Approve Issuance of Pension Obligation Bonds - YES
This is another big step forward for Corte Madera's fiscal responsibility. Like almost every public agency in California, Corte Madera faces a massive pension obligation debt—ours is to the tune of about $21.4 million. Until now, the payments on that debt required by CalPERS have varied wildly, making it difficult to predict future expenditures accurately. To make matters worse, CalPERS' investment of that money often underperforms their projections, leaving cities scrambling to catch up.
I voted to remove Corte Madera from that cycle of volatility by refinancing our pension debt as pension obligation bonds. In essence, rather than face large and unpredictable payments on our debt to CalPERS, this move will see Corte Madera issue enough bonds to pay off almost our entire pension debt, effectively swapping out our volatile pension payments for lower, predictable bond payments.
The benefits are twofold: not only does the move allow us to more accurately project future budgets and expenses, it also creates an annual savings for Corte Madera taxpayers of more than $800,000. We can then reinvest this savings into further paying down debt obligations, consolidating Corte Madera's position and further enhancing our fiscal footing.