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Compton reviews plan to pay down CalPERS unfunded liability; staff says payoff could lower pension levy by about 20%
Summary
At an Oct. 28 workshop, a city-hired consultant outlined scenarios for paying a portion of Compton’s CalPERS unfunded actuarial liability — staff suggested a large one-time payment (examples given: roughly $65–$75 million) that could save interest and reduce the city’s pension levy by about $7.2 million (~20%). Council took no final vote.
Compton’s City Council and staff on Oct. 28 heard a detailed presentation on the mechanics and costs of the city’s CalPERS unfunded actuarial liability (UAL), and about how a large, one‑time payment could lower long‑term pension costs.
At a workshop, consultant Dan Matu Chevich told the council that CalPERS bills shortfalls that accrue interest (he cited a 6.8% annual accrual rate) and that the city is facing a combined UAL for its miscellaneous, fire and police plans of roughly $152 million. "And so they send you a bill for that unfunded liability that ... accrues interest at 6.8% per year," Chevich said.
Why it matters: paying down a principal balance now would reduce the amount of interest the city pays over time. Staff framed the tradeoff as a choice…
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