By Brant Ozanich
A report recommending California to overhaul its public pension system released by an independent state oversight agency on Feb. 24 could propel the state into a series of labor and union struggles similar to those happening in Wisconsin.
The agency, informally called the Little Hoover Commission, prepared the report in response to Governor Jerry Brown’s request of recommendations on how to save money and make the state government more efficient.
“California’s pension plans are dangerously underfunded, the result of overly generous benefit promises, wishful thinking and an unwillingness to plan prudently,” the introduction to the report noted.
“Unless aggressive reforms are implemented now, the problem will get far worse, forcing counties and cities to severely reduce services and layoff employees to meet pension obligations.”
The report primarily focuses on California Public Employees’ Retirement System (CalPERS), which provides pension benefits for more than 1.6 million Californians and their families and is the biggest public pension plan in the United States. The report still made a point to mention other pension plans.
An overwhelming majority of City College’s staff is covered by either the California State Teachers’ Retirement System (CalSTRS), a pension system for teachers and administration of public schools and community colleges, or San Francisco Employees Retirement System (SFERS), San Francisco’s own public pension system, said Leslie Smith, City College’s Government Liaison.
“The faculty and administrators do not pay into Social Security, because we have our own system, which is CalSTRS” Smith Said. “A major part of our classified staff are in the SFERS”
The report claimed California’s public pension system lacked discipline and accountability, the math didn’t work, and that pension costs would crush the government.
It also recommended that state and local governments move to a hybrid pension model that includes aspects of 401(k)-style plans used in private sector and increase transparency and accountability by providing more information to the public.
Public pensions and unions are seeing increased scrutiny as a debate over collective bargaining in Wisconsin has led to numerous protests and increased media attention to the issue.
“I think that public service is fundamental to the success of our government. You want good public servants, to get good public servants you need to treat them well,” Smith said. “The attack on pensions is dead wrong. All people who work should know that when they are too old to work that they have a safe place to live and health benefits to take care of them.”
The commission, formally called the “Milton Marks ‘Little Hoover’ Commission on California State Government Organization and Economy,” is an independent state monitoring organization founded upon legislation authored by former State Assemblyman Milton Marks Jr., father of current City College Board of Trustee Milton Marks III.