Long Beach became the largest CalPERS city to achieve full pension reform today after the City closed deals with its last four remaining bargaining units.
Those agreements—reached amongst engineers, lifeguards, confidential, and management, which represents about 14% of the City’s workforce—essentially used the same pathway that was sought to reach last year’s agreements with police, fire, and IAM members.
Essentially, current employees will fully cover their pension costs—either 8% or 9% of their salary—while also receiving a 1.3% salary raise per year beginning in 2015. The fiscal years (FY09-13) in which they have not received a salary raise—minus confidential, which received a 3% salary raise in 2009—have thus far saved the City some $6M from the General Fund and $26M in all funds. The halt in salary increases will continue until FY15.
Together with the previous pension agreements, the City claims they will now save some $250M across all funds, of which over $130M in the General Fund alone will be saved from FY14 to FY24.
“Long Beach has become a smaller, more nimble organization, reducing management in City Manager Departments by 28 percent and eliminating 786 total positions since 2007,” said Mayor Bob Foster in a release. “But we needed to address an issue of inequality in the City organization and compensate our remaining employees fairly. We ask a tremendous amount of these employees, and will continue to do so as we trust them with the management of the City’s improving finances. Without these agreements, Long Beach may just become a training ground for other cities; a City that cannot attract or retain talent, yet grows talent for other cities. If that happens, this will not be the City we all want it to be.”