(Corrects description of June 2012 ballot measure in the last paragraph.)
Five California mayors said they filed papers for a statewide ballot measure that would let local governments change retirement benefits for current workers, not just future employees, to have more flexibility to avert insolvency.
The measure, which will require more than 807,000 petition signers to qualify for the ballot, wouldn’t change pension and health care benefits government workers have already earned, the mayors of San Jose, San Bernardino, Santa Ana, Anaheim and Pacific Grove said today in a statement.
“Many of California’s public-employee retirement plans are simply unsustainable and it’s in everyone’s interest to provide the tools to fix the problem now before even tougher actions are necessary,” San Jose Mayor Chuck Reed said.
Surging retirement costs have hobbled California cities since the recession, contributing to municipal bankruptcies in Vallejo, San Bernardino and Stockton. The runaway costs stem from decisions made by elected officials when stock markets were soaring and retirement funds were running surpluses. Benefits were boosted to retain and recruit new workers.
The proposal “breaks the promise of a secure retirement made to millions of Californians, many of whom are ineligible for Social Security and have an average pension of $26,000 per year,” Dave Low, chairman of the labor-backed Californians for Retirement Security, said in a statement.
“It will allow public employers to unilaterally cut the retirement benefits promised to current teachers, firefighters, police officers and school-bus drivers,” said Low, whose organization represents more than 1.6 million current and former public workers.
The mayors aim to put the initiative on the November 2014 ballot, when voters will select the governor and the state’s members of Congress.
Voters in San Jose, California’s third-largest city, in June 2012 approved a ballot initiative allowing current employees to pay more to keep their existing retirement plan or switch to a more modest plan, and steering new employees into a lower-cost plan. Unions challenged the measure in court.
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