Orange county file lawsuit to void pension agreement
The Los Angeles Times (1/30, Berthelsen) reported that California's Orange County supervisors "voted unanimously Tuesday to file a lawsuit seeking to repeal part of their pension agreement with sheriff's deputies, saying the county cannot afford the expense." Should the county prevail, it would save "$187 million in the coming decades" but also face the "wrath of one of the county's most politically powerful unions."
The lawsuit was driven largely by Chairman John Moorlach, previously the county's treasurer, who "has long advocated reforming the generous deals of county's pension agreements with its public employee unions" -- much like those struck elsewhere in the state in recent years -- that have "created an estimated $2.3-billion pension fund shortfall over the next 30 years."
A good example of a "defined benefit" pension program, the provisions allowed public Sheriff deputies to retire at age 50 with annual pension payments totaling 3% of their highest year's pay, multiplied by their years of service -- an increase from 2% under the previous deal -- and granted the benefit retroactively. Deputies, "on average," retire with an annual pension of $70,000 [received until they pass away].