Yesterday, the U-T got its hands on a long-awaited study on a city of San Diego controversial pension benefit.
The article confirms what union officials had told us a few weeks ago. The Deferred Retirement Option Plan, or DROP, costs the city money but was within the margin of error for being considered a net zero to the city’s bottom line. The city’s municipal code says DROP “is intended to be cost neutral.”
DROP’s cost was pegged at $149 million. But before you light all of your hair on fire, know that before the study began both city and union officials agreed on a 2 percent margin of error. It’s the same standard used in a similar study in Los Angeles.
For years, pension hawks have lambasted the program as the epitome of excess in the pension system. It’s harder to make that claim now, especially since the city eliminated the plan for new hires in 2005.
Still, $149 million is a big number. The U-T said Mayor Jerry Sanders would ask City Council for further analysis to reduce costs.