Sonoma County supervisors are expected to soon form another advisory group of citizens to help examine additional ways to bring down the county’s rising employee pension costs, breathing new life into what has long been a thorny issue for local elected officials, labor leaders and taxpayer advocates.
The county’s main goal is to slash taxpayer pension costs, estimated this year at more than $107 million — up 86 percent from a decade ago, a sharp rise that continues to be fueled by enhanced retirement benefits granted to workers in local and state government in the early 2000s.
State and local reforms rolled out over the past six years have saved taxpayers $178 million, according to the county, and are expected to reduce annual costs over the long term.
But that won’t be enough for the county to hit a key savings target in 2024, when supervisors hoped to have pension costs in check, at or below 10 percent of total annual spending on salary and benefits. Currently, those costs account for nearly 18 percent of payroll spending, diminishing dollars available for public services.
And the county’s latest projections show it will not hit its savings target until 2031, two years after pension costs are expected to peak at $136 million.
In revisiting the issue this week, the Board of Supervisors sounded a message similar to an acknowledgment made late last year by Gov. Jerry Brown — that more needs to be done on the hot-button issue to steward public dollars. Unfunded liabilities for the county’s independent pension system total $750 million, including county obligations to the retirement fund and taxpayer debt from past pension bonds.
It’s reason enough to form another advisory committee, supervisors agreed.
“It’s really about oversight and about giving people confidence that we have someone watching what we’re doing and recommending anything that can be done to lower the overall cost — and to really, truly understand the world that we live in, in terms of pensions in California,” said Supervisor David Rabbitt, a longtime board member on the county’s pension system and key player in local efforts to reduce costs.
The Board of Supervisors considered a proposal Tuesday to create a new temporary citizens’ panel, similar to one that made recommendations last year. The panel’s work would include reviewing the county’s pension reform strategies over a 20-month period. The board delayed action after Rabbitt suggested instead making the panel permanent, which he said would provide a more consistent and transparent examination of the county’s reform efforts.
The first citizens’ advisory committee, in its report to supervisors last summer, concluded the county had made insufficient progress on pension reform and recommended officials take more aggressive action moving forward. Many of the most significant steps advocated by the panel — including equal sharing of investment risk now born predominantly by taxpayers and a new tier of less generous retirement benefits — would take buy-in from county employees or changes in state law.
Rabbitt, who at the time voiced some frustration with that final report, and Supervisor Shirlee Zane, who has also been a key player in county reforms, reformed their two-member board committee in November to continue studying the issue.
Following Rabbitt’s suggestion Tuesday, he and Zane will further flesh out what an ongoing citizens’ advisory committee might look like and discuss another proposal with the full board at a later date.
Sonoma County government pensions
Total current value of pension fund: $2.5 billion
Unfunded obligations to retirees: $371 million
Current pension bond debt: $380 million
Taxpayer annual pension costs in 2000: $18.5 million
Current annual pension costs: $107.6 million
Projected peak in pension costs, 2029: $136.4 million