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Trim public pensions for new hires, voters say

A solid majority of California voters think state and local governments should make pension benefits for new hires less lucrative than the current system, according to a new Field Poll released Thursday.

However, that same survey of 1,005 registered voters in the state indicated that only a third of those asked think that pensions for current employees are too generous.

More than half believe that state and local government worker pensions are about right or not generous enough.

Meanwhile, a majority of voters surveyed approve of somewhat more generous pensions for safety workers such as firefighters and police than for other public employees.

The responses were part of the independent Field Research Corp.’s first-ever polling on public pensions at all levels of government.

Although there’s no previous data for comparison, Field Poll director Mark DiCamillo noted that 45 percent of voters who said they pay attention to state government issues believe public employee pensions are too generous.

"They’re the group most critical of public pensions," DiCamillo said. "And usually it’s those ’close attenders’ who pull the rest of the public with them."

Gov. Arnold Schwarzenegger raised the profile of an already-hot issue when he called earlier this year for new state hires to receive less generous benefits than current employees. The idea has failed to gain traction in the Democratic- controlled Legislature.

Taxpayers nevertheless can expect to hear more about public pension costs in the coming decade.

The California Public Employees’ Retirement System, the nation’s biggest state and local government pension provider, has lost tens of billions of dollars on soured investments during the recession.

The fund has recovered somewhat with the stock market’s rebound, but it still will have to demand more from governments — and ultimately taxpayers — to make up for losses.

Local governments from Eureka to Vallejo to San Diego are grappling with growing retiree costs, while tax receipts have dwindled during the economy’s downturn.The topic has become fodder for radio talk shows and interest groups who want to roll back benefits.

The California Foundation for Fiscal Responsibility has made hay with two databases that name retirees in the "$100,000 Pension Club," former California educators, state and local government employees with six-figure pensions.

In response to these criticisms and others, CalPERS last month launched "CalPERS Responds." The Web site presents its side of the story, including a "myths vs. fact" page:

Myth, according to the Web site: "Public pension benefits are excessive and a drain on the public." Fact: "Only 1 percent of the nearly half million CalPERS retirees receive annual pensions of $100,000 or more. Many are retired nonunionized or specialized skilled employees or other high wage earners who worked 30 years or more.

Many served in high-level management positions." The so-called "defined benefit" retirement packages common in government work cannot be changed once promised, unlike 401(k) plans whose value corresponds to investment gains or losses.

Sixty percent of voters polled favored setting an upper limit on the amount that newly hired government workers receive at retirement, with 31 percent opposed to the idea.

Replacing defined-benefit pensions with 401(k) savings plans found favor with 56 percent of those polled, with 35 percent opposed. And 51 percent favored a Schwarzenegger- style plan to reset pension formulas for new hires. Thirty-eight percent didn’t want that. Denice Massey-Daniels, a 39-year-old lab technician in Stanislaus County who participated in the poll, said she believes public employee benefits are too rich.

"They get a lot more than the rest of us," she said. "It’s not right."

Thirty-two percent of those polled agreed with that assessment, twice as many as those who think the benefits aren’t generous enough.

A plurality of the state’s voters, 40 percent, figured that public employee pension benefits are about right.

"There’s a tendency to focus on people at the high end and paint everyone with the same brush," said Grant Nicol, a 66-year-old Carmichael resident whose responses fell into that category. "I’m afraid the politicians will change things and wind up screwing people in the middle and at the lower end."

A suggestion by some pension reformers to tax public pension benefits over $50,000 per year doesn’t have much traction with voters. Only 34 percent favor the idea, while 58 percent oppose it.

Republicans, men and conservatives were all more inclined to think government pensions are too generous, according to the poll. Democrats, nonpartisans, women, voters under 30 years old and moderate conservatives were more likely to think retirement benefits aren’t generous enough.

The public’s esteem for public safety workers surfaced in the poll as a willingness to pay them more generously when they retire.

Overall, 52 percent of voters think police, firefighters and others like them deserve somewhat better pension benefits than other state workers.

Retirement formulas for public safety employees generally allow them to retire earlier, with a greater percentage of their wages.

California Highway Patrol officers, for example, can retire at age 50 and draw 3 percent of their highest annual pay multiplied by the number of their service years. Other state workers have to wait longer to retire, and a smaller percentage of their income figures toward retirement.

"But that doesn’t mean the public doesn’t want public safety pensions to be less generous for future public safety hires," said poll director DiCamillo. "It’s a relative thing."

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