Sacramento , CA — Last week, the California State Assembly’s Public Employees, Retirement and Social Security Committee unanimously passed AB 1184 authored by Assemblyman Mike Gatto (D-Los Angeles). The legislation would force cities that recruit staff by offering exorbitant salaries to bear the burden for the increased pension costs that result.
Currently, the taxpayers of the previous cities at which the employee worked (and ultimately, the state pension funds) have to bear those pension costs. The legislation would prevent city councils like Bell’s from saddling taxpayers in other cities with enormous debt. As just one example: Bell lured the police chief of Glendale by offering him over a 100% raise, from approximately $200,000 a year to over $400,000.
Under the existing system, however, Bell is only responsible for 3% of the chief’s pension payments, leaving the previous cities at which he worked to pay 97% of the chief’s $400,000-plus pension. Gatto’s bill also contains a provision prohibiting cities by trying to go around federal and state pension caps by seeking excessive private pensions. “I was very pleased to see the bill proceed, as the current status quo is in need of reform. The bipartisan support my bill received indicates that a broad group of the peoples’ elected representatives believe it to be a sound solution.”
The committee hearing featured testimony from a cadre of pension experts. One witness testifying in support of the bill stated that AB 1184 stated, “this will do more to cap the runaway pensions than any bill you’ve seen in here or heard yet.” “Many people are suffering right now. The small group of people who’ve manipulated their pensions are turning public opinion against the very concept of retirement security. I believe this bill will eliminate the possibility of bad actors taking advantage of an antiquated system,” said Gatto.
(Mike Gatto is the Assistant Speaker Pro Tempore of the California State Assembly. He represents the cities of Burbank, Glendale, and parts of Los Angeles, including Los Feliz, North Hollywood, Silver Lake, Toluca Lake, Valley Glen, and Van Nuys. Website of Assemblyman Mike Gatto: www.asm.ca.gov/gatto)