State and local pensions out of control -- Arnold to the rescue?

Following the lucrative examples set by the prison guards and education unions, cops and firefighters have been raking in the cash. All this begs the question, should state employees be allowed to unionize AT ALL? After all, isn't working for the government supposed to be about *public service*? Who said that public service should even pay competitively, let alone far more than what somebody would make in a similar job outside government? Unions were designed to represent workers in private employment, not be used against the people.

  Government managers ought to take big pay cuts too. It's outrageous for public servants to be making six figure salaries when the money for those pay checks comes from sales taxes, vehicle license fees, and other taxes and fees paid by Californians who may be poor or unemployed themselves!

              <<< Starchild >>>

Arnold aims at costly cop retirements
JAMES NASH
LOS ANGELES DAILY NEWS
STAFF WRITER

Saturday, January 24, 2004 - With cities and counties facing ballooning
costs for employee pensions, Gov. Arnold Schwarzenegger has set the stage
for a showdown with the Democrat-controlled Legislature and unions.

When Democrats won control of the Governor's Office and both houses of the
Legislature in 1999, they enacted legislation that let state law
enforcement officers and firefighters retire at age 50 with pensions of up
to 90 percent of their highest salaries - instead of 75 percent at age 60.
Most Republicans also voted for the measure.

Many cities and counties soon fell into line, and now the bills are coming
due. State and local government agencies are being hit with huge bills to
pay for the lucrative pension deals - as much as 40 percent of some cities'
payroll costs.

Schwarzenegger wants a two-tiered system for new hires that rolls back
pension benefits to pre-1999 levels, and is calling for state employees to
contribute 6 percent of their gross pay into the state retirement fund
rather than the current 5 percent.

He considers pension reform a major component of solving California's
long-term financial problems, said H.D. Palmer, a spokesman for
Schwarzenegger's finance department.

"If we don't do anything, the next big crisis we're going to face after the
budget crisis is the pension crisis," Palmer said. "We're going to have a
dialogue with the Legislature that we need to enact substantive, long-term
reforms to the state's pension systems."

Palmer wouldn't speculate what actions Schwarzenegger would take if
lawmakers resist his reforms.

The governor will not get his way easily. Public safety unions, among the
most powerful lobbies in Sacramento, vow to fight any attempts to reduce
the "3 percent at 50" pension plans, as they are called because officers
earn 3 percent of the salary toward their pension each year so that someone
who started at age 20 could retire at 50 with a full 90 percent pension.

"The unions are very sophisticated," said Stephen H. Silver, a Santa Monica
attorney who represents about 100 public safety unions, mostly in Ventura
and Los Angeles counties.

"The unions are not going to roll over on this issue. Most employers don't
want to take on their public safety unions. Most people feel that public
safety is a necessity rather than a luxury. I don't think it would be a
good idea to mess with a necessity."

City officials say the drain of pension payments is threatening to erode
public services.

Simi Valley City Manager Mike Sedell said his city is paying nearly $3
million this year into the pension fund for police and firefighters, more
than triple the $711,000 it paid in 2001-02.

The trend, which is typical of cities that belong to the California Public
Employees Retirement System, results both from the poor performance of
CalPERS investments and from the enhanced pensions.

Simi Valley was among hundreds of California municipalities to switch to
more generous pension plans in 2000 and 2001. City councils in Burbank and
Glendale adopted similar plans, while Los Angeles voters in 2001 approved a
measure allowing police and firefighters to retire after 33 years of
service and collect 90 percent of their final year salary from the city-run
plan.

"Clearly, there's a big effect," Sedell said. "There's been belt-tightening
throughout the organization as a result."

In 1999, state lawmakers and then-Gov. Gray Davis approved a plan allowing
California Highway Patrol officers to retire at age 50 and collect a
pension equal to 3 percent of their final-year salary multiplied by years
of service.

The plan was among the most generous in the country, but CalPERS
forecasters said the state could afford it because the state's retirement
fund was swelling with profits from booming dot-com investments.

Davis received substantial campaign contributions from the Association of
California Highway Patrolmen, which represents CHP officers and opposes a
two-tiered pension system and other rollbacks.

Jon Hamm, chief executive officer of the CHP union, said officers
sacrificed salary increases in the 1990s in favor of better pensions. Hamm
said he hasn't seen any formal proposals to change pensions for highway
patrol officers but would oppose any two-tiered system.

"You will have membership that is one against the other if you set up a
two-tiered system," he said. "It is something that is very difficult to
work with in terms of doing the right thing for your members."

Assemblyman Keith Richman, R-Granada Hills, is studying proposals to roll
back CHP pensions to the "2 percent at 60" formula in place before the 1999
enhancement. Richman said he's also weighing a proposal in which employees
make specific contributions to their pensions.

"The issue of pension reform is a very important one," Richman said. "I am
pleased that Gov. Schwarzenegger included a first step for pension reform
in his budget and recognizes the problem for state and local government."
Even with reforms at the state level, pension costs to local governments
will continue to climb for the next few years, according to analysts'
predictions.

Local city councils and boards of supervisors would have to act on their
own to change pension benefits written into contracts with their unions.
Even if that happens, the poor performance of CalPERS investments would
continue to pressure local governments at least through 2007, analysts
estimate.

Officials for the Los Angeles pension fund said this month that they will
need $220 million from the city general fund this year, up from $120
million last year. The city's police and fire pension fund, which is
separate from the fund for other municipal employees, will need about
$127.5 million from the city's general fund this year, up from $86.5
million, officials said.

Sandra Dyson, chief health benefits administrator for the Los Angeles
municipal pension fund, attributed 90 percent of the increase to the poor
performance of the pension fund's investments.

Megan Taylor, a spokeswoman for the League of California Cities, said the
lobbying group hasn't taken a position on statewide pension reforms because
local council members and county supervisors are free to adopt their own
pension reforms.

That's only partly true, said John Johnston, chief executive officer for
Ventura County.

Once state lawmakers approved the CHP pensions, local police and fire
unions demanded similar plans for their members, and CalPERS assured local
leaders that its investment returns would cover much of the cost, Johnston
said.

Ventura County was one of a few holdouts that refused the "3 percent at 50"
plan for police and firefighters. Ventura County sheriff's deputies staged
four job actions in protest, and a few deputies left for other agencies,
Johnston said.

But the county's position has been validated by recent bad news on
pension-fund performance, he said. Ventura County is expecting to have to
contribute $63 million into its employee pensions next year, up from $10
million during the current year.

The news would be much worse had the county adopted the "3 percent at 50"
plan, with about $39 million in additional costs, Johnston said.

"We dodged a $40 million bullet but we're still having to deal with losses
in the stock market," he said.

Few local leaders had the courage or foresight to question the long-term
consequences of the sweetened pension deals, Johnston said.

"Nobody stepped in to say, How the hell could you pay for this?" he said.
"The fact is, somebody has got to pay for this stuff."

Dear Starchild;

Today, being a " Public Servant " no longer has the meaning of yesteryear with its connotation of dedicated public service. Today with the heavy massive campaign contributions from unions to the re-election campaigns of legislators it means feeding at the public trough. It also means the top heavy managerial bureaucracy will also make certain it gets its fair share. Even to the detriment of the lower paid clerical and administrative personnel.

Last week the discussion group received an e-mail showing who the supporters were of the ballot initiative to change the majority from 2/3Rd's to 55% for spending. These are the same people who are saying I'm going to get mine by taking from yours in their pension and benefits package demands.

Traditionally, police and firefighters were given pensions based on 25/50. Twenty-five years of service and a minimum of 50 years of age. This was because the job at the street cop and firefighters (who pull hose) levels was acknowledged to be physically and mentally debilitating.

However, with the resurgence of union campaign contributions the legislators heads were swiveled by the money. No one did the math on what the immediate impact was for the be-knighted group and what the impact was for all others. Namely the taxpayers. Then there was no long rang impact models done for the be-knighted group and the impact once again on the taxpayers.

Yes, you are also correct that the working poor are paying the heaviest burden. Their taxes are paying for the benefits and pension they themselves are unable to afford. They have no money left over after paying income taxes and payroll taxes. They are lucky enough to have enough for a roof over their heads and food for their families.

The only way the viscous circle can be broken is for major reform of both taxes and campaign funding. However, this is extremely unlikely to happen as the people needed for the enactment of the reforms are the same people who are the prime beneficiaries.

Ron Getty
SF Libertarian

P. S. Starchild, there's a new book reported on in todays Chronicle Book Review called " Stupidity and Tears - Teaching and Learning Under Pressure " by Herbert Kohl. According to the review it's about how schools perpetuate ignorance, and how schools could function more effectively and justly. It may help promote some ideas for you and questions to ask about SF schools in your run for Board.

Starchild <sfdreamer@...> wrote:
Following the lucrative examples set by the prison guards and
education unions, cops and firefighters have been raking in the cash.
All this begs the question, should state employees be allowed to
unionize AT ALL? After all, isn't working for the government supposed
to be about *public service*? Who said that public service should even
pay competitively, let alone far more than what somebody would make in
a similar job outside government? Unions were designed to represent
workers in private employment, not be used against the people.

Government managers ought to take big pay cuts too. It's outrageous
for public servants to be making six figure salaries when the money for
those pay checks comes from sales taxes, vehicle license fees, and
other taxes and fees paid by Californians who may be poor or unemployed
themselves!

<<< Starchild >>>

Arnold aims at costly cop retirements
JAMES NASH
LOS ANGELES DAILY NEWS
STAFF WRITER

Saturday, January 24, 2004 - With cities and counties facing ballooning
costs for employee pensions, Gov. Arnold Schwarzenegger has set the
stage
for a showdown with the Democrat-controlled Legislature and unions.

When Democrats won control of the Governor's Office and both houses of
the
Legislature in 1999, they enacted legislation that let state law
enforcement officers and firefighters retire at age 50 with pensions of
up
to 90 percent of their highest salaries - instead of 75 percent at age
60.
Most Republicans also voted for the measure.

Many cities and counties soon fell into line, and now the bills are
coming
due. State and local government agencies are being hit with huge bills
to
pay for the lucrative pension deals - as much as 40 percent of some
cities'
payroll costs.

Schwarzenegger wants a two-tiered system for new hires that rolls back
pension benefits to pre-1999 levels, and is calling for state employees
to
contribute 6 percent of their gross pay into the state retirement fund
rather than the current 5 percent.

He considers pension reform a major component of solving California's
long-term financial problems, said H.D. Palmer, a spokesman for
Schwarzenegger's finance department.

"If we don't do anything, the next big crisis we're going to face after
the
budget crisis is the pension crisis," Palmer said. "We're going to have
a
dialogue with the Legislature that we need to enact substantive,
long-term
reforms to the state's pension systems."

Palmer wouldn't speculate what actions Schwarzenegger would take if
lawmakers resist his reforms.

The governor will not get his way easily. Public safety unions, among
the
most powerful lobbies in Sacramento, vow to fight any attempts to reduce
the "3 percent at 50" pension plans, as they are called because officers
earn 3 percent of the salary toward their pension each year so that
someone
who started at age 20 could retire at 50 with a full 90 percent pension.

"The unions are very sophisticated," said Stephen H. Silver, a Santa
Monica
attorney who represents about 100 public safety unions, mostly in
Ventura
and Los Angeles counties.

"The unions are not going to roll over on this issue. Most employers
don't
want to take on their public safety unions. Most people feel that public
safety is a necessity rather than a luxury. I don't think it would be a
good idea to mess with a necessity."

City officials say the drain of pension payments is threatening to erode
public services.

Simi Valley City Manager Mike Sedell said his city is paying nearly $3
million this year into the pension fund for police and firefighters,
more
than triple the $711,000 it paid in 2001-02.

The trend, which is typical of cities that belong to the California
Public
Employees Retirement System, results both from the poor performance of
CalPERS investments and from the enhanced pensions.

Simi Valley was among hundreds of California municipalities to switch to
more generous pension plans in 2000 and 2001. City councils in Burbank
and
Glendale adopted similar plans, while Los Angeles voters in 2001
approved a
measure allowing police and firefighters to retire after 33 years of
service and collect 90 percent of their final year salary from the
city-run
plan.

"Clearly, there's a big effect," Sedell said. "There's been
belt-tightening
throughout the organization as a result."

In 1999, state lawmakers and then-Gov. Gray Davis approved a plan
allowing
California Highway Patrol officers to retire at age 50 and collect a
pension equal to 3 percent of their final-year salary multiplied by
years
of service.

The plan was among the most generous in the country, but CalPERS
forecasters said the state could afford it because the state's
retirement
fund was swelling with profits from booming dot-com investments.

Davis received substantial campaign contributions from the Association
of
California Highway Patrolmen, which represents CHP officers and opposes
a
two-tiered pension system and other rollbacks.

Jon Hamm, chief executive officer of the CHP union, said officers
sacrificed salary increases in the 1990s in favor of better pensions.
Hamm
said he hasn't seen any formal proposals to change pensions for highway
patrol officers but would oppose any two-tiered system.

"You will have membership that is one against the other if you set up a
two-tiered system," he said. "It is something that is very difficult to
work with in terms of doing the right thing for your members."

Assemblyman Keith Richman, R-Granada Hills, is studying proposals to
roll
back CHP pensions to the "2 percent at 60" formula in place before the
1999
enhancement. Richman said he's also weighing a proposal in which
employees
make specific contributions to their pensions.

"The issue of pension reform is a very important one," Richman said. "I
am
pleased that Gov. Schwarzenegger included a first step for pension
reform
in his budget and recognizes the problem for state and local
government."
Even with reforms at the state level, pension costs to local governments
will continue to climb for the next few years, according to analysts'
predictions.

Local city councils and boards of supervisors would have to act on their
own to change pension benefits written into contracts with their unions.
Even if that happens, the poor performance of CalPERS investments would
continue to pressure local governments at least through 2007, analysts
estimate.

Officials for the Los Angeles pension fund said this month that they
will
need $220 million from the city general fund this year, up from $120
million last year. The city's police and fire pension fund, which is
separate from the fund for other municipal employees, will need about
$127.5 million from the city's general fund this year, up from $86.5
million, officials said.

Sandra Dyson, chief health benefits administrator for the Los Angeles
municipal pension fund, attributed 90 percent of the increase to the
poor
performance of the pension fund's investments.

Megan Taylor, a spokeswoman for the League of California Cities, said
the
lobbying group hasn't taken a position on statewide pension reforms
because
local council members and county supervisors are free to adopt their own
pension reforms.

That's only partly true, said John Johnston, chief executive officer for
Ventura County.

Once state lawmakers approved the CHP pensions, local police and fire
unions demanded similar plans for their members, and CalPERS assured
local
leaders that its investment returns would cover much of the cost,
Johnston
said.

Ventura County was one of a few holdouts that refused the "3 percent at
50"
plan for police and firefighters. Ventura County sheriff's deputies
staged
four job actions in protest, and a few deputies left for other agencies,
Johnston said.

But the county's position has been validated by recent bad news on
pension-fund performance, he said. Ventura County is expecting to have
to
contribute $63 million into its employee pensions next year, up from $10
million during the current year.

The news would be much worse had the county adopted the "3 percent at
50"
plan, with about $39 million in additional costs, Johnston said.

"We dodged a $40 million bullet but we're still having to deal with
losses
in the stock market," he said.

Few local leaders had the courage or foresight to question the long-term
consequences of the sweetened pension deals, Johnston said.

"Nobody stepped in to say, How the hell could you pay for this?" he
said.
"The fact is, somebody has got to pay for this stuff."