Gov. Jerry Brown stands up to union on pensions
As communities across California struggle with mounting pension burdens, Gov. Jerry Brown has come to the defense of pension reform in a state Supreme Court case.
In Cal Fire Local 2881 v. California Public Employees Retirement System, the union representing state firefighters is challenging a provision of the Public Employees’ Pension Reform Act of 2013 ending the practice of “airtime” purchases.
Airtime refers to fictitious years of public service used to calculate the size of their pensions. Prior to the passage of PEPRA, government workers could purchase as much as five years of credit for public service they didn’t necessarily do, thereby manipulating a system intended to provide a pension in exchange for public service.
Like other forms of pension spiking, the purchasing of airtime added significantly to the state’s unfunded pension liabilities due to a mismatch between how much in benefits a retiree receives versus how much those benefits were funded. It also enabled many government workers to retire early, which caused problems throughout the state.
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“Ending the costly, imperfect practice of selling additional ‘service credit’ untethered to service was necessary to re-align pension benefits with public service, eliminate a cause of premature retirements, and address a well-established source of unfunded liabilities never intended by the legislature,” the Brown administration argues in a recent court […]