San Jose Mayor Sam Liccardo has confirmed to Capital & Main that his city is nearing a settlement with its nine non-safety unions over a contentious pension-cutting law that resulted in an exodus of public employees, followed by costly legal actions. Measure B, passed in 2012, sought to reduce pensions for new hires, eliminate extra “bonus” checks to retirees and make it harder to qualify for disability retirement. It also called for veteran workers to either pay much more for their pensions or switch to a pension with reduced benefits.
The two sides appear to be moving closer to a settlement similar to one reached four months ago with police and fire unions.
How close? “Soon,” Liccardo said by telephone. “We don’t [quite] have all the signatures yet.”
The story of Measure B and the damage it left in its wake is of more than academic interest,
Since leaving office in 2001, the former mayor has not exactly distinguished himself as an elder statesman of L.A. politics. But at age 82, Riordan seems determined to leave a permanent imprint on the city he once governed by gutting the pensions of some 30,000 city employees.
Riordan is promoting and helping to bankroll a ballot petition that, if it qualifies and passes, would replace the modest but secure retirement plans of future city workers with their poor cousin, the 401(k). Current city employees would theoretically retain their retirement benefits, but these too would almost certainly get the axe because the ballot petition empowers the City Council to eviscerate pensions.
If all this sounds extreme, it is —
Former L.A. Mayor Richard Riordan has been in the news lately, arguing that city leaders need to take drastic steps to make Los Angeles more business friendly and get the city functioning again. He has blamed public sector unions for every woe facing the region, including the current financial crisis and potholes on his street in Brentwood.
Mayor Riordan is not just crying in the wilderness. His threat to put a draconian pension-cutting initiative on the ballot played a major part in prompting the City Council last month to hastily adopt its own pension-cutting plan – a plan that almost certainly will be thrown out by the courts as a violation of existing collective bargaining agreements.
Riordan’s resurrection as a major political force begs a fundamental question: How successful was he at bringing business and jobs to L.A. and overseeing scarce public resources when he was running the city?
“Kick the can down the road” may be a politician’s mantra, but it’s certainly not what some Native Americans meant when they spoke of the Seventh Generation. The Iroquois thought that decision-making ought to consider the impact on children yet to come. Politicians, on the other hand, pick the least painful path now and let someone else deal with the consequences 30 years from now.
The Los Angeles City Council just kicked the can. Its members, at the urging of the Mayor, voted almost unanimously to change the pension program for new civilian city employees. This policy change only applies to new hires and exempts police, firefighters and the employees of the Department of Water and Power. The plan reduces new workers’ pensions by two-thirds, eliminates health-care support for their spouses and decreases take-home pay during years when the stock market isn’t performing well enough to sustain retirement investments.