If local elected officials wrote to San Jose Mayor Chuck Reed encouraging him to move forward with plans to give cities and counties relief from the withering burden of retirement debt, most readers probably wouldn't be surprised.
After all, even with the economy rebounding and Wall Street soaring, retirement costs continue to chip away at municipal services while threatening the solvency of many public agencies.
Unfortunately, that's not what happened. Instead, as reported, four Sonoma County elected officials — Supervisor Mike McGuire, Santa Rosa Mayor Scott Bartley and Vice Mayor Erin Carlstrom and Healdsburg Vice Mayor Jim Wood — signed a Nov. 26 letter <i>opposing</i> Reed's plans for a statewide pension-relief ballot measure.
This raises the all-important question: What were they thinking?
There's no question that Sonoma County and the cities of Healdsburg and Santa Rosa would benefit significantly from the measure that Reed has in mind. Sonoma County's unfunded pension liability — the difference between what it has set aside and what it has promised to employees in retirement — totals $527 million. The county's contributions to the retirement fund have risen 400 percent since 2000. And in May, supervisors were told that, even though pensions funds were performing better and that the county had taken some steps to lower taxpayer pension costs, the county's overall payments are going to increase 25 percent more over the next three years.
This prompted Supervisor David Rabbit to note the obvious, "It's going to get worse before it gets better."
Santa Rosa has fared no better. At last count, the city was behind some $127.5 million in setting aside money to meet its long-term commitments. And the city's costs also are expected to continue climbing. This means more pressure to raise fees on recreational programs, cut park maintenance and make other service reductions.
Nonetheless, these elected officials signed a letter that opposed what could be the most promising way out of this mess, one driven largely by overly generous pension benefits approved in the past decade. "Like most Californians, we believe pension matters are best decided locally and addressed at the bargaining table rather than the ballot box," the letter said.
But that's precisely the problem. Cities and counties have no real ability to bring down these costs. Under California law, public employee unions hold most of the cards. As the law is now interpreted, to reduce retirement benefits, public agencies must give something back of equal value, which explains why local agencies have made limited headway in reducing pension liabilities in recent years.
The mayor of San Jose wants to get at the heart of the matter by asking voters, possibly in 2014, to approve a ballot measure that would allow cities, counties and school districts room to negotiate future benefit and, in times of financial distress, to change retirement accruals. This is not about taking away benefits that have been earned. It's about giving agencies the ability to make changes going forward.
All four of these officials — McGuire, Bartley, Wood and Carlstrom — will likely be running for public office next year, and they, no doubt, have earned the support of the powerful public employee unions for signing this letter. The burden on them will be showing how they have a better way out of this pension crisis. Undermining the one guy in the state who has managed to make progress on this issue doesn't sound like much of a plan — and doesn't instill much confidence in their ability to represent the interests of the general public.