported] state deficit. During his presentation Steve reminded us of the role played by than Assemblyman Lou Correa in creating the pension increase that is driving us into bankruptcy.
As I research the history of the bloated pension system that is bankrupting our state I found several articles including one by the Register dated 12-17-09 where they called SB 400 “one of the worst financial decisions in the state’s history.”
For Assemblyman Correa to be the principal co author from the Assembly side of the aisle, with his BA in economics from Cal State Fullerton, along with an MBA and Juris Doctor from UCLA, makes me very angry. Did he expect the dot com tidal wave to continue forever?
How deep is the hole? The April 6th NY Times “Finds Half-Trillion-Dollar Gap”
“Applying fair-value accounting, the pension shortfall is around $425 billion, plus a market loss of $110 billion. That total is far from the $55 billion officially reported in 2008.”
An independent analysis of California’s three big pension funds has found a hidden shortfall of more than half a trillion dollars, several times the amount reported by the funds and more than six times the value of the state’s outstanding bonds.
California Gov. Arnold Schwarzenegger says that unless legislators act on pension reform, programs will have to be cut.
The analysis was commissioned by Gov. Arnold Schwarzenegger, who has been pressing the State Legislature to focus on the rising cost of public pensions. Graduate students at Stanford applied fair-value accounting principles to California’s pension funds, using a method recently devised by two economists working in Illinois, Joshua D. Rauh of Northwestern University and Robert Novy-Marx of the University of Chicago.”
Full NY Times story link below.
http://www.nytimes.com/2010/04/07/business/07pension.html?_r=1&src=me
If I am not mistaken Lou Correa also broke the 2008 Taxpayer Protection Pledge
Should voters reward Lou on Nov 2nd? I don’t think so.
Larry,
The problem with going to a meeting of the “Rush Limbaugh Club” is that you will only hear one side of the story.
I searched for the bill you referenced and found out that quite a few Republicans voted for that bill. You can see for yourself at http://info.sen.ca.gov/pub/99-00/bill/sen/sb_0351-0400/sb_400_vote_19990910_0111AM_asm_floor.html.
These Republicans included:
Roy Ashburn
Pat Bates
Bill Campbell
Bill Leonard
Rod Pacheco
Abel Maldonado
Robert Pacheco
Now those are just the Assemblymen who voted for the pension spike. Here are the State Senators who did so as well (and for the record NO Republicans voted no!):
Ray Haynes
Jim Brulte
Dick Mountjoy
Peace
Poochigian
I probably missed a few that I did not recognize. See the full list at http://info.sen.ca.gov/pub/99-00/bill/sen/sb_0351-0400/sb_400_vote_19990910_1113AM_sen_floor.html.
It is easy to rip Senator Correa. But it is also intellectually dishonest. That bill would not have passed without major support from your fellow Republicans, including many “conservative” friends of Stephen Frank.
As for the tax increase you mentioned, it too passed with GOP votes. Two of these Republicans are in fact on the November ballot – Abel Maldonado and Mike Villines. Why blame just Correa? If anything, the six Republicans who voted to increase our taxes are even more culpable! Had they held their ground the tax increase would have been defeated.
Correa is a good man and one of the only Latinos in the State Legislature, from the OC. I intend to support him. By all means, please do oppose him if you like, but lets be fair about the record. As I indicated herein, Correa is hardly the only legislator who voted to spike public employee pensions. Both the pension increase and the tax increase were ultimately the fault of Republicans, including many so-called conservatives.
Art. I will revisit the list. Before writing this post I went to the state leg info site. I do engage in Trust, But verify. It was not a case of hearing one side of a story at a RUSH Limbaugh club meeting.
Page 1 of 64 on S.B No. 400 Chaptered status only lists the people who introduced the bill which is where you can find Lou listed. There are only five names shown none of which are in your list. Burton, Correa, Ortiz, Pescetti and Steinberg.
To double check his role I also went to the single page Bill Status where it also lists Lou as a key player. In addition it shows a 9-1-1999 Assembly Appropriations Committee vote of 15 AYES and 6 NO votes.
If you notice I did not mention Lou’s involvement in the County following the state Bill that I also saw in one of the print media articles that I read before completing the post.
This post is not about the tax increase. I opposed Villines and Maldonado as a result of their breaking the tax pledge as confirmed in my prior Larry’s Picks.
And for Juice readers let me also say that we have each been with Lou at private social events. This post should not be construed as an attack against a Latino elected official. You surely know that I am not prejudiced. I have gone after Anglo Republican elected officials right here in Mission Viejo.
To repeat the background for my title. Lou was the principal co-author which means that he was a champion for the excessive benefit that is burying our state today.
Larry,
Understood, but you should also acknowledge the fact that all major legislation in our state is authored by Democrats – because they rule the roost. So it is no surprise that no Republicans authored the bill. The real key here is who voted for it, and as I illustrated just about all the Republicans in Sacramento voted for the bill. There is the rub. Both parties erred. Why do you think I quit the GOP? I would rather be a Libertarian than belong to the red and blue parties…
Art,
It’s always the Republicans’ fault, isn’t it? We tried to hold turncoats like Maldonado and Villines accountable, but the uninformed public isn’t interested in learning the truth. I hope anyone who voted for pensions or tax increases, on either side of the aisle, gets the boot he or she deserves.
So what have you done to hold Correa accountable for the pension debacle which will cost the state far more than the ridiculous tax hike we got last year? Don’t worry, I won’t be holding my breath for any real accountability from you there.
Newbie,
I see you forgot to mention all the alleged “conservatives” who backed the pension spike. How convenient.
Correa knows how I feel about this and the truth is that he has been working on legislation to reform public employee pensions. But don’t let the truth get in the way of your GOP shilling…
Newbie.
What you are not aware of is that when I was president of the SRA Art participated in the election of our 1999 board. At that time he served as chairman of the Orange County Chapter, Republican National Hispanic Assembly.
Having previously served as chairman Art’s decision to leave the party was not an easy one for him to make. Like myself he will hold your feet to the fire regardless of your party label.
Larry’s correct that Correa broke his tax pledge two years ago. He’s a despicable liar.
Let’s pull for Lucille Kring to kick his fat ass.
Masters,
And as I pointed out, six Republicans voted for that tax increase – which forced Correa’s hand. Two of those Republicans are on your November ballot – Abel Maldonado and Mike Villines. Why aren’t you attacking those Reeps?
As for Kring, she has no legislative experience and I think she is running because she signed a bad lease at the Anaheim Gardenwalk and her Wine Bar is losing money. Kring is looking for a taxpayer bailout by trying to get elected to the Senate, where she will make six figures. Is that the right reason to run for office?
Art. I plan to call Lucille and interview her for the Juice blog. One of the traditional questions I ask candidates is for them to tell us why they are running among many other questions.
While it is true that Garden Walk is a loser, I don’t think that her wine bar ROI would be a reason to run for an office in Sacramento. I do recall Lucille being a licensed realtor (or broker) in Orange County.
In fact one of us should also interview Lou and post his answers.
Larry,
LOL! You know what has happened to the realty business over the past few years. If what you say is true all the more reason for Lucille to seek a public bailout via a high-paying State Senate job.
Please do interview her. I will ask Senator Correa if he is interested in being interviewed but he is quite busy serving his constituents. I would have to take him away from that.
Art,
Thanks again for confirming that Correa had no intention of honoring his no tax pledge but that he only signed it for political gain. The turncoat Republicans had nothing to do with his vote to increase taxes. He made that decision all on his own.
Newbie,
Again, that is pure GOP spin. Correa had every intention of honoring that pledge. However when six Republicans, including two who are on the November ballot as candidates for statewide office, voted to increase our taxes it put Correa on the spot. Had they held their ground the budget and tax increase would have failed. But they didn’t.
Correa did the best he could under the circumstances, negotiating to bring back a ton of money to our county.
Correa is one of the most conservative Dems in Sacramento. He does not reflexively support higher taxes. It is unfortunate that the lame Republicans cannot say the same.
I hope you will be voting Libertarian in November instead of supporting Abel Maldonado and Mike Villines, the tax-raising Reeps on the ballot in November.
Masters. Lou was not the only elected official to break their ‘no tax” pledge.
However, I would respectfully ask readers to stay on the main theme of this post which is the public employee pension obligations that will bury us.
Art. Let me add a few points to the post.
1. Steve’s presentation was not about Lou Correa. After the meeting I had to research the date of the bill and the bill number. He had no idea that I was going to post his presentation. You are surely welcome to ask a Central Committee member who was there sitting next to me that supported Harry over Shawn. You know who I am referring to.
2. I do not give a pass to white members of the GOP as evidenced by my supporting challenger Lee McGroarty over my congressman Gary Miller. Gary voted for the bailouts that have cost us billions of dollars. I think $350 billion on HR 3221 Roll Call 301 when he was the only Republican in CA to vote AYE.
We both can agree that Republicans have signed legislation that you and I disagree with. The down side is that without that support we are labelled the part of NO.
And lastly. You have seen me comment on this blog that as a registered Republican I never voted for Arnold. I cast my votes for Tom McClintock and libertarian Art Olivier with whom I attended monthly political information meetings in LA.
Larry,
You are usually very fair, but this post was lacking in that regard.
Trying to pin the pension crisis on Correa without mentioning the fact that the bill in question passed with major support from Republicans is definitely unfair.
There are a lot of Republicans with blood on their hands with regard to the pension crisis.
Gilbert has been doing the same thing by trying to pin Mission Viejo’s benefits problem on two people who weren’t even on the council when they were voted in. In fact, in 2002 Ledesma and Reavis, both backed by Gilbert and Morton voted to spike benefits from 2% to 2.7%. Meanwhile Kelly is looking into raisng the retirement age to something more appropriate and Gilbert works to attack her. Hypocracy abounds Art.
LBM
I will be looking at my policy manual to tell you exactly what we voted for and when.
I really do appreciate Mr. Gilbert’s tireless work to expose pension abuse. I agree with him that this is the single biggest issue facing California today. It used to be that government jobs meant a little less pay but returned stability. Government job pay packages have now expanded to the point where many studies show that they are in excess of their private sector counterparts. Add to that the fact that a private company sets aside about 5% of salary for employee retirement programs while public sector jobs must set aside approximately 80% of salary and you have a disconnect that threatens the economic health of the state.
Unfortunately the debate in the comments above is symptomatic of conservative debate on the issue which is a blame game over who did what rather than working together to fix the system.
Of late I am using our vehicle rear view mirrors to see how we got to where we are heading today.
It was that analogy that led me to researching the background of our state’s public sector pension dilemna for which we are on the hook. i.e. Our windshield is much larger than our rear view mirrors because it is more important to see where we are headed vs where we have been.
However, we need to peel this issue back to it’s core. Art is correct in that members of both parties did sign on but someone had to start the ball rolling. I cannot ignore that fact.
Mr LBM is blowing smoke as I have supported Cathy Schlicht’s campaign promise to rid our remaining council members access to around $250,000 each of taxpayer funds called lifetime health care. He is quick to point out the cost of recent city elections that required a fixed number of voter signatures to get on the ballot. If we add Lance MacLean to Trish Kelley and Frank Ury, we have saved around $750,000 in potential obligations for that self serving perk. Somehow he refuses to acknowledge that factoid.
Actually Larry the only councilperson so far that has asked to raise the retirement age is Kelly. Schlichtz was just playing politics as usual and the entire city knows it. Her motion had no real effect on what benefits will ultimately be paid out, but Kelly’s motion that started a study will. Simple logic.
And I assume Gail realized I was correct in how she voted in 2002 or we would have heard back. So smoke I’m not blowing. But someone around here is.
LBM
This story is about Lou Correa and a 1999 vote in the Assembly . As such you are off base.
However. Did you attend any of Cathy’s campaign meetings?
Instead of giving her credit for persistence in correcting a wrong, based on a 2008 campaign promise, it is killing you that she was able to get the majority to support her effort. Ask her or anyone in Mission Viejo how much time I spent with her during the campaign.
Mr. LBM. The next time you are off topic on one of my posts I may resort to deleting it.
Hey Larry, calm down. You really don’t like being wrong. At the 9/3/02 meeting the vote was unamious to raise the pension from 2. to 2.7 which has cost the city millions of dollars. At that meeting you objected to an invitation from the Mission Viejo Masjid for a “day of unity and prayer.” That is taken directly from the meeting’s minutes. My point is your attack on Lou Correa is completely disengenious. Why didn’t you object to the vote on 9/3 when it was clear it would cost our city major money? Why have you given Reavis and Ledesma a pass all these years? Ladesma voted in those health benefits in the first place. See what I’m saying. You really can’t condemn Correa unless you’re willing to condemn Reavis and Ladesma.
Cathy didn’t correct a wrong. The benefits had already been signed off on and the papers three council people signed were legal and would hold up in court.
One wonders what you really want.
LBM. Keep it up . This post is about Lou Correa’s role in 1999. If you repeat this mantra again I promise to delete your SPAM