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California pension overhaul: Hurdles remain, and clock is ticking

The clock is ticking on Democrats’ efforts to make changes to the state’s public pension system, and according to state law and legislative rules, a lot has to happen before any legislation can come up for a vote.

For starters, Democratic leaders and Gov. Jerry Brown need to reach a final agreement on a couple of key sticking points. Brown fleshed out his 12-point pension proposal earlier this year, a plan which was openly embraced by Republicans in the Legislature.

But Democrats have balked at Brown’s call for a hybrid plan for new employees that would blend a 401(k)-style plan with the current guaranteed benefit system. Talks are now centered on where to cap the amount of an employee’s salary that could be used for the guaranteed benefit, according to sources close to the pension discussions.

The two sides are also at odds over Brown’s proposal to split retirement costs evenly between employees and employers. Brown called for a 50-50 split for all current and future state employees. Democrats want those discussions to be subject to collective bargaining negotiations.

There is continuing disagreement on where to set the retirement age for most public workers. Brown wants employees to be 67 before they would be eligible to receive a full pension.

But reaching agreement is just one of the obstacles to be overcome. According to state law, any changes to state pensions must be subject to a full actuarial study before being approved. Legislative sources said no such study has been conducted yet, which makes sense, given the fact that there is no final agreement to analyze.

Lawmakers are also running out of time to hear the bill. According to legislative rules, the deal must be in print one “legislative day” before being voted on in committee, and three calendar days before the end of the legislative session. This year’s session ends on Friday.

Those legislative rules can be amended, but only with a two-thirds vote of the Legislature, which means Republicans would have to go along. But the recent track record by Democrats to get Republican votes for controversial proposals is not a good one.

That means a final deal would have to be in place, and in print, no later than Tuesday morning or risk falling apart altogether.

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-- Anthony York in Sacramento

 
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