Governor Brown’s 12 point pension reform plan that was released today outlines big changes to current and future public employees, including California state employees as well as employees of local governments, schools and special districts. The Governor’s plan, while probably outraging institutional Unions, probably does not go far enough for conservatives and conservative activist groups. The Governor’s pension reform plan cannot be implemented, in most cases, without bargaining with the employees and employee organizations it affects. One thing is for sure though, the employee associations better bring it’s “A” game to the bargaining table to discuss the Governor’s plan. With the right approach, many of the employer needs outlined in the pension reform plan can be accommodated while preserving the fundamental elements of California public employee pensions. The California public employee pension system has been the cornerstone of public service for over 2 generations. That system, which has supported probably the finest public sector workforce in the country, needs to be preserved the common sense way.
Main Points of Governor Brown’s Pension Reform Plan
1. Equal Sharing of Pension Costs: All Employees and Employers
2. “Hybrid” Risk-Sharing Pension Plan: New Employees
3. Increase Retirement Ages: New Employees
4. Require Three-Year Final Compensation to Stop Spiking: New Employees
5. Calculate Benefits Based on Regular, Recurring Pay to Stop Spiking: New Employees
6. Limit Post-Retirement Employment: All Employees
7. Felons Forfeit Pension Benefits: All Employees
8. Prohibit Retroactive Pension Increases: All Employees
9. Prohibit Pension Holidays: All Employees and Employers
10. Prohibit Purchases of Service Credit: All Employees
11. Increase Pension Board Independence and Expertise
12. Reduce Retiree Health Care Costs:
State Employees Savings will be in the neighborhood of $900 million per year to the State.