State Legislature Needs to Back Brown’s Pension Plan
Just like the tax code, the public pension system is broken and needs to be fixed. Governor Brown’s latest attempt to reform the pension debacle California is in and, although it’s far from perfect, the state needs to move forward and the Legislature’s approval will put it on the ballot. The state owes billions in unfunded pension benefits and something must be done now.
Brown’s plan addresses the major problems and provides solutions so eventually the state may actually see daylight and some relief from this huge debt. Some of the changes include: all new and current employees to contribute at least 50 percent of retirement costs; formation of a hybrid 401(k) plan for new employees; raising the retirement age eligibility from 55 to 67; eliminating pension spiking where benefits are calculated on your average compensation for the past three years as opposed to the current one-year system and bars employees from buying credits to boost retirement service credit for time not actually worked. There are several more changes in the governor’s plan, but the key issue is that he is taking a bold stand on this which has been ignored far too long. The unions are already ramping up resistance, but this is where the Legislature and the governor need to come together on a plan and stand strong.
The current pension benefits programs are not only bankrupting the state, but local governments as well. We simply cannot continue on the road we’re traveling. Putting a pension reform plan in place as soon as possible will provide a much brighter future for generations to come in California.
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