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Our views: Oregon needs deep examination of PERS solutions

Task force offered a broad picture

Published on November 6, 2017 1:00AM


The best idea to come from Gov. Kate Brown’s PERS task force was creating a matching fund to help schools and local government pay for their pension liabilities.

The Public Employees Retirement System serves some 900 public employers in addition to state government. A state match — say, 25 cents on the dollar — could encourage faster action by those cities, counties, school systems, fire districts, community colleges, public universities and other entities.

These governments and the state need to come up with $25.3 billion to fully fund PERS’ obligations to retirees. Until they act, PERS will consume more and more of their operating budgets, meaning less money for programs and services.

How would the state pay for those matching dollars? Ah, that’s the rub.

And for local governments and schools, their current usually overshadow future obligations. How would they come up with the money to gain a state match? That’s another rub.

In its report delivered to the governor on Wednesday, the PERS task force didn’t provide the answers.

The group of seven financial experts emphasized that it was not making recommendations. Instead, it came up with a list of ideas that could deserve study. They range from nonstarters such as privatizing state universities to reasonable proposals like setting up the matching fund and selling surplus state land.

Except the state doesn’t know what it owns. Individual agencies do, or at least they should. But the task force discovered there is no overall inventory of state-owned land and property.

That underscores the weakness of the task force. It convened in July but no one acted to have that inventory created by the time the task force held its fourth and final meeting in October. Meanwhile, the gap in PERS reserves continued to grow by billions of dollars.

With a complete inventory in hand, the task force could have made — or at least explored — the often-difficult decisions of which surplus lands to sell and which to hold for future use. That work had seemed a key role when Brown appointed the task force. Members did come up with a few possibilities, such as selling the State Office Building in Portland and replacing it with less-expensive real estate.

As Brown and legislators prepare legislation for the 2018 Legislature, workable ideas may yet develop. But what the task force provided was a broad picture of PERS possibilities. What Oregon needed was a deep examination of PERS solutions.



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