Andrew Edwards, Staff Writer
Posted: 05/24/2010 08:07:22 PM PDT
San Bernardino County’s attempt to negotiate pension concessions from sheriff’s deputies could signal a new trend: a rollback of the generous retirement packages public employees secured during the past decade.
The development is not universal – Rialto’s pension benefits are scheduled to increase in December.
But officials working for the county and other local governments say they are attempting to forestall future budget pressures by negotiating with employees to adopt two-tiered retirement systems.
Current employees do not lose pension benefits under these kinds of deals, but future hires may have to contribute more money to their retirement plans or work longer before they can max out their pensions.
In the case of San Bernardino County, the official view from the government center is that current pension plans are unsustainable.
“The county is headed for collapse in terms of retirement funding,” said county spokesman David Wert.
The county’s pension obligations under current plans for safety and other employees could increase its general fund obligations by $91 million within five years, Wert added.
Thus the county is asking the Safety Employee Benefits Association – a union that represents sheriff’s deputies, district attorney’s investigators, probation officers and other public safety employees – to give up a pay raise and reduce future hires’ retirement benefits.
The retirement proposal would phase at a retirement plan known as “3 at 50” for one called “3 at 55.” Doing so would result in future SEBA members having to work five more years than their colleagues to earn maximum retirement benefits. The “3 at 50” formula allows employees to retire at the age of 50 and receive 3 percent of their highest annual pay multiplied by the number of years they worked.
SEBA president Bill Abernathie has said the proposed retirement change is part of a concessions package worth $6 million and that the union’s position on the issue is now up to a vote of its members.
The union issued a ballot to its members on Friday, Abernathie said. The votes are scheduled to be tallied on June 14.
But the county is not only asking SEBA members to reduce future employees’ retirement benefits. The concessions package also includes a permanent trade-in of a postponed pay raise for a one-time cash bonus.
A description of the proposal shows that an employee earning $50 per hour would get a $3,380 bonus in exchange for giving up a 3.25 percent wage increase. That amount, however, is much more than most deputies earn. Deputies’ wages are in the neighborhood of $25 to $35 per hour.
The “3 at 50” formula is often given to California law enforcement officers and firefighters and allows covered employees with 30 years of service to retire at the age of 50 with a pension equal to 90 percent of their highest pay.
The formula’s supporters have described “3 at 50” as a valuable recruitment tool and proper compensation to police and firefighters.
Whatever the decision of SEBA’s members, “3 at 50” is only one benefit that may vanish for future public employees working for various agencies.
Redlands has also adopted a two-tiered system by changing new employees’ contribution requirements. The Redlands council voted in March to require general and management employees to contribute a portion of their earnings to the California Public Employee Retirement System that had previously been paid from the city treasury.
In nearby Orange County, supervisors reached a deal similar to what San Bernardino County officials want with SEBA – a February agreement to hire new deputies under a “3 at 55” program.
The “3 at 55” formula is too generous in the eyes of Orange County supervisor and fiscal hawk John Miracle, who said he voted against his county’s new plan even though he opposes “3 at 50.”
“Once an agency has it, everybody has to have it,” he said.
Rialto is bucking the developing trend by moving to institute “3 at 50” in December.
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