Monday, November 26, 2012

Riordan Pulls the Plug on Plan to Gut LA Pensions

Former Los Angeles mayor and Republican gubernatorial candidate Richard Riordan announced today he would no longer try to qualify a local initiative for the ballot on Los Angeles to gut public employees' pensions.  Riordan's plan called for replacing the defined benefits pension most public employees have where employees earn credit for each year they work with a defined contribution plan where retirees would get an unpredictable about of money depending on the stock market and other investments.

The plan was widely criticized by labor groups.  The Los Angeles Police Protective League revealed Riordan never conducted a study on whether the plan saved the city money and that it could actually cost much more in the immediate future.  Other labor groups cited the changing public opinion on pensions since Governor Brown's statewide pension reform package passed in August.  Riordan pulled his plan today acknowledging he would be unable to gather enough signatures to put it on the ballot.