SJ decides to send pension reform to voters

March 6, 2012 9:12:52 PM PST
In San Jose, a crucial decision is affecting the financial future of the city itself and thousands of city employees has been made. The San Jose City Council has decided whether to give voters the power to cut the pensions of public employees.

In an 8-3 vote, San Jose becomes the latest city to try to implement significant pension reform through the voters. It's an effort that's getting national attention.

Months of intense negations over pension reform came down to this: one last passionate public debate about putting the issue of pension reform before voters in June.

"We need significant reform., not just incremental reform," Santa Clara County Assessor Larry Stone said. "Why? Because the current system is not sustainable."

"It is wrong for your city, it's wrong for my city, it is just plain wrong," union leader LaVerne Washington said.

Pension costs have climbed in recent years and now account for $245 million, or about 20 percent, of the general fund.

The unions have accused the mayor of exaggerating just how high those pensions costs could climb, but he says a ballot measure is the only way to bring skyrocketing expenditures under control and is asking voters to accomplish what he said did not happened in 20 mediation sessions.

"It's time for the voters to decide; it the voters who need to decide whether we're going to spend their tax dollars for additional retirement benefits or if we're going to reduce those costs and be able to spend it on services," Mayor Chuck Reed said. "I think that's the right of the voters."

Ten years of budget deficits in San Jose have resulted in layoffs and cuts to city services. The unions say their proposals for real changes to retirement benefits have been ignored and the only thing voter approved pension reform guarantees is a long court battle.

"They're just going to flat out and violate the law," firefighters union president Robert Sapien said. "That's going to be their approach; they're going to break the law and see what they can get out of it in court. What we know they're going to get is a lot of legal bills."

The majority of council members acknowledged there are legal risks with putting the measure on the ballot but say the bigger risk is doing nothing.

"Not everybody is going to be happy right now, I think as we cross over this and move forward, we're going to look back and see this was the turning point," City Councilmember Rose Herrera said.

The ballot language was modified seven times in an effort to address some of those union concerns. The mayor is confident it will withstand legal challenges, but first comes the vote itself in June.


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