Sunday, June 13, 2010

NY State Shell Game - Municipalities Borrow from Pension Fund to make Required Pension Fund Contributions

When it comes to pension funding schemes, NY governor David Paterson and the NY legislature have taken can-kicking to ever increasing levels of absurdity. Please consider State Plan Makes Fund Both Borrower and Lender. http://www.nytimes.com/2010/06/12/nyreg ... nsion.html

Gov. David A. Paterson and legislative leaders have tentatively agreed to allow the state and municipalities to borrow nearly $6 billion to help them make their required annual payments to the state pension fund.

And, in classic budgetary sleight-of-hand, they will borrow the money to make the payments to the pension fund — from the same pension fund.

As word of the plan spread, some denounced it as a shell game and a blatant effort by state leaders to avoid making difficult decisions, like cutting government spending or reducing pension benefits.

“It’s a classic Albany example of kicking the can down the road,â€