July 7, 2007

Trying to Hide the pension mess from Taxpayers

Well Arnie is starting to act more and more like a Democrat. Great idea. Lets use secret bonds not approved by the voters to finance the pension mess. Whoops. That's illegal. Damn courts getting in the way! Well we don't want to ask the voters what to do...or do we? Hell they are stupid enough to pass most other bond issues we run up the flagpole so why not this one. I hope the taxpayers never figure out that they have to pay for all these bonds as well as all the interest on them and that it is all so the fat cat public employees can retire at 50, 15 years before the private sector, with at least twice the benefits.

Hats off to The Fullerton Association of Concerned Taxpayers (whom we linked to long ago) for catching this and nipping it in the bud so that that voters can at least try to stop this madness.

State loses bond battle
by Heather Dale 04-07-2007

US – Governor of California Arnold Schwarzenegger’s administration has lost its court case bid to issue US$560m in bonds to cover government pensions

The Third District Court of Appeal ruled that the State’s proposed “pension obligation bonds” are illegal because they were not submitted to voters as the Californian Constitution requires.

A court document stated: “Concluding the pension obligation is one imposed by the State on itself and, therefore, does not fall within an exception for obligations imposed by law. The court entered judgment against the Committee.”

Authorised by the Legislature and the governor in August 2004, the bonds were designed to pay a portion of the State’s contribution to the Public Employee Retirement System (CalPERS) for a single year.

The Fullerton Association of Concerned Taxpayers (FACT) was the only challenger to the bonds in a “validation” action brought by the State. In late 2005, Sacramento County Superior Court Judge Raymond Cadei ruled the bonds invalid under Article 16, Section 1.

The State appealed, argument was held by the Third District on 25 June, and this ruling is the result.

Pacific Legal Foundation attorney Harold Johnson, who represented FACT in challenging the bonds, said: “The court upheld the basic right of the people of California to chart their fiscal destiny and have the ultimate say over major state borrowing.

The court affirmed that the Legislature can’t saddle the people of California with major debt without first getting their permission. This ruling should also be a warning to spendthrifts in government. They can’t spend like tipsy sailors and automatically borrow their way out of the mess they make.”

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