In part, the active approach that Mayor Villaraigosa has taken is because the decisions made by those boards can have a far reaching impact on the city’s finances. If a pension board cuts its earning projections, that means the city is on the hook for a greater portion of the pension’s liabilities. Villaraigosa has said that means layoffs.
To protect the jobs of city employees, and some say to help maintain favor in the city, he has begun working to influence the inner workings of the boards. In some cases, he’s replaced board members who voted against him. In others, his lawyers have told boards to disregard court cases and precedents.
From the Los Angeles Times:
Worried about the prospects of a new round of budget cuts during his last two years in office, Los Angeles Mayor Antonio Villaraigosa has grown increasingly bold – some say too aggressive – in his attempts to influence panels that guide the city’s huge retirement funds.
Two weeks ago, Villaraigosa warned a seven-member board overseeing pensions for civilian employees that a new round of layoffs would “almost certainly” occur if the panel scales back income projections for its $11-billion portfolio.
Read the full article here.