SACRAMENTO, Calif. — Gov. Gavin Newsom vetoed a bill that would have lowered retirement ages and increased pension benefits for police officers and firefighters, Cal Matters reported.
Newsom vetoed Assembly Bill 1383 on Sept. 20, in spite of strong legislative support. He cited concerns of a potential pension crisis as the reason for his rejection.
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AB 1383 would have lowered the retirement age from 57 to 55 and allowed unions to bargain for bigger pensions by increasing the maximum accrual rate to 3% from 2.7%, Cal Matters reported.
The bill would have also increased the maximum retirement income cap for high-earning public servants.
Supporters of AB 1383 cited support for first responders when passing it through congress. The bill passed unanimously in the Senate and 70-2 in the House.
In his veto, Newsom stated that parts of AB 1383 would contradict the Public Employees Pension Reform Act, a 2013 statute intended to reverse damage that the Great Recession and dot-com bust caused to the state’s pension system. Officials feared at the time that pension accounts would become insolvent, Cal Matters reported.
The losses from the recession still affect the system, with accounts funded at about 85% of what they owe to their members.
“I still recall — before PEPRA’s passage in 2012 — the alarming forecasts, the fierce criticism of public employees, and the growing pressure to eliminate defined benefit plans all together,” Newsom wrote. “This is an era of California history I do not wish to repeat.”
Cities and counties also opposed the bill, due to the increased costs of funding the pension system faster, Cal Matters reported.
Would stronger pension benefits help agencies recruit and retain officers? Why or why not?
Police1 readers respond:
- Full disclosure, I benefitted from the original/ classic 3@50. But my retirement at age 51 was compounded by the offset I was giving each month to a 37 act pension which was almost 3 thousand dollars. It was too young to retire, and I wound up going to a PERS agency where I am getting another, albeit small, benefit each month. The year I retired, 2011, the amount of retirees was normalized, versus the exodus in 2003 when the classic benefit was implemented and those who left, hadn’t paid into the spike and the result was catastrophic for our retirement system. And to make matters worse, there was a catch-up provision for those in the old system that got paid for the implementation of the 3@50. If we had stayed with the old system and just tweaked it to 2.7@55 instead of 57, the savings would have been significant and the cost to the employee would have normalized the contract negotiations. I am handsomely paid and have a good standard of living, but I have seen and know the numbers paid out to some each month in excess of 25K a month. Not Newsom fan, but he was right in vetoing the bill and not re-visiting the problems of pension spiking again.
- California never disappoints!
- I retired from one police department at age 65. Ten years later, I hired on at another police department and finally quit policing at age 82. All my policing was done on the streets. A good friend asked me why I stayed on the streets all that time. I quoted a scene from the movie “The Green Beret” where a soldier was not picked for an assignment to Vietnam. His commander asked him why he volunteered in the first place and he said, “I’m a soldier and that’s where the action is. I guess I could say I was a police officer and that’s where the action is.
- No it wouldn’t. We need officers who are in it to protect the community that they serve, NOT for what they benefit from. Many join just for the benefits that’s why so many are terrible at the job.
Yes, right now LEOs fight the streets, gangs, homegrown terror & quite frequently city hall. They must have an incentive beyond weekly paychecks to have them look into the future and argue that their jobs today are preparing them for retirement
