Pension Reform

By Al Adam

Here in Thousand Oaks public employees can retire as early as 55 years old. The City contributes 14% of an employee's salary to the California Public Employees Retirement System or CalPERS. The City picks up the entire contribution and the employee pays nothing. Pension funding for 2012-2013 will run the City close to $7 million and will soon increase to 15% of salary. Employee benefits are guaranteed no matter what the investment results turn out to be.

Local governments have seen their pension burdens increase to the point that cutting back on police and fire services has become necessary. In the worst- case scenario, cities like Stockton and San Bernardino have been forced to file for bankruptcy citing pension liabilities as a chief factor.

I will be proactive and prevent this from happening in Thousand Oaks. I will push to increase the retirement age to match Social Security. Delaying retirement just five years would cut pension costs in half. Public employees should fund 100% of their retirement plans just as those in the private sector do. Taxpayers should not assume all the risk by guaranteeing benefits in these plans. I want to see a 401K type plan used in which the employee bears the risk of return. The days of guaranteed pension benefits are no longer affordable. After all, CalPERS earned just 1% on its investments last year. This is well below the projected return of 7.5% and now the taxpayer will have to contribute more money to make up the difference.

Now is time for the benefits of the public sector to align with those of the private sector. Pensions promised to public employees when times were good are unsustainable and unfair to taxpayers who have seen their pensions disappear in the private economy.

For More Information, visit my website at: http://www.AlAdamForCouncil.com