Desire for ‘COLA’ Benefit Fueled Strike

When hundreds of county employees last week angrily chanted, “We want COLA!” they were demanding a pension benefit that has been a fixture in other counties for decades.

A COLA--a “cost-of-living adjustment,” in the parlance of pension planners--ensures that retirees’ monthly pension checks are boosted a bit each year to keep pace with inflation. The lack of a COLA for most rank-and-file Ventura County employees ignited the unprecedented strike that began this week.

Elsewhere, however, what was once a coveted perk has become a customary benefit for public workers. With goods that cost $1,000 in 1981 running consumers more than $1,900 today, such inflation adjusters are standard fare for government retirees in California.

“Employees want it,” said Steve Szalay, executive director of the California State Assn. of Counties. “It’s hard to blame them.”

Szalay said people who retire from all but a few of the state’s counties see their pension checks increased annually by a COLA.

In Ventura County, employees enjoyed a COLA until 1979, when it was eliminated for new hires. In a negotiated agreement, rank-and-file employees gave up the increase in return for a number of concessions from the county.

Barry Hammitt, chief of the Service Employees International Union local representing most county employees, said the county agreed to absorb a 2.1% increase in the amount workers contributed to their retirement. Hal Pittman, the county’s treasurer and a member of its retirement board, said the action was linked to a salary increase and other benefits.

“It’s unfortunate that the COLA was ever taken away,” Pittman said. “Is it something they need and should have had a long time ago? Absolutely. But can we afford it as a county? That’s the big question.”

At issue is not only whether the COLA should be reinstituted, but also whether it should be made retroactive to 1979, a benefit that could cost at least $70 million, according to Pittman.

Depending on the contracts between county governments and their employees, the amount provided by a COLA varies, but often the adjustment is tied to the consumer price index--a gauge used to adjust everything from Social Security benefits to the price of school lunches.

About 20 of California’s 58 counties, including Ventura, run their own pension operations. The rest contract with the California Public Employees Retirement System, a Sacramento-based agency that handles pensions for schools, state workers, municipalities--all in all, about 2,400 public agencies.

Brad Pacheco, a CalPERS spokesman, said state and school retirees receive an annual 2% boost from their cost-of-living increases, though the increases can’t exceed the national inflation rate. Employees of counties and other agencies receive from 2% to 5%.

COLAs are so firmly established in the public sector that pension experts could not recall any recent disputes over whether one should be started.

“There’s been no conflict that I’m aware of in Orange County,” said James Buck, chief operating officer of the Orange County Employee Retirement System.

Buck said COLAs have been provided to Orange County retirees for at least 30 years. Even after the county was forced to file for bankruptcy in 1994, there was no discussion of terminating the benefit, Buck said, adding that the county’s retirement funds were unaffected by the bad investments that triggered its fiscal downfall.

In Los Angeles County, employees are offered several pension plans. About half choose not to contribute toward their retirement and have not been eligible for the annual pension adjustments. As a result of recent negotiations, they eventually will be eligible, said Pat Swancutt, an executive in the Los Angeles County chief administrator’s office.

The other half funnel an average of about 7% of their salaries toward their retirement, depending on their age at the time they were hired. When they retire, they will receive cost-of-living adjustments of up to 2% each year.

In Santa Barbara County, retirees take advantage of an annual COLA ranging from 1% to 3%, according to Personnel Director Ann Goodrich. As in many other counties, management and rank and file receive the same adjustment rate--a point of contention in Ventura County, where retired sheriff’s deputies and management-level employees outside law enforcement receive a COLA but most others do not.

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Times staff writer Tina Dirmann contributed to this story.