As Oakland prepares to end a costly 45-year property tax used for city employee pensions, officials are considering a new tax to address ongoing retirement benefit costs. This situation exemplifies a larger pattern of inadequate pension funding across California. The new tax should be temporary and lower while encouraging higher worker contributions. Oakland's financial challenges stem from a $130 million annual structural deficit and a legacy of fiscal mismanagement affecting pension funding, ultimately burdening current property owners with the costs of past governmental neglect.
Just as a hidden and exceptionally costly Oakland property tax to pay for city employee pensions winds down after 45 years, officials are planning another levy to offset the cost of retirement benefits.
It's time to end this fiscal recklessness. The city's current financial struggles, which include a $130 million annual structural deficit in the general fund, are so bad that a new tax might be needed.
The financial crisis could have been avoided if the city had properly pre-funded its pension plans.
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