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The reform eliminates city subsidies to the employee portion of pension contributions for non-unionized workers. It’s expected to save $385,876 annually and is the first to save the city money by itself. (The two other completed reforms, agreeing to a competitive bid process for city services and gauging private interest in taking over the Miramar landfill, only could save money if the city takes further action than Prop. D requires.)
This pension reform could go further for the city’s elected officials, and a growing chorus is saying that it should.
The pension system envisions contributions from both the employer and the employee. A city law caps politician contributions to the pension system. Even with the council’s action this week, the cap will remain in place and elected officials still will pay less than half their costs to the pension system.
The U-T ran the numbers last week. To fund council members’ pensions, $29,700 must be paid into the retirement fund annually. Now, they contribute $2,400 toward that amount and taxpayers pay the rest. With the Prop. D reform, the amount would increase to $6,800. If the cap is eliminated, which the council can do, the council members would be paying nearly $15,000 each year.
Politicians own pension contributions rarely reached the radar until Prop. D came along over the summer. Since then, it’s become an example of the effectiveness of Councilman Carl DeMaio, the most outspoken Prop. D opponent, in hammering on an issue. He has been discussing the politician pension cap for months, and it has gained traction.
KUSI did a piece critical of the cap in August. The U-T editorial board this weekend said the cap should be eliminated.
So far, no council member in favor of Prop. D has come out in favor of eliminating the cap.