City Hall

Los Angeles Considers Slashing Pensions, Doubling Tax on Property Sales

Comments (0)


Wed, Aug 22, 2012 at 9:02 AM
click to enlarge BFISHADOW / FLICKR
  • BFIShadow / Flickr

As the L.A. City Council engaged in closed-door talks this week about how to reduce the exploding costs of paying retired workers to do nothing, at least one union said hell no.

The Service Employees International Union (SEIU) Local 721 put its foot down, saying that workers have already done their part to reduce city costs, including previously agreeing to reductions in their own pensions.

But at City Hall yesterday, talk was of a whopping ...

... 67-year-old retirement age (versus today's 55), not to mention limiting pensions to 75 percent of a working employee's salary (some city workers get more than their average salary because, in part, pension is often based on their last year's income).

This under a proposal by Mayor Antonio Villaraigosa, who wants to base pensions on a five-year salary average instead of that last, pork-barrel year of employment.

click to enlarge city_hall_night.png

He also wants to halve retirees' heath care costs for taxpayers, from $1,190 per month to $596.

The city is looking at ballooning pension payments that could take up a third of the budget. As it is, fire and police services take up more than 70 percent of L.A.'s cash. That leaves room for ... almost nothing else.

City News Service broke down the latest figures:

Taxpayers are expected to pay close to $843 million toward civilian and public safety workers' retirements during the current fiscal year. The contribution is expected to rise to $1.3 billion by 2016. The rising pension obligation means there will be less money the city can use for services like street repairs and public safety.

Making those cuts is still in "study" mode at the City Council, however.

At the same time, the City Council voted yesterday to (also) study putting a measure on the ballot that would ask voters to double the city's tax on property sales.

L.A. is facing a $200 million-plus deficit for the next fiscal year (which is, frankly, business as usual) and needs the $100 million the tax increase would bring. (Guess all the extra parking and speeding tickets being doled out by the LAPD these days aren't doing the trick.)

Meanwhile, in a statement to the Weekly and other outlets, the SEIU's Local 721 said employees have already given the city plenty of concessions and don't want a "two-tier" system where newer employees get radically fewer retirement benefits.

The SEIU's Art Sweatman:

... We have already sacrificed, in order to maintain vital public services. Last year, we agreed to raise our retirement fund contributions to 11 percent of our salaries. This saved the city $63 million in one year. It will save the city $810 million over five years.

Any more pension 'reform' is out of the question for us.

[With reporting from City News Service / @dennisjromero / djromero@laweekly.com / @LAWeeklyNews]

Related Content


Now Trending

  • Jay Z Grand Park Concert Is Official as Mayor Plans Announcement

    It looks like Mayor Eric Garcetti is going to officially announce that a two-day "Budweiser Made in America" festival is taking place  at downtown L.A.'s Grand Park. The mayor's office said today he " will make an announcement with Shawn "JAY Z" Carter, Supervisor Gloria Molina, City Council President Herb...
  • L.A.'s Top 10 Streets for Bicycle Crashes Revealed

    You're probably already aware that there's a hit-and-run epidemic in L.A., and that bicycling in a car-crazed capital like Los Angeles can be hazardous to your health. See also: Critical Mass Bike Ride Recognizes L.A. Hit-&-Run Victims But the nerds at the MIT Media Lab's Social Computing Group recently came up...
  • "Compton Division" Pimps Made Millions, Cops Say

    A trio of local pimps forced women to work the streets from San Diego to Las Vegas and beyond, cops say, and they allegedly made millions doing so. But now 31-year-old Robert Walker, 34-year-old Daniel Gunther, and 34-year-old David Sheffey, who called their crew the Compton Division, are behind bars, says...