Check out this crap from CA -
Does these unions prefer everyone just go bankrupt?
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County supervisors delay pension reform discussion after unions balk
By Troy Anderson, Staff Writer
Posted: 10/19/2010 07:14:31 PM PDTUpdated: 10/19/2010 07:44:27 PM PDT
Despite learning Tuesday that Los Angeles County faces a $26 billion tab over coming decades to cover pension and retiree health care costs, the Board of Supervisors delayed pursuing reforms to the retirement system after unions threatened legal action.
The supervisors were preparing to consider a series of reforms that included raising the county's minimum retirement age and asking employees to contribute more to their plans.
But unions hinted at legal action to stop the reforms, and said the political process would be more difficult than the supervisors expected.
"You might want to check with your counsel on your legal position in voting on this motion because, in our view, it's an unfair labor practice," said Blaine Meek, chairman of the Coalition of County Unions. "Second, you have many hurdles to go through in getting pension reform. It's not just about negotiating with the unions. You have to get legislation passed."
After the supervisors retreated to closed session for several hours, they emerged to announce a 4-0 vote to delay any possible reforms until the next contract talks, expected in mid-2012. They asked county CEO Bill Fujioka to prepare a series of options to help guide what reforms would be pursued at that time.
The decision came after County Employees Retirement Association Chief Executive Officer Gregg Rademacher told supervisors that the pension system has $5 billion in unfunded liabilities, and taxpayers
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are also on the hook for $21 billion to cover health care for retired county employees.
The board members appeared shocked by the numbers and questioned why more steps hadn't been taken earlier to curb costs.
"I don't understand why LACERA wasn't aggressive in attempting to initiate various reforms to reduce this liability," said Supervisor Michael Antonovich. "This ($26) billion liability is much greater than our county's entire budget that serves 88 cities and 1.5 million people in unincorporated communities."
The county has an annual budget of approximately $23 billion.
Previous estimates for the county's retiree health care liability have ranged in size from $9 billion estimated by a private health care foundation in a 2006 study, to anywhere between $13 billion to $20 billion estimated by some county officials in 2007.
Antonovich had called for the CEO report in June after the supervisors voted to boost annual taxpayer contributions to LACERA by $200 million to $987 million this year. Without reforms, Rademacher warned that amount could reach up to $2 billion by 2015.
Antonovich then proposed a series of reforms to the pension system that were expected to save the county $200 million in annual pension costs.
His original motion, based on recommendations from Fujioka, called for increasing the minimum retirement age for county employees and the amount of money current and new employees contribute to their pension plans. It also called for pensions to be based on the highest consecutive three-year average salary as opposed to a single highest year salary.
The decision not to proceed with the reforms now came after board chair Gloria Molina said the county doesn't need pension reform and the unions threatened legal action. Molina was absent from the closed session portion of the meeting and did not vote.
The unions recently reached a tentative agreement that allows the county to reduce its contribution to employees deferred compensation - or 401(k)-type - plans.
Jon Coupal, president of the Howard Jarvis Taxpayers Association, said he wasn't surprised the supervisors balked at making the reforms immediately.
"Much like GM stopped becoming a car company and really became an employee benefits company that built cars on the side, government agencies in California are becoming entities whose primary purpose is to provide benefits to employees, not provide public services," Coupal said. "They will be providing public services as only a tangent to their primary responsibility of keeping bureaucrats and elected officials well fed and financially secure."
The closed session vote comes as rapidly rising pension costs are consuming ever-larger shares of government budgets and threatening public services throughout the nation.
In response, elected officials throughout the state are proposing reforms. On Monday, Los Angeles officials proposed modest changes to the retirement plans of newly hired police officers and firefighters.
Earlier this month, Gov. Arnold Schwarzenegger said pension reforms included in the state budget are expected to save up to $100 billion in the decades ahead.
Currently, Fujioka said the county spends more than $400 million annually on retiree's health care.
"It's a pay-as-you-go program," Fujioka said.
The county's unfunded pension liability is $5 billion now, partially a result of recent stock market losses. That's up from $2.3 billion in 2008.
But Rademacher said the county has a relatively conservative pension plan and underwent a series of reforms in the late 1970s and early 1980s - closing the more generous plans to new employees - that are helping to reduce the rising costs now.
"If we are ahead of the curve and have greater reforms than the state and city and have ($26 billion) in unfunded liabilities, you can imagine the billions and billions and billions of liabilities the state has," Antonovich said. "It's really like a stealth attack on the financial ability of every municipality and the state to be viable and to be able to create future jobs."
troy.anderson@dailynews.com, 213-974-8985
