Employees will pay into plan; 2-tier system OK’d
Monica Rodriguez, Staff Writer
Created: 07/13/2011 08:19:11 PM PDT
POMONA – City Council members have unanimously approved adjustments to some city employees’ retirement benefits.
Council members approved a resolution affecting executive management as well as members of the Pomona Mid-Management/Confidential Employees Association.
The resolution calls for employees in these two groups to pay a 7 percent contribution toward their retirement benefits. The city had been paying 6 percent of the executive employees’ contributions and 4 percent for Mid-Management and Confidential employees, according to a city staff report.
The arrangement is expected to result in a savings of about $600,000 a year, said Susan Paul, the city’s director of human resources and risk management.
Contribution adjustments, which went into effect July 1, are in-line with an agreement reached with employees and approved by the council at its June 20 meeting.
The adjustment is one that is hard for affected employees to take, said Bob Blough, general manager for the San Bernardino Public Employees Association, which represents the city’s mid-management and confidential employees.
City employees are experiencing the consequences of the public’s anger resulting from seeing how some public servants are retiring and receiving huge retirement packages, Blough said.
“In the first place, they’re not in the $100,000 club,” Blough said, adding the affected employees earn an average of $21 an hour and “they’re just average working people.”
“We understand and support the need for pension reform…but to take pensions away from people who work for a living is very difficult to take,” he said.
In the end, such arrangements do little to address cities’ budget problems when what is needed is a way to address the retirement of all public employees, including the high-wage earners, Blough said.
Negotiators for Pomona presented the proposal for concessions, but after seeing there was little room for negotiations and knowing the city could impose its offer, employees “reluctantly accepted the concessions,” he said.
A similar proposal has been presented to members of the Pomona City Employees Association, a group made up of the city’s general employees and is also represented by the San Bernardino Public Employees Association, Blough said.
However, the city and the general employees are still in negotiations, he said.
This week, the council also approved a resolution stating its intent to adopt an urgency ordinance at its Aug. 1 meeting leading to amend the contract between the city and the California Public Employees’ Retirement System.
The amendment will lead to establishing a two-tier retirement system for city employees with the exception of police department sworn personnel.
Currently, an employee who retires under the existing 2 percent at 55 program at 50 years old with 30 years of service would receive 47 percent of his or her final salary averaged out over one year, Paul said.
Under the new 2 percent at 60 program, a future employee retiring at the age of 50 with 30 years of service would get about 33 percent of his or her final salary averaged out over three years, Paul said.
The new program would affect future employees hired on or after Aug. 14.
Members of the Pomona Police Officers’ Association negotiated a two-tier retirement program last year.
Creating the two-tier system for city employees will result in a savings for the city over time but there will be some savings in the short run, Paul said.
Paul said that at this time many local government agencies are taking a look at retirement costs.
“There’s a lot of focus on retirement benefits and a need to make structural reforms,” Paul said. “It’s a discussion that is going on out there.”
To read entire story, click here.