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Does your legislator support pension reform in Wisconsin?
Arnold Schwarzenegger’s in a real bind. And lo and behold, one of his tough love measures is to (gasp) look at public employee retirement benefits. Gosh, that sounded familiar….
According to Tuesday’s Sacramento Bee, the plan would
- Not affect existing state employees.
- Extend retirement age from age 55 to age 60.
- Base pensions for police and firefighters on the highest 3 years instead of the highest single year.
- Provide lifetime health care benefits only for retirees who have worked 25 years.
- Lower the state’s contribution for retiree health care benefits form 100% to about 85% of the premium.
David Crane, a special adviser to Schwarzenegger on jobs and economic growth, estimated that the pension and health care proposals for future state employees could save taxpayers about $95 billion over the next 30 years. And after all that….
"We'd still have one of the finest pension systems in the country," he added.
Imagine that. Substitute Wisconsin in the news article and you’d have pretty much the same situation we have here. Not only are you struggling to fund your own retirement and 401(k), you’re paying nearly 100% of the retirement for state, local and school employees in Wisconsin. As I’ve said before in this space, it’s time public employees paid their fair share.
Macy’s. Starbucks.
Monday, USA Today summarized recent changes to employer matches in the private sector.
Hundreds of private-sector companies have cut partially or completely their employer matching contributions to employee 401(k) accounts (averaging 3% of employee pay). Check it out.
Similarly, hundreds have made “significant changes” to their defined benefit pension plans – which is the type of plan sponsored by the Wisconsin Retirement System for almost all public employees in the state.
The timing is exactly right for legislation, introduced by Representative Mark Gottlieb (R – Port Washington), that would require employees in the Wisconsin Retirement System to shoulder a minimum portion of their retirement fund costs. Rep. Gottlieb (R – Port Washington) explains it well, calling on his fellow legislators to once again join him in legislation calling for public sector employees to pay a portion of their own match.
Through collective bargaining, the five percent employee contribution to WRS has effectively been eliminated. Over 99 percent of all employee contributions are now made by employers on the behalf of their employees. In the current economic environment, and with almost no private sector workers enjoying employer funded, defined benefit pensions, it is simply unjustified for most employees to have no personal stake in the cost of their pension.
The Wisconsin Retirement System is a well-managed system that provides excellent retirement income security to state and local employees. Restoring some cost-sharing is a small price for employees to pay for this outstanding benefit.
LRB 2371/1 makes the first three percent of earnings that go into the employee share of WRS contributions a prohibited subject of bargaining under the Municipal Employment Relations Act. The effect of this change is to give municipalities, counties, and school districts the authority to require employees to pay a small part of the cost of their pension. If this bill is enacted, over 70 percent of the contributions to general employee pensions will still be made by employers. It’s time Wisconsin’s legislature and governor support this modest change. Has your state representative and state senator signed on to the Gottlieb legislation? (Al Ott has signed on. Representatives Bernard Schaber, Nelson, Zigmunt, Tauchen and Kaufert have not signed on as co-sponsors. Similarly, Senators Mike Ellis and Al Lasee have not signed on as co-sponsors.)
Jo Egelhoff, FoxPolitics.net
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