FOSTER THREATENS CITY UNIONS WITH BALLOT INITIATIVE TO CURB PENSIONS

In his fifth State of the City message, Mayor Bob Foster said Tuesday night that Long Beach has “weathered a great storm,” faces additional challenges in Governor Brown’s proposed governmental “realignment” and Redevelopment changes, and threatened the city’s three largest public employee unions—police, fire, non-public safety/machinists—with a ballot initiative that would constrain pension benefits.

Addressing a capacity crowd (825 seats, approaching 900 with standing room) in the Center Theater at the Long Beach Performing Arts Center—a speech linked live on LBReport.com—Foster demanded that those unions make the pension changes in collective bargaining that he unsuccessfully asked them to make last year.

Foster also raised the specter of contracting out city services. “If we do not reform our pension system the costs will outstrip our capability to provide essential services,” he said. “Police, fire and all quality of life service will be reduced. Contracting with other agencies, such as the county, may be necessary to provide basic services.”

Foster described his 2010 proposals to the unions as “a thoughtful, relatively painless way to help solve our city’s pension problem.” He outlined a scenario in which “contracted raises [would] be applied to the employee share of pension costs” with the employee’s contribution increasing “until their full and fair share was reached. Employees would not see the raise in their check, but their pay would not decline and we could gradually get to a point where they were paying their fair share.” In addition, new employees would have new pensions rules (for public safety, retirement at 55 instead of 50, changed formula from 3 percent per year of service to 2 percent; for all others retirement at 60 instead of 55, formula from 2.5 percent to 2.0 percent.”

The three unions rejected these proposals.

Foster acknowledged his proposed changes would have still left the City with a cumulative deficit of $28 million in fiscal years 2012-14, but said this was half of what the deficit would be without the changes. “At these reduced levels [with the changes], we could still provide for our essential services, including public safety,” he said.

Foster maintained that he had proposed the changes “in the spirit of shared sacrifice and with hope that our employee groups would look beyond their immediate self-interest to a larger more sustainable and stable future.” However, he continued, “I was to be disappointed…[T]he three largest [LB city employee] groups—police, fire, and the machinists—took raises and rejected the reforms.”

Mayor Foster then said pointedly:

“I know it’s difficult to explain to any organization that sacrifice needs to be made and no one wants to be first. But the future of public pensions is so clear—they cannot be sustained. Claims were made and will be again that we are putting life and property at risk calling for reductions in all areas. Not so, it is the unreasonable rejection of reform and an ingrained entitlement mentality that puts our City at risk.”

He added, “We cannot allow government to grow to pay for unreasonable and unsustainable pensions. At this time in the economic recovery, we should not encumber businesses or individuals with a greater tax burden.”

Foster said that if he “is unsuccessful in bargaining for these changes I will propose a ballot initiative that will constrain future Mayors and Councils from providing any more in pension benefits than those outlined above. These restrictions, if passed, will go into effect when the current contracts with our unions end.”