de Blasio, Taxes, Pension Investments, and Universal Pre-K

In the first budget that Mayor de Blasio will have to submit, FY-2015, he will have to include an amount of $541.0M that represents the repayment of $472.5M in pension investment fees incurred in FY-2013 along with two years of 7% interest charges, $68.5M. Actually it will be little less because the public authorities will have to pick up $82.5M of the $472.5M cost.

In addition the FY-2015 pension costs will include $2.2B in missed investment earnings that the pension trustees failed to capture.

At the same time in order to fund universal pre-K Mayor de Blasio is trying to get Albany to raise the city income tax rate from 3.87% to 4.41% for income over $500,000.

Maybe it's time to clean house before traveling to Albany.

Stop the Bleeding - Public Pension Funds Under Attack - Report and NY Times article

I have been hammering the NYCERS trustees for several years about about their investment decisions, in particular, allocations to private equity, real estate partnerships, and hedge funds.

Now there is a growing record of how misplaced these investments are for public pension funds.

Read the October 20, 2013 NY Times article by Gretchen Morgenson, Ted Seidle's recap article in Forbes on the investigation to the assault on the Employee Retirement System of Rhode Island, and the broad sweeping expose in Rolling Stone magazine.

Here is the link to the full investigative report.

Maybe the new mayor could find the money for his pre-K program by stopping the bleeding of the pension funds by Wall Street.