By swapping debt, Treasurer Edwards will save Oregon $90 millionOne of the 2003 Oregon Legislature's finest achievements was a revision of the Public Employee Retirement System (PERS). Revising PERS was absolutely essential, because pension obligations were consuming school districts and municipal governments as well as the resources of state governments. PERS was an immense unfunded liability.
The mail ballot that is due by Sept. 16 contains Measure 29, which is the final element of the legislature's PERS package.
In simple parlance, Measure 29 would allow the state Treasurer to refinance $2 billion of the state's PERS debt. As Treasurer Randall Edwards notes, the financing technique in Measure 29 is commonly used by local governments. The state's unfunded PERS liability is currently costing 8 percent. The idea is to swap that out for a lower cost debt instrument, by using general obligation bonds.
By swapping out the debt, Treasurer Edwards can save the state about $90 million.
Oregon is not alone in its pension liability. Illinois has done a $10 billion dollar debt swap.
Because the legislature's strategy involves general obligation bonding, the state Constitution requires a popular vote.
Referral of Measure 29 had bipartisan support in the Legislature. It has attracted opposition only from a representative of the Libertarian Party.
Measure 29 is an absolutely essential element to getting Oregon out of its fiscal morass. We urge a "yes" vote.