The California government today passed a pension reform bill that the government is calling the “biggest rollback to public pension benefits in the history of California pensions.”
The new legislation will raise the minimum retirement age for the state’s public service and will reduce pension benefits for new public workers—moves that California Governor Jerry Brown said will save billions of dollars.
New hires will also split payments made to the pension at least 50-50 with their employers, while government employers will have greater authority to negotiate similar 50-50 contribution arrangements with current employees.
Public-sector pensions has been a hot-button issue across the U.S. Voters in San Diego and San Jose, California’s second- and third-largest cities after Los Angeles, sent a signal to state leaders in June by overwhelmingly approving municipal plans to alter pensions for city workers in order to rein in public retirement costs.