San Francisco’s political leaders have no shortage of fiscal conundrums staring them in their collective faces these days: it is, after all, a terrible awful not so good budget year. In the face of a $522 million budget deficit, one might think that any measure that promises to save the city significant heaps of money — “anywhere from $500-$800 million dollars,” by one estimate — would be hailed as a savior.
Not so in this town. As astute colleagues have pointed out, a proposal by Supervisor Sean Elsbernd to reform the city’s employee retirement costs — in which future city employees would contribute 9 percent of their paychecks into the city’s retirement fund, instead of 7.5 percent, and final pensions would be decided by average salary over the last three years of employment, not final salary at retirement — could help reduce out-of-control city retirement spending by hundreds of millions of dollars.
Sounds good, right? Slam-dunk, right?
Wrong: labor unions successfully convinced Supervisor Eric Mar to amend Elsbernd’s proposal to make it labor-friendly and add another that’s even labor friendlier, one that might cost the city an additional $13 million. Mar wants final pensions decided by an average of an employee’s salary over the final two years of his or her employment, not three.
All proposals would need to meet voters’ approval at the June ballot in order to become law.
The latter proposal was abandoned on Tuesday, perhaps wisely. Supervisors will wait one more week to decide which one will be sent to the June ballot — Elsbernd’s three, or Mar’s two.
Big deal? Yes, a very big deal. The City Controller estimates Mar’s proposal would save 1/3 less money than Elsbernd’s. So why did Mar introduce it in the first place? Simple: labor called, and he answered.
“They [labor] asked it of me, and I said no,” Elsbernd said. “They asked it of Eric, and he said yes.”