"The Sonoma Taxpayers and (San Jose Mayor Chuck) Reed are a good match because they both use right-wing ideology to spread lies about working people ... "
— Lisa Maldonado, executive director of North Bay Labor Council ("San Jose mayor pitches pension changes," Friday)
It's hard to know for which group of working people Maldonado is speaking. Is it for those former county and city employees who had the misfortune of retiring before the era of enhanced benefits and now find themselves not only receiving pensions that pale in comparison to those of their successors but ensnared in a public debate that, if calmer minds don't prevail, could result in their modest pensions being cut, as may happen in Detroit?
Or does she speak for those "second-tier" and "third-tier" employees now being hired who find themselves in line to receive retirement packages that are far diminished from those who came before them and do similar work?
We don't know. But our guess is she's not even speaking for most first-tier employees who had the fortune of being hired before 2013 but did not retire before that pivotal 2001-03 time period and therefore, in most cases, stand to receive benefit packages that — through no fault of their own and despite recent reforms and adjustments through collective bargaining — still threaten the long-term financial stability of Sonoma County government.
Nobody benefits if retirement costs and liabilities continue to grow. And trusting that the stock market will somehow resolve it all is how we got into this fix in the first place.
This is what San Jose Mayor Chuck Reed came to Sonoma County to discuss last week. And, despite those who contend otherwise, he wasn't spreading lies. The only thing to fear is ignoring what he has to say.
The fact is, despite a rebounding economy, a surging stock market and robust debate about public employee retirements, the gains in recent years on the pension issue have been modest. And the problem is not fixed.
Reed says cities and counties still have work to do to stem rising retirement costs or they could cripple the ability of public agencies to provide basic services. That is especially true in Sonoma County, which has seen its contributions for salary and benefits jump more than 400 percent over the past decade to $98.3 million a year, and further climbs are expected. Meanwhile, the county is still behind some $527 million in meeting its long-term retirement obligations.
San Jose had a similar problem, which motivated 70 percent of voters there to approve a ballot measure in 2012 cutting retirement benefits for city workers. But a lower-court judge recently overturned most of the changes, citing the "California Rule," which prevents public agencies from unilaterally altering retirement packages even in the face of insolvency.
It's the same obstacle that prevented cities such as Vallejo and Stockton from finding relief from robust pension packages even in bankruptcy.
Reed is seeking to break this logjam of irrational thought and precedent with a public pension reform initiative that he hoped to put before voters this year. But it appears that may be delayed until 2016 due to a lawsuit he now has pending against state Attorney General Kamala Harris for producing an "inaccurate and misleading" ballot summary.