Skip to main content

It turns out the Wisconsin "Budget Repair Bill" adds costs to Wisconsin's pension system!

Link to article on Wisconsin Act 10 from Wisconsin State Journal/St. Paul Pioneer Press

I'm just going to let the first part of the article speak for itself:

Wisconsin's controversial 2011 collective bargaining law may add $87.5 million to state retirement system costs next year due to a little-noticed change that will boost employee benefits.

The unanticipated costs aren't a back-breaking amount for the massive retirement fund, but they illustrate why laws that alter the complex retirement system should be examined carefully before enactment, said Robert Conlin, secretary of the Department of Employee Trust Funds.

Conlin's predecessor, David Stella, stepped down in January saying that elected officials disregarded his plea for a thorough examination of how changes in the law would affect the $82 billion pension fund.

Under provisions of the collective bargaining law, government employers -- state agencies, local governments and school boards -- are saving money because they no longer pay the employee's portion of payroll contribution to the pension fund.

But they are saving a little less than earlier believed, according to new financial projections provided to ETF board members Thursday, June 21.

It's possible that more surprises will be found later this summer when the department's 2011 financial books are closed and final 2013 contribution projections are approved in September, said Brian Murphy, president of Gabriel Roeder Smith and Company, the department's actuarial firm.

Previous year numbers are usually finalized in the spring, and contribution rates approved in June. Bookkeeping is delayed this
year because of several changes made to the retirement system by the union law and the biennial budget.

It's complicated because so many fluid factors -- salary levels, retirement rates and investment returns -- influence the finances of the state pension fund. Overall, employer and employee contributions to the fund totaled $1.5 billion in 2010, the latest year for which exact data is available. Under union contracts, nearly all of it was paid by employers.

Act 10 was Gov. Scott Walker's signature legislation, designed to rein in government costs. Spokeswoman Julie Lund said Walker wants a strong pension fund, but she didn't directly address Stella's criticism

My jaw dropped when I saw that article. It looks like Governor Walker and Republican legislators only took in political considerations when the Act 10 was formulated. They didn't consider what the fiscal effects of Act 10 would be on Wisconsin's public retirement system, in fact, they threw David Stella, who was the secretary of the Department of Employee Trust Funds, under the bus to get what they want. Also, "more surprises" may be found by accountants later this year. I'm certain that Wisconsin taxpayers were screwed royally. Also, Julie Lund is a typical Walker spokesperson, as anyone who is a spokesperson for Walker won't answer hardball questions. There was a YouTube video I saw not too long ago of Walker spokesperson Ciara Mist, who, when asked questions about Walker's travel schedule, tried to change the subject.

Governor Walker and his Republican cronies in Wisconsin have always been about doing whatever it takes to get what they want. This is a textbook example of how Walker and Company operate.

Mitt Romney wants to take Scott Walker's "divide and conquer" agenda to the federal level if he is elected President. We can't allow Mitt Romney to divide and conquer the American people, so that's why I'm urging everyone to vote for President Obama on November 6, because we can't let Mitt Romney "drop the bomb" on all Americans.

Originally posted to Aaron Camp on DailyKos on Sun Jun 24, 2012 at 04:25 AM PDT.

Also republished by Badger State Progressive, ClassWarfare Newsletter: WallStreet VS Working Class Global Occupy movement, Progressive Hippie, and German American Friendship Group.

Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags


More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site