AirTalk for April 20, 2012

Mayor expected to slice retirement benefits for city workers

"No Labels" Political Organization Launches As Counterpoint To Tea Party

Spencer Platt/Getty Images

Los Angeles Mayor Antonio Villaraigosa speaks at the launch of the unaffiliated political organization known as No Labels December 13, 2010 at Columbia University in New York City.

Parts of Mayor Antonio Villaraigosa’s proposed budget, which will be announced during a press conference this afternoon, have been obtained in advance by the Los Angeles Times. The main issues revealed in these partial budget documents center on retirement age and pension benefits, both topics of contention between Villaraigosa and city employee unions.

To combat a $238-million shortfall in the budget, the mayor plans to increase the retirement age to 67 from 60, citing increased mortality rates. Concerning pensions, the mayor is limiting them to no more than 75% of an employee’s salary.

Those on the side of employee unions are put off by both proposals, citing that while people are living and working longer, many city jobs take a tremendous mental and physical toll. On the issue of reduced pensions, they find the savings marginal, since not many employees receive a pension equal to their salary. They’d have to work for 46 years for that to be the case.

Other aspects of Villaraigosa’s plan include a different formula for calculating retirement benefits, which would reduce them from 2.16% of one’s salary to 2%, and preventing “pension spiking,” which entails boosting one’s salary the final year before retirement. It should be noted that this does not concern employees at the Department of Water and Power, as they have their own pension system.

How much would these changes really affect the budget? Do the benefits to the city outweigh the costs to individual employees? Will workers be able to survive in retirement, and what will that retirement look like? Furthermore, what about the layoffs which are rumored to be included in the budget as well?

Guest:

Victor Gordo, Representing the Coalition of L.A. City Unions, collectively representing 22,000 workers including maintenance workers, traffic officers, librarians, wastewater treatment operators, 911 operators and more; Attorney and Secretary-Treasurer for Laborers' International Union of North America, Local 777; Councilman in the City of Pasadena

Frank Stoltze, KPCC Reporter


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