San Jose Offers Model For Pension Reform

The independent commission tasked with making state government more efficient has sought San Jose Mayor Chuck Reed’s views on how to control skyrocketing public pension costs.

Reed said his testimony before the Little Hoover Commission in Sacramento on Thursday would describe San Jose’s efforts to offer newly hired public employees less costly pension plans.

“Our pension costs have nearly tripled in the last decade. They’re driving costs out through the roof, making it necessary to cut other services,” Reed said.

KCBS Mike Colgan Reporting:

The city employed 7,400 full-time employees in 2001 where now just 5,800 are on the payroll. Several of San Jose’s public employee unions took wage concessions of as much as 10 percent this year to help balance the city’s budget.

Reed blamed the staffing cuts on a pension system that allows 50-year-old retirees to collect 90 percent of their salary, with an annual three percent cost of living increase each year.

“They’ll make more money in retirement than when they were on active duty. That’s too much,” he said.

Changing San Jose’s public employee pension system requires a charter amendment that goes before voters in November.

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More from Mike Colgan
  • Mike

    aside from city management, the only people eligible to retire at age 50 are police officers and firefighters. Given the average police officer dies within 5 years of retiring I don’t see how the system is so outlandish. Tax payer dollars are wasted on far too many other things rather than attacking hard earned pension plans.

  • WhatHappened

    Where does mike get his numbers from the union

  • WhatHappened

    Here is a more than fair pension. 50 percent at age 62 averaged over the last 5 years of work, no pension spiking, pay 1/3 of their medical. That is more than fair and much more than we will ever get.

  • Joyce

    It would make more sense to dismantle the current obviously flawed pension plan by declaring bankruptcy like the city of Vallejo, rather than deprive taxpayers of services they currently need. Secondly, it would save the city a lot of money if fraud and future abuses of disability retirement by police and firefighters of San Jose were to be stopped. Please restore the honor that these public offices usually hold.

  • diggerduck

    a 90% retirement at 50 with 30 years of service! So the person would have to be hired on full time at 19-20 years of age!! Which is very very uncommon! Average age of hire is closer to 30 years of age which would put 30 years of service at 60.

  • diggerduck

    Pete Constant, retired on disability from San Jose PD, with a back injury. Seen sumo wrestling, sounds like fraud to me!!

  • pedro

    Lets be totally fair lets outsource all city workers. Stop retirements completely and have employee self contributing 401 plans (Why have city workers be special let them be treated like all the rest of California workers). Retirement plans died years ago) Lets be like Eastern Airlines go defunct (we are there already) let the fed take up payments and go for a industry standard 401K Demographically police and fire can make a lot more then the peoples they serve Reading is fun… Look at internet for averages makes for great reading…

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