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California pension reform may take back seat to budget fix

May 2, 2012 |  2:52 pm

Faced with worsening budget problems, chances are growing that the Legislature won’t vote on  comprehensive pension reform until the end of the session in August, some officials said Wednesday.

Democratic leaders are concerned that with revenue projections falling short, they are going to have to make more cuts that affect unions and others who also have concerns about changes to pension benefits.

Pushing budget cuts and pension changes at the same time could create political problems jeopardizing pension reform, according to one legislator with knowledge of negotiations but not authorized to talk on the record.

"It would be a double whammy," the legislator said. "It would be like hitting them with a two-by-four twice." Other legislative sources confirmed that there are discussions about delaying final action on pension reform until August.

Asked about the timing of a vote, Senate leader Darrell Steinberg (D-Sacramento) was noncommittal Wednesday. "It’s our obligation to deliver comprehensive pension reform this session," Steinberg told reporters at the Capitol. "When exactly, whether it is before or after the budget, I don’t know. It depends upon conversations with the governor and the Assembly as well."

Steinberg said  recent revenue figures have failed to meet expectations.  "We are going to engage undoubtedly in having to make some more cuts."

A conference committee on pension reform is wrapping up work on its recommendations, but a lack of decisive action after six months of hearings has drawn criticism from Republican members of the panel. In recent days, they have accused the majority party of dragging its feet on the governor’s proposal to increase the retirement age and require some pension benefits to come from a 401(k)-type plan for new hires.

"The failure of the Legislature to pass or honestly engage in fixing our pension systems means the state’s debt will rise faster," Sen. Mimi Walters (R-Laguna Niguel) said.

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-- Patrick McGreevy in Sacramento

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