The Ventura County public employee pension system, driven by public safety unions, is gobbling up an unjust amount of government resources, saddling Ventura County taxpayers with an unreasonable burden. The time for change is overdue.
The magnitude of the problem facing taxpayers was illustrated during a recent presentation to the Board of Supervisors by the CEO’s office. It was apparent from the presentation that the County is facing rising deficits because of uncontrolled pension costs.
Over the last five years, pension costs increased 76 percent and are projected to increase another 50 percent to $226 million a year in the next five years.
And that was the good news. Supervisors were told pension costs could rise even more if investments made by the pension fund fail to grow at least 7.75 percent every year. Any short-fall from that lofty expected return is generally made-up by taxpayers and not County workers.
The unspoken subtext at the Board of Supervisors meeting was, taxpayers are going to have to pay more and receive reduced services just so a small minority of County workers specifically those in public safety, can retire at a young age with gold plated pensions.
In other words, expect more of the same behavior that we have seen over the years as our Supervisors watched pension costs explode from $86 million to over $226 million a year, waiting for Sacramento or anyone else to fix problems they were elected to solve.
Forget about all the pension reform happy talk coming out of Sacramento. The law signed by Gov. Brown should instead be called the 1 percent solution – because that is how much the County expects to save in the next few years as a result of the reforms.
Ventura County Taxpayers Association believes the County must take strong action now or the deficit-ridden pension system will require diversion of public funds from necessary and treasured programs to cover pension cost increases. Every dollar diverted from the general fund into pension funds has the potential to reduce public services (like road maintenance, infrastructure, emergency preparedness and response and adequate public safety staffing levels) to the public.
Since VCTA did not hear anything at the BOS meeting to suggest the County or the Supervisors had a plan to address rising pension costs we respectively offer one. It starts at the negotiating table and it concerns public safety employees.
Of 10 bargaining unions at the County, Sheriff and Fire are paid the highest average salaries and receive the biggest pensions at retirement. Unlike other bargaining unions with lesser pensions, public safety pays close to nothing for their benefits.
Members of SEIU Local 721 pay 4.73 percent of the required 5.73 percent employee share of pension costs (taxpayers pay the difference) plus they pay 4.2 percent to Social Security.
In exchange for contributing a total of 8.93 percent of their pay while working, SEIU members can expect an average Tier II pension of about $23,000 a year with no COLA or retiree health benefits, but supplemented by Social Security.
County Sheriff and Fire on the other hand, pay only 2.5 percent of the required 12.71 percent employee share of pension costs (taxpayers again pay the difference). Public safety is not part of the Social Security system.
In exchange for contributing just 2.5 percent of their pay while working, public safety members can expect an average Tier I pension of about $114,000 a year plus annual COLA increases and retiree medical benefits, but no Social Security.
Why have the Supervisors largely exempted public safety workers from paying their fair share of pension costs, passing those costs instead onto taxpayers?
The County is deep in negotiations with Sheriff and Fire unions on new labor agreements. If the Board of Supervisors as part of those negotiations required that all public safety workers pay the full 12.71 percent required employee contribution rather than the 2.5 percent they currently pay, taxpayers and the County would by our calculations save $16 million year.
Both safety unions have options to extend their existing contracts well into next year. We hope they will not exercise the option and instead will step up and begin paying their fair share of pension costs like other County employees do.
With County government facing deficits and rising pension costs as far as the eye can see, it is time for public safety unions to step-up and be part of the solution and for the Supervisors to establish the expectation that they do so.