Point of View
Posted: 07/24/2012 03:23:34 PM PDT
Three cities San Bernardino could learn from are San Francisco, San Jose and San Diego. All three are older, larger charter cities. All three have dealt with the employee pension issue proactively as an effort to avoid bankruptcy.
The main idea is simple – employees must pay the employee share of pension costs.
San Francisco went first. It began a couple of years ago when the city public defender Jeff Adachi created a citizen initiative to reform public employee pensions. He gathered the signatures and his initiative came very close to passing. The San Francisco public employee unions had to spend hundreds of thousands of dollars to defeat it. Adachi learned from that first battle and came back the next year with a new and improved initiative.
At that time, the newly appointed mayor of San Francisco, Ed Lee had just decided to run for the office and seized the opportunity. He reached out to the unions and convinced them that Adachi’s measure would pass this time unless the voters were given a better alternative. Mayor Lee worked with the unions to create a compromise measure that was not as draconian as Adachi’s measure. The voters liked the compromise measure better and San Francisco voted for real pension reform in November 2011.
Today the employees are paying the employee share on a sliding scale. The highest paid workers pay the whole employee share and lower paid employees pay a smaller share.
San Jose and San Diego went a different route. The unions have opposed reform in both those cities. Elected leaders and citizens gathered signatures to put pension reform on the ballot. It passed by large margins in both cities but the unions have now moved their battles to court. Citizens in those cities now wait to see if the courts will respect the will of the people and allow cities to regain control of their budgets or if they will have to go back to the table to find a solution.
Pension costs in San Bernardino have nearly doubled in the past six years. The combination of new benefits that allow employees to retire at age 50 with 90 percent pay for the rest of their lives, which was approved in early 2006, and the stock market crash in 2008 have pushed rates through the roof.
To read entire story, click here.