What is Gov. Jerry Brown proposing?
Among other revisions, Brown wants to:
•Change pensions for future public employees, blending guaranteed benefits with a new 401(k)-style savings plan;
•Raise the retirement age for most future public workers from 55 to 67 and require all public workers to contribute at least half of the cost of their retirement benefits;
•End employees’ ability to work for the government while drawing a public pension from a previous job;
•Provide full health benefits to only those retirees who were publicly employed for at least 25 years.
Why does he want these changes?
State and local pension costs have skyrocketed. Brown says the existing public retirement system is unaffordable and unsustainable in the long term.
Who would be affected?
All state and local public employees. Current workers would be expected to pay at least half of their retirement costs, but the higher retirement age and new savings plan would apply only to employees hired later.
How much money would the plan save?
According to the Brown administration, when fully phased in over the next 30 years, it could cut the state’s retirement fund obligations in half, saving $4 billion to $11 billion. Administration officials say an additional $4 billion to $11 billion would be saved at the city and county level.
What happens next?
Brown will submit his plan to the Legislature and ask that parts of it be placed on the November 2012 ballot for voters to consider. Moving those pieces to the ballot would require support from two-thirds of both the Assembly and state Senate.