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  Real and Lawful Pension Reform

The reforms that San Jose Police Officers Association (SJPOA) and San Jose Firefighters are proposing differ from Mayor Reed’s in substance and effect.  At the onset of open negotiations on retirement reform, Local 230 opened with a proposal that went unanswered.  This occurred in February of 2011.  On June 7, 2011 when City staff was finally directed to open negotiations on Retirement Reform, Local 230 was again ready to, in good faith, find effective solutions to bring down retirement costs.  To pension.jpgaddress the City’s stated concerns about the difficulty in dealing with multiple bargaining units, Local 230 and the SJPOA requested a joint bargaining approach.

At the bargaining table, the City has continued to press forward with ballot initiative language and the declaration of fiscal and public safety emergency.  With serious concerns about the severe legal risk the City’s approach poses, the Police Association and Fire Union endeavored to approach the problem in a different way.

Local 230 and SJPOA identified specific concerns stated by the City.

These included, but were not limited to:

  • Rising pension cost projections
  • Increasing age and years of service requirements for retirement
  • Sick leave balance payouts
  • High disability rates
  • Pension spiking
  • Pre-funding of retiree health care
  • Supplemental Retirement Benefit Reserve (SRBR)
  • Cost-of-Living Adjustments (COLA)
  • Difficulty in negotiating with multiple bargaining units in different plans

Local 230 and SJPOA also had concerns regarding the current status of our pensions: which included rising pension costs, legality of reforms to address those costs, employee recruitment and retention, market parity, protection of City services, and police and firefighter safety.

The issue-by-issue approach proved to be very productive.  The result is a proposal that we and our actuary believe will reduce costs by about $277 million dollars from FY12 through FY16.  (Click here to view the proposal dated September 27, 2011)

Combined with cost reduction proposals from IFPTE-Local 21 in the Federated Plan and cost reductions proposed by the Police & Fire Retiree Association, labor brings to the table $467 million dollars in cost reductions over 5 years.

Our proposal is a 3 Tiered model that legally avoids a Vested Benefit challenge, offers a viable cost-saving benefit option for the majority of our members (members too are seeking relief from rising costs), and finally, offers a “Measure W” compliant solution for new employees.  Additionally, our proposal effectively addresses all of the identified City concerns and those of our members.

We believe that advancing the City’s ballot initiative will result in certain litigation.  In the near term, the only winners will be the attorneys.  Waiting several years for the courts to solve our problems is neither an appropriate nor an effective solution.  Worse, when these issues are tied up in court, needed changes can be delayed for years--costing the city tens of millions of dollars and bringing additional uncertainty to our members and the public.   Please click here to see the highlights of the our proposal that will reduce City costs by $277 million dollars from FY12-FY16:

Thank you,

Robert Sapien, Jr., President
San Jose Fire Fighters, IAFF Local 230


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