San Jose pension crisis tied up in legal quagmire

By Daniel Borenstein | Contra Costa Times — Labor unions try to have it both ways. They fight statewide reform of public employee pension systems by insisting that change must be bargained at the local level. But, as we see in San Jose, when they get to the table they claim they can’t legally agree to substantive improvements.

Welcome to the crazy world of public employee pensions, where benefits are easy to increase, but nearly impossible to reduce — even when they’re unaffordable. The resulting costs squeeze out funds badly needed for police, fire protection, libraries and other essential city services — endangering the jobs of the workers whose unions resist change.

San Jose provides a stunning example:

  • Pensions have soared. Even after adjusting for inflation, the average annual benefit increased 75 percent for police and fire retirees from 1991-2009, and 54 percent for other workers.
  • Police and firefighters who retired in 2009-10 after at least 26 years of service collected an average starting pension of $119,000 a year. For other workers with similar service, the average was $63,500. The pensions come with a guaranteed 3 percent annual cost-of-living adjustment.  Continue reading . . .
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