By Jon Ortiz and Jim Sanders
Published: Saturday, Sep. 1, 2012 – 12:00 am | Page 1A
California lawmakers approved a package of changes Friday aimed at cutting costs for public pensions, sending legislation to Gov. Jerry Brown despite objections from both organized labor and Republicans unhappy with its scope.
Last-minute legislation to overhaul California’s workers’ compensation system also was headed to the governor as the final day of the legislative session drew to a close.
Senate President Darrell Steinberg said the pension deal cut a fine path between preserving traditional state and local pensions while making them affordable for government employers.
“I hope this puts this issue – which has so dominated the public discourse for a long time – if not away, at least off to the side so we can focus on some positive agendas,” Steinberg told reporters outside the Senate chamber after the vote.
The 40-member Senate cleared the measure 38-1. In the Assembly, 48 of 80 lawmakers supported the bill. Eight voted against it.
Assembly Republicans complained they were pressured to take a position on a flawed bill that didn’t surface until the final week of the session. Others complained the measure was political pandering to cost-conscious voters ahead of November elections.
“This, to me, is a very insincere ploy to go out before the voters and say we did some pension reform,” said Diane Harkey, R-Dana Point, “because you know how well that polls.”
The pension bill’s politics played out just a few hours after the California Public Employees’ Retirement System made clear that most of the estimated savings from pension reform won’t come until later years.
Because the most significant rollbacks apply as of Jan. 1, 2013 to new hires and not current workers, savings for the coming fiscal year will reach just $146 million at most, the state’s massive public pension fund estimated. Twenty years from now, annual savings would come to as much as $2.5 billion.
CalPERS estimated savings will total between $43.3 billion and $55.8 billion over 30 years. The figures aren’t adjusted for inflation and include local employers such as cities, counties and school districts.
The measure achieves those savings through several changes. The most significant for new workers: caps on how much of higher-earners’ pay counts toward their pensions, retirement formula rollbacks and later retirement ages.
All employees, regardless of hire date, also would have to split their normal pension costs with their employers 50-50. Employees hired before Jan. 1, 2013, however, would have until 2018 to pay more, depending on their contracts.
To read entire story, click here.