Governor Jerry Brown heard a clarion call for his party to take on employee pensions in the overwhelming passage last week of retirement reforms by the second and third biggest cities in the state, San Diego and San Jose.
Yet the message did not resonate as strongly in the statehouse where fellow Democrats rule.
The pensions issue is set to trigger a fundamental struggle within the Democratic Party over what needs to be done and how fast. The result may be that voters have to force any changes they want through the state’s initiative process.
San Jose voted Tuesday to force employees, including police and firefighters, to pay sharply more for retirement or see a sharp drop in benefits. Meanwhile, San Diego passed a measure to put new employees on a 401(k)-style plan in which the city guarantees how much it will contribute to retirement plans, not how much retirees will get.
Brown took the vote as a sign the state was ready to jump on his 12-point plan to narrow a pension shortfall estimated to be as high as half a trillion dollars. He would put new state employees on a plan that forces them to shoulder some financial market risk, raise the retirement age — to 67 from as little as 55 for many employees — and raise the financial experience of state retirement boards, among other things.
At least part of Brown’s plan would need a statewide vote, however, and the governor has only three weeks to convince the legislature to put a measure on the November ballot.