Commentary: Pension plan backfires on California

This editorial appeared in The Sacramento Bee.

As tens of thousands of state workers brace for possible pay cuts and layoffs, a lucky few retired state workers can look forward to bonuses in their pension checks. Anyone wondering who is responsible need look no further than the Legislature and former Gov. Gray Davis.

In 2002, California legislators included 3,200 state employees in more than 90 classifications – among them milk testers, billboard inspectors, barbering examiners and deputy directors of the Department of Real Estate – in the universe of state employees who qualify for safety retirement benefits. Such benefits had previously been reserved for law enforcement officers and firefighters. The bill, approved by lawmakers and signed by Davis, raised the pensions for the newly designated safety employees by 25 percent.

By 2004, when the enhanced benefits went into effect, the state was struggling to pay its existing pension bill, which had spiked to $2.5 billion, an 18-fold increase in just four years. That year the state had to borrow close to $1 billion to pay retirement costs. Various committee analyses pegged the cost of the newest enhanced pension benefits at an unrealistically low $8.9 million a year.

This page wrote more than 40 editorials urging the Legislature to rescind the benefits before they went into effect. Milk testers and billboard inspectors, we argued, did not deserve pension benefits that were 25 percent richer than pensions most other state workers received. Their work, while important, did not involve the life-and-death risks or unusual physical demands that have been used to justify richer pensions for police and firefighters.

To read the complete editorial, visit The Sacramento Bee.