FREE e-Newsletter
Important News - Hot Topics
Get them Now!
William Harvey

William Harvey

William "Bill" Harvey is currently serving as chief of police in south central Pennsylvania. He retired from the Savannah (Ga.) Police Department where he worked assignments in training, patrol, and CID. Harvey has more than 25 years of experience working with recruits, rookies, and FTOs.

Security Policy and the Cloud

Ask The Expert

Mark Rivera

FBI-CJIS Security Policy Compliance Officer

Mark Rivera, Customer Retention Manager and CJIS Security Compliance Officer with Vigilant Solutions, served for sixteen years with the Maryland State Police, retiring at the rank of First Sergeant with thirteen of those years at the supervisory and command level. He holds a Master of Science Degree in Management from The Johns Hopkins University and Secret clearance through the FBI, Baltimore.

Careers

Reckless Pension Reform In Los Angeles

A pension-reform initiative backed by Los Angeles' former mayor would be a step backward.

November 13, 2012  |  by Los Angeles Police Protective League

CC_Flickr: 401(K) 2012
CC_Flickr: 401(K) 2012

Editor's Note: This blog post first appeared on the Los Angeles Police Protective League's website.

Former Los Angeles Mayor Richard Riordan has taken the first steps toward eliminating the current pension system for all future city employees, including LAPD officers, and replacing it with 401(k) plans. However, this proposal will not only impact the pay and benefits of current employees, who have already given years of service to the city, but it will be detrimental to Los Angeles taxpayers.

Under the Charter Amendment proposal, which needs signatures from more than 254,000 registered voters by Dec. 7 to qualify for the May 21, 2013 election, Riordan's proposal would close the current pension systems and have all future employees adopt 401(k) plans. Please tell your friends and family that if they value the work of police officers, firefighters and other city workers, they should not sign this petition.

The Riordan scheme has the catchy ballot title, "Bankruptcy Avoidance and Pension Protection Act," when in reality the cost of closing the three pensions plans is projected to cost taxpayers nearly an additional billion dollars in the next decade alone. His poorly thought-out plan does not save the city money, despite his witty sound bites, but instead may lead the city to bankruptcy.

The plan Riordan is proposing immediately becomes more costly to the city. The reasons are twofold: (1) the pension system will have a shorter investment horizon and a lower return rate; and (2) the time to pay the unfunded liability is reduced. In short, it ends up costing taxpayers billions more.

In the past year, nine states considered switching their new employees to 401(K) plans. Every single state that considered it did a thorough independent study and then rejected the switch for one reason: because it does not save taxpayers money and in fact would cost taxpayers billions more!

City Administrative Officer Miguel Santana has examined a possible shift to a 401(k)-style system, but found it would cost the city even more than the current system. The study found that the city would still be liable for the benefits to be paid to workers covered by the existing system without the benefit of new contributions from the new city workers.

It is disappointing that the Charter backers may likely bankrupt the city by pushing a plan that is more costly than the current pension systems. Thoughtful analysis and real solutions are needed to solve public employee pension issues—not Wall Street double-talk and Charter changes that are poorly thought out, more expensive and legally dubious.

The Riordan plan is reckless in light of all the publicly available reports from many different states that such a drastic change will cost taxpayers billions.

Richard Riordan is factually wrong about all the pension plans and has no independent analysis to back up his numbers. The Riordan scheme will bankrupt the city. We urge all residents not to sign the petition that would put this poorly thought out plan on the ballot.

Related:

Former L.A. Mayor Launches Petition To Give Cops 401K Plans


Get Your FREE Trial Issue and Win a Gift! Subscribe Today!
Yes! Please rush me my FREE TRIAL ISSUE of POLICE magazine and FREE Officer Survival Guide with tips and tactics to help me safely get out of 10 different situations.

Just fill in the form to the right and click the button to receive your FREE Trial Issue.

If POLICE does not satisfy you, just write "cancel" on the invoice and send it back. You'll pay nothing, and the FREE issue is yours to keep. If you enjoy POLICE, pay only $25 for a full one-year subscription (12 issues in all). Enjoy a savings of nearly 60% off the cover price!

Offer valid in US only. Outside U.S., click here.
It's easy! Just fill in the form below and click the red button to receive your FREE Trial Issue.
First Name:
Last Name:
Rank:
Agency:
Address:
City:
State:
  
Zip Code:
 
Country:
We respect your privacy. Please let us know if the address provided is your home, as your RANK / AGENCY will not be included on the mailing label.
E-mail Address:

Police Magazine