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Assemblyman Jim Beall is calling for San Jose’s elected officials to delay placing a pension reform initiative on the June ballot amid reports that the mayor’s office exaggerated projected retirement costs. Three unions have filed an ethics complaint with the city’s elections commission alleging that Mayor Chuck Reed, the city’s retirement services director Russell Crosby, and former retirement services employee Michael Moehle propagated to the city council and the public “knowingly false, misleading and deceptive fiscal year 2015-2016 city pension contribution cost of $650 million.
” It was an estimate that Crosby conjured off-handedly at a Feb. 14, 2011 budget meeting and one that Reed ran with despite being informed that the figure was not actuarially accurate, alleges the complaint. “Given the fact that the numbers in the various reports have changed so much the council ought to do a re-investigation and maybe an independent evaluation,” Beall said from the California Democrats State Convention in San Diego today. He suggested that the ballot measure, which the city council voted to place before voters on the premise that skyrocketing retirement costs are resulting in service reductions and layoffs of hundreds of workers, including police officers and firefighters, be revised or delayed.
“My perspective is based on my experience that you don’t jump into something without the proper information,” Beall said. “When you present stuff to the voters you have to make sure it’s accurate and correct and not overestimate.” Beall, who served 14 years on the San Jose City Council before serving in the state assembly, said he is concerned that a reliance on ballot measures to tackle the city’s problems will constrain the city council and eventually result in a dysfunctional budget process akin to California’s budget.
“I think that’s a danger to do that kind of ballot box legislation,” he said. “We don’t want the city of San Jose to turn into the state of California.” Beall urged the mayor and council to consider alternative solutions and await the adoption of Gov. Jerry Brown’s 12-point pension reform plan.Earlier this month, Brown delivered the proposed language for his plan to the legislature’s conference committee on public employee pensions. The plan requires a two-thirds majority vote of the legislature before it can be placed on the Nov. 6 ballot, and a majority vote from residents.
Sam Liccardo, one of six council members who voted in favor of the controversial ballot measure, on Thursday denied that the city has relied on the $650 million dollar estimate and dismissed the unions’ claim as a “straw man” argument.Reed’s proposal calls for setting limits on retirement benefits for new employees and retirees, but the ballot measure would not reduce payments to current retirees or cut accrued benefits that employees have earned for the past five years of service.
The latest version of the ballot measure includes reforms such as placing new employees into a lower-cost, hybrid retirement plan and giving current employees the option to either keep their current retirement plan by paying a larger share of the cost or switching to a lower-cost plan. The complaint, filed on Thursday by the San Jose Police Officers’ Association, San Jose Firefighters Local 230, and the International Federation of Professional and Technical Engineers Local 21, was based on a KNTV investigative report.
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