Government Unions Stall San Diego Pension Reform

Collective bargaining privileges are facilitating the San Diego Municipal Employee Association’s (MEA) ability to wreak havoc over voter-approved pension reform. These privileges elevate union special interest over the public’s interest in maintaining fiscal solvency.

In June 5 elections, San Diego voters overwhelmingly supported ballot measure Proposition B, which reforms city employees unsustainable pensions needed to avoid bankruptcy. The initiative gained ballot access after 116,000 signatures were collected. It then passed with 66 percent approval.

The pension reform requires new city employees (except police) to switch to 401(k) plans, instead of a defined-benefit plan, in order to limit the city’s contributions and liability to pensions. Plus, government workers will gain certainty over their retirements, an improvement over a pension fund that depends on government policy. In addition, the measure puts a five-year freeze on pension payout amounts to workers. The city’s independent budget analyst estimated savings to be $950 million over 30 years.