California pension initiatives in uphill struggle

From all appearances, the proposals to reform the public employee pension system through California's initiative process are grass-roots efforts short on bodies and cash.

Marcia Fritz, a reform activist proposing two measures, said she was hoping for business community support so her group could hire signature gatherers to put the initiatives on the November ballot. But business groups have been timid about supporting the petition drives, she said last week.

About $2 million is needed to hire workers to gather close to 700,000 signatures for each measure, she said. She declined to say how much has been raised; no information was available on contributions.

"We are struggling," she said. "It takes money and people with backbone to confront what everyone knows is wrong, but everyone keeps looking at their shoes."

Fritz is vice president of the California Foundation for Fiscal Responsibility, based in Citrus Heights, a nonprofit group that publishes the "$100,000 club" lists of retirees getting lucrative pensions from the California Public Employees' Retirement System, the California State Teachers' Retirement System and county pension systems.

The group has sounded the alarm about the growing financial burden for public agencies that give generous pensions to public employees. Fritz's ballot measures would amend the state constitution to raise the minimum retirement age and reduce the pension and retirement health benefits for public employees hired after July 1, 2011.

But without financial backing, the initiatives could die before the June 14 deadline for collecting signatures.

"The Republican candidates for governor don't seem to want it on the ballot, and the business interests that look to CalPERS for investment dollars don't want to get in bad graces with CalPERS," Fritz said.

A California Chamber of Commerce spokeswoman said last week that the group has not taken a position on the pension reform proposals. The chamber had no comment on whether it would give campaign dollars to the cause.

Under the proposed measures, newly hired police officers and firefighters would have to wait till age 58 to draw pensions, which would be limited to 75 percent of salary. In California, most sworn public safety personnel can retire at 50 with up to 90 percent of their top annual pay, a benefit that threatens to become a financial drain for public agencies across the state.

Other government workers could not draw full pension benefits until age 66 under the proposed initiatives. They could retire earlier with lesser benefits.

According to the legislative analyst's office, the long-term effect of Fritz's initiatives would be major reductions in public sector pension costs, potentially in the range of 50 percent or more.

Another proposed initiative also would apply to new employees, as the pension promises for current public employees are usually established in labor contracts.

The measure written by Southern California resident John Romano would limit pension payments to $100,000 a year upon retirement. Retirees could receive cost-of-living increases tied to the Consumer Price Index, but pensions would be capped at $162,500 a year.

Romano, an entrepreneur and rock musician, said he has no financial backing to help him collect the required 434,000 petition signatures.

Signatures are being collected online at http://DownloadPetitions.com and by a small group of volunteers, he said.

"With this kind of initiative, there is not a giveaway for special interests, so it is difficult to raise money for it," he said. "I wrote a common- sense initiative and I am hoping for the power of the people to get it on the ballot."