146TH YEAR, NO. 146
DailyAstorian.com // TUESDAY, JANUARY 22, 2019
ONE DOLLAR
Cash flow
is latest
pension
headache
Basic solvency of the
state system in question
By TED SICKINGER
The Oregonian
Warnings about Oregon’s public pension
system have been relentlessly consistent for
nearly two decades. But a deficit of roughly
$26 billion, seesawing financial markets
and years of political inaction continue to
drive painful cost increases for schools,
municipalities and government employers
across the state.
The pension system’s appetite for more
dollars is the backdrop to every budget dis-
cussion. It was a wedge issue in the 2018
governor’s race. And it will lurk around the
legislative session that starts today, even if
Democrats decide not to take up legislation
to tackle the problem.
Even as Gov. Kate Brown proposes $2
billion in new taxes to fund schools, much
and potentially all of that money could
eventually disappear into the pension sys-
tem, leaving little for Brown’s promise of
smaller classes, more teachers or a longer
school year.
Now a new alarm is ringing, one that’s
triggering a different conversation among
the folks who manage the pension fund’s
investments. On the surface, it’s about
structuring the investment portfolio to meet
growing needs. But dig a little deeper, and
it’s also about the basic solvency of the pen-
sion plan.
The problem is cash flow, or more accu-
rately, negative cash flow.
In plain terms, that means the Pub-
lic Employees Retirement System pays
out far more than it takes in before invest-
ment earnings. The situation, given the
projected growth of benefit payments, is
unprecedented and important enough to
affect the “long-term viability of the plan,”
said Rukaiyah Adams, chair of the Oregon
Investment Council, the citizens panel that
oversees pension fund investments.
“No OIC has ever had to face this issue,”
she said. “No governor or treasurer has had
to face this issue. So, we’re approaching it
with measured, analytical care.”
Already, some financial experts think it
unlikely that public employers will ever pay
off the pension deficit. Others see the system
approaching a financial precipice that, with-
out drastic measures, could eventually leave
Oregon looking like Illinois, whose pension
system is on the verge of insolvency.
Focus on cash
Allen Alley, a former tech executive,
Republican gubernatorial candidate and
technology investor, suggests that poli-
cymakers stop focusing on the actuarial
mumbo jumbo and the complex account-
ing, and start looking at the actual cash
flowing out of the system. Bottom line, he
calculates, public employers’ collective bill
for retirement benefits over the next three
decades will be about $225 billion. That’s
just for existing employees. New employ-
ees will increase the bill.
“As a CEO of a company, you think
about cash,” he said. “What’s the check I
have to write and where’s that money going
to come from?”
Last year, PERS took in roughly $1.4
billion in contributions from employers to
Katie Frankowicz/The Daily Astorian
Visitors to the replica of Fort Clatsop at Lewis and Clark National Historical Park were unable to access parts of the facility during
the government shutdown.
National park
weathers shutdown
Lewis and Clark remains relatively pristine
By KATIE FRANKOWICZ
The Daily Astorian
T
Photos by Colin Murphey/The Daily Astorian
ABOVE: A sign in the window of the visitor center at the park describes
conditions during the shutdown. BELOW: Trails in and around the Lewis
and Clark National Historical Park were still open despite the government
shutdown.
he trash bins are full, the bathrooms are
getting close to full and downed trees
cross some trails, but, overall, Lewis and
Clark National Historical Park near Warrenton
looks pretty clean.
The government shutdown — now on its
32nd day — has not been as kind to other
national parks across the country, where bad
behavior and trash dumping threaten fragile
natural areas. In California, visitors cut down
protected Joshua trees, while residents near
Yosemite say it’s a “free for all” in the park as
garbage and human waste pile up.
People often assume winter is a slow time
of year at Lewis and Clark. But the park, home
to the Fort Clatsop replica and the site of the
encampment where the Corps of Discovery led
by Meriwether Lewis and William Clark spent
the winter more than 200 years ago, remains a
draw year-round.
Locals and visitors hike the trails daily. On
Monday, Martin Luther King Jr. Day and a hol-
iday for many people, cars filled a small park-
ing lot at a connection to the Fort to Sea Trail
and people wandered around the visitor center.
Park staff offer educational programs,
demonstrations and other events and services
throughout the year. The partial shutdown has
meant canceled school field trips, hiring delays,
lost monitoring data in natural resource proj-
ects and disappointed out-of-town visitors who
might have made a special trip to the coast just
to experience Fort Clatsop.
On Monday, Sherrie Pickard, of Ridgefield,
Washington, snapped a photo of her 10-year-old
grandson, Nixon Graham, in front of the closed
and locked bunkhouses inside the Fort Clatsop
See Park, Page A7
See PERS, Page A7
Big quakes follow ‘silent slip’
New research
from Oregon State
By KALE WILLIAMS
The Oregonian
Ross William Hamilton
A seismograph at Portland State University shows the shaking
from the Spring Break Quake in 1993, thought to be the third-
strongest earthquake centered in Oregon.
Researchers at Oregon
State University have found
a new explanation as to why
foreshocks often precede
large earthquakes.
Large quakes appear
to follow a short period of
“shallow mantle creep” and
“seismic swarms,” accord-
ing to the study, which was
published Monday in the
the academic journal Nature
Geosciences.
The findings shed new
light on a phenomenon
called “silent slip,” in which
parts of the Earth’s crust are
displaced along a fault line,
but without any seismic
activity.
In simpler terms, silent
slip is when the Earth
moves, but there’s no earth-
quake. That silent slip can
lead to actual seismic activ-
ity, though, said co-author
Vaclav Kuna, a graduate stu-
dent in geology and geo-
physics at the university.
Vaclav and other research-
ers deployed 55 seismome-
ters along the Blanco Trans-
form Fault off of the Oregon
Coast for a year.
“It’s a very seismically
active fault that generates
significant earthquakes at
higher rates than the major-
ity of faults on land, mak-
ing it ideal for studying the
process of earthquake gen-
eration,” Kuna said in a
statement.
Transform faults occur at
the edges of tectonic plates
where the movement is
mostly horizontal. The Cas-
cadia Subduction Zone, the
Pacific Northwest’s most
widely known producer of
large quakes, is a subduction
See Quakes, Page A7