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Gov. Jerry Brown in Los Angeles to announce pension bill coming from state Legislature

Gov. Jerry Brown will hold a news conference Tuesday in Los Angeles to announce a pension reform deal.
Gov. Jerry Brown will hold a news conference Tuesday in Los Angeles to announce a pension reform deal.
File photo by Andres Aguila/KPCC

Gov. Jerry Brown is coming to Los Angeles Tuesday and he is expected to discuss a pension reform bill that will be introduced in Sacramento.

Senate President pro Tem Darrell Steinberg (D-Sacramento) said the bill will be heard in committee Tuesday and brought to a vote Friday. Steinberg also promised the changes will be “robust." The governor had asked the Legislature to address the state's spiraling pension costs in this session, which ends Friday.

Steinberg said the overhaul will save the state “tens of billions of dollars” over the next few decades.

“I think that there are going to be some people, a lot of people, in organized labor, frankly, that are not going to be thrilled with it," Steinberg said. "It deals with every piece of the puzzle."

Those pieces include a cap on pensions, changes to formulas for determining pensions, increasing contributions for current employees, crackdowns on all well-publicized abuses such as pension spiking — which is when an employee works overtime in the final year of compensation to increase their pension payout.

It's not clear how far the Democrats' plan will go in creating significant savings. California's two main public employee pension funds have a combined $150 billion in unfunded liabilities, and most of the changes will affect newly hired workers. That means the state is not likely to see the benefits of those savings for decades.

Republicans are concerned the deal was negotiated with leaders of public employee unions who have a vested interest in preserving the status quo, rather than with the taxpayers' interests in mind. But labor leaders expressed outrage that the deal would trample on collective bargaining rights and worried that benefits would be insufficient.

"You can retire younger into poverty or work until you die. Those are your choices," said Terry Brennand, a lobbyist for the Service Employees International Union's state council.

Sen. Bob Huff (R-Diamond Bar) expressed skepticism about the plan while adding that he could not judge bills that have yet to be given to lawmakers.

While the minority party supported Brown's initial proposal, Republicans were left out of negotiations because their votes are not necessary to pass pension legislation.

"This is basically the union bosses negotiating with their stewards, the Democratic leaders," said Huff, the Senate's minority leader.