All issues these days seem to lead back to the pension issue, and the latest Southern California battle over rising water rates is no exception. Some cities are responding to rising rates from the privatized Golden State Water Company by coming up with their own taxpayer-funded plans to take over the water systems.
Obviously, private water systems are monopoly providers and aren't fonts of free enterprise, but these systems cannot offload their public employee costs onto taxpayers. Their rates -- determined as they are in a bizarre Soviet-esque system operated by the Public Utilities Commission -- must encompass the full cost of services. Public providers can run up unfunded liabilities. Golden State, for instance, recently shifted its employees from a defined-benefit pension plan to a defined-contribution plan. Here is my column on the subject.
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