Orange County Grand Jury Reports $3.3 Billion Retirement Hole
Orange County city officials have promised workers over $3.3 billion in retirement benefits they do not have. Orange County cities have promised workers $10.45 billion in retirement benefits, yet have set aside only $7.13 billion to pay those benefits. Despite that alarming news, there are positive aspects to the story as well. Thanks to CalPERS, the city will be forced to deal with that debt in the coming years.
Many predict the county will lose services and programs trying to pay down the debt, though currently, predictions do not foresee any dangers of Orange County suburbs.
The Orange County Grand Jury revealed these numbers after examining unfunded liabilities in the Orange County system. They also urged greater transparency.
In what has been called a “slightly-scolding tone,” the Grand Jury report urged the county to take action. “If unfunded pension liabilities are not addressed, cities could reach a crisis where outcomes are painful enough that they affect the quality of life in Orange County,” the report said.
The numbers show that on average, cities in Orange County have only 68.2 percent of the funds they need stashed away—which is far less than the 80 percent figure many strive for. Some experts say 80 percent isn’t quite enough.
Costa Mesa was shown to be the most underfunded city at 61.9 percent, whereas cities such as Laguna Niguel, Lake Forest, and Aliso Viejo are tied for the most well-funded at 77.2 percent.
Read more about the county’s retirement woes here.