Brown Plan to Eliminate Retiree Health Care Debt
Gov. Brown wants state workers to begin paying half the cost of their future retiree health care — a big change for workers making no payments for coverage that can pay 100 percent of the premium for a retiree and 90 percent for their dependents. The governor also wants state workers to be given the […]
Vallejo First to Test No Pension Cut in Bankruptcy
What happens when a bankrupt city does not cut its largest debt, pensions, is getting its first test in Vallejo, which has higher average pensions and higher CalPERS rates than the two larger cities still in bankruptcy, Stockton and San Bernardino. Vallejo was the forerunner, choosing not to try to cut pensions before exiting a […]
San Jose Pension Reform: New Players, New Ruling
In what looked like a referendum on a voter-approved pension reform, a supporter, Councilman Sam Liccardo, was narrowly elected mayor of San Jose. He defeated a union-backed reform opponent, Supervisor Dave Cortese, who conceded last week. Local, state and national public employee unions reportedly spent more than $800,000 to defeat Liccardo with a campaign warning […]
Bankruptcy Judge Explains Pension Cut Hurdles
A federal judge, who earlier ruled CalPERS pension contracts can be overturned in bankruptcy, yesterday outlined the difficulty of cutting pensions while approving Stockton’s plan to exit bankruptcy with pensions intact. U.S. Bankruptcy Judge Christopher Klein issued a ruling on Oct.1 that CalPERS pensions, despite attempted safeguards in state law, can be cut in a […]
Bankruptcy Judge: CalPERS Pensions Can Be Cut
A federal judge ruled yesterday that CalPERS pensions can be cut in bankruptcy like other debt. He rejected the argument that the giant system is an “arm of the state” with pensions protected by federal law and two state laws on contracts and liens. U.S. Bankruptcy Judge Christopher Klein, who has called the issue of […]
Detroit-Style Pension Cuts: Could It Happen Here?
Bankrupt Detroit announced last week that current workers and retirees voted overwhelmingly to cut many pensions by 4.5 percent and to trim or eliminate cost-of-living adjustments. If the plan to exit bankruptcy had been rejected, a federal judge might have imposed a proposed 27 percent pension cut, and a $816 million contribution to offset pension […]
New Step to Expose Hidden Retiree Health Debt
A decade ago new accounting rules directed state and local governments to begin calculating and reporting debt owed for health care promised retirees, which for state workers turned out to be more than the debt owed for pensions. In a new step to expose hidden debt, the Governmental Accounting Standards Board last week proposed that […]
Public Pensions Become Issue in Labor Strikes
As retirement costs grow, traditional labor disputes over wages and health coverage have a newcomer. Pensions are one of the issues in recent strikes by UC hospital workers and San Francisco Bay Area transit workers. The dispute is not over the amount of pensions promised current workers, widely believed to be protected by court rulings. […]
Can San Jose Cut Pensions of Current Workers?
After a five-day trial last month, a judge is looking at 13 issues in suits filed by unions and retirees against a San Jose pension reform. The big one is whether pensions earned by current workers can be cut. Measure B, approved by 70 percent of San Jose voters last year, challenges the widely held […]
Will Detroit’s Bankruptcy Lead to Stockton Deal?
Bond insurers who walked away from mediation last year before Stockton filed for bankruptcy are at the table this summer. A deal could avoid a precedent-setting legal showdown on whether public pensions can be cut in bankruptcy. Attorneys for the city and bond insurers told U.S. Bankruptcy Judge Christopher Klein last week that mediation, presided […]