"I am not a crook!" ~ Richard Nixon
Shell game scam alert: Will there be something left for the bond holders, or the pensioners, or any taxpayers capable of paying for it? Or nothing left anywhere?
What's Andrew Cuomo or Comptroller DiNapoli doing about borrowing from the pension fund to pay contributions to the pension fund in 2011? Nothing, it's not so described in his budget or in his announced agenda.
Amortized means payments are extended over future years.
From Empire Center for New York Policy, "Starting in fiscal 2011-12, the contribution rates used to calculate the state’s pension bill will be allowed to increase by only one percentage point a year, starting at this year’s capped level. Billed contributions above that amount in any given year can be spread, or amortized, over 10 years, payable to the pension fund at a rate pegged to interest on taxable bonds, generally in the neighborhood of 5 percent. As part of the deal, the minimum contribution level is permanently fixed at 4 percent. Local governments have been given the option of joining this “rate mitigation program,” and many are already choosing to do so."
This is the applicable law: NY State Law RSS - Retirement and Social Security
Title 2 - ESTABLISHMENT, MANAGEMENT, SUPERVISION AND FINANCING
19-A - Employer contributions for the two thousand ten - two thousand eleven fiscal year and subsequent fiscal years. (allowing amortization or paying in this year's contribution over many years)
Pension Plan or Ponzi Scheme? "Now there is a new claimant to the title of Ponzi Perfection — The State of New York.…Another oddity of the plan is that the pension fund, which assumes its assets will earn [7.5%] percent a year, would accept interest payments from the state that would probably be 4.5 percent to 5.5 percent." "'Mr. DiNapoli, the comptroller, said: “We would view it more as an extended-payment plan.”
This NY State Shell Game also allows Municipalities to Borrow from Pension Fund to make Required Pension Fund Contributions
Is this Fiscal Insanity by the Fiscally Conservative Andrew Cuomo, or a scam? This is another reason why New York will default or go bankrupt. If this was a private company, they'd all be headed to jail, or, for the insane, to the asylum.
