Posted on July 31, 2012 at 4:14 PM by Liz Pharis
The Revenue and Taxation Committee spent most of the day focused on two agenda items.
2012 Pension Reform
Pension Reform is once again at the forefront and the League expressed that the State's Legislature is poised to begin earnest work on pension reform immediately after the budget is adopted with an effort to approve reform before the end of the current legislative session. The current reform being brought forward follows the Governor's 12-step plan in general, but makes some key modifications that should benefit current employees and public agencies. The Governor's reform plan called for a mandatory hybrid plan combining both defined benefit and defined contribution plans for employees. The revised proposal will likely include a stacked hybrid plan which will provide defined benefit up to the Social Security earnings limit, defined contribution plans for earnings above social security but less than $250,000 and then no additional employer funded plans for employees earning in excess of $250,000 per year. In terms of cost sharing, the Governor originally proposed a mandatory 50/50 cost-sharing plan and under the proposed revisions, cost sharing would be left up to the collective bargaining of each individual agency. Lastly and probably most important to current public servants is that these new plans would only apply to "new hires" and "new hires" would be defined as new to the pension system in general and would not apply to an individual leaving one agency for a position with another agency.
The Cap and Trade Policy
In regards to Cap and Trade, the Committee spent most of its time discussing how it would recommend the proceeds from the Cap and Trade Auctions be spent. The committee agreed that there should be a local funding component, especially in terms of transportation, but was not unanimous in its directly. It appeared that based upon region, some believed it would be best to designate local funds to a Council of Government (COG) while others were more concerned (LA County Cities) that certain larger members of the COG would control the funds and they would not be spread equally amongst all agencies. I believe that most if not all the committees took some type of look at the Cap and Trade program and the results between committees may vary greatly.
Matt Hawkesworth, City of Rosemead