New Police Contract Could Save Anaheim $1.6 Million

Last night the Anaheim City Council voted 4-1 to approve a new, two-year contract with the Anaheim Police Association that ends a practice that increased pension benefits, and starts new hires at a less generous defined-benefit retirement. Mayor Tom Tait voted against approval.

From the Voice of OC:

Under the contract, the pension formula for new members of the Anaheim Police Association is 2.7 @ 57, which means that upon turning 57 an officer can receive a pension equal to 2.7 percent of their salary for each year served. 

This means that after 30 years of service, officers can retire with 81 percent of their final salary. Current members of the Anaheim force are covered by a 3 @ 50 formula that allows them to collect up to 90 percent of their salaries after 30 years of service.

According to Anaheim Human Resources Director Kristine Ridge, the agreement saves approximately $1.6 million over the term of the contract, mostly by eliminating the “pers-on-pers” benefit by which the city paid the employees’ 9 percent contribution to the state’s public employees retirement system, then reported it as part of employees’ salaries.

With this benefit in place, the pension calculation of a retiring officer earning $100,000 would be based on $109,000.

Members will be contributing toward their retirement, beginning at 4 percent in February 2014 and reaching 12 percent in January 2015. Corresponding salary increases, however, will offset those contributions.

I don’t think there’s any reasonable person who disagrees that the current pension system is unsustainable and that reform is necessary, or else one day these pensions won’t be there for the retirees. It’s a mark of how the political tide on this issue has changed that the argument is no longer about making these contracts more generous, but how far to go in the other direction.

If there is a silver lining in this whole issue, maybe it will be motivating the pension-dependent special interests that control the Democratic Party to wake up and pressure the Governor and legislators to seriously slash the thicket of taxes, regulations and environmentalist nuttiness that is stifling economic growth — because there is no way to shrink the unfunded pension liabilities without robust economic growth.

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  1. Victor Dominguez

    Why did Mayor Tait vote against it?

  2. He thought the Council should impose a lower formula even though that option was not allowed by state law. Confusing that Councilman Tom Tait voted for 3@50 but voted against substantial reform with this agreement as Mayor. Also ironic, the 2@50 is still allowed under the system approved by council last night if police retire earlier. His arguments were nonsensical. Likely just payback because the APOA are fighting his plan to impose a political civilian oversight committee.

  3. Classic Tait…Do as I say, not as I do.

    Last night saw him huff and puff about slashing pensions and waving a banner for reform, yet when the whole fight surrounding his Council Aide was brought forward not once, NOT ONCE, did he suggest that perhaps she should reduce her pension.

    She has the most generous pension contribution rate in the City (better than the police do right now,) and that is what blew his support budget. Not treachery or meanness – just plain old fashion greed.

    Funny how last night he could suddenly remember his arithmetic.
    There is nothing “kind” about being a hypocrite.

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