A parade of barrel-chested firefighters and police officers lined up, scores deep, at the microphone. Yes! they said, over and over again. Give public agencies the power to sidestep pension reforms and sweeten our retirement formulas!

One could almost hear the tinkle of coins draining from the public purse.

Critics might have mistaken this Sacramento hearing for one of those post-9/11 love fests — the ones where elected officials fell all over one another to dramatically, enthusiastically and (critically) retroactively hike pension formulas to demonstrate their support for first responders’ dangerous work. That retroactive bit meant that they promised money for past work that they had never set aside in investment accounts — engaging in fantastical thinking that the increases would magically pay for themselves thanks to a booming stock market.

HA! They didn’t. California has dug itself a pension hole some $352 billion deep instead, and the dramatically higher pension set-asides that public agencies are now saddled with — trying to fill that hole — gobble up nearly 1 of every 5 dollars from some city budgets. That, in turn, crowds out services to residents.

But alas, there was no mention of the depth of the current pension hole at this April hearing on Assembly Bill 1383 by Assemblymember Tina McKinnor, D-Hawthorne. Much like its cousin AB 569 by Catherine Stefani, D-San Francisco, it would free agencies to wiggle around reforms muscled through the Legislature by then-Gov. Jerry Brown more than a decade ago — reforms aimed at taming the explosive growth in public pension liabilities. It would let them, potentially, dig the hole ever deeper.

That’s scary because, even with Brown’s reforms, the hole has yawned wider and wider. That’s because the new rules apply only to new hires, who won’t retire for many years.

McKinnor’s bill would allow public agencies to goose pension formulas for these “new” public safety types (already the most expensive) higher — while at the same time reducing the retirement age, erasing some of the $42 billion to $55 billion savings that Brown said the reforms would eventually provide.

One concession to history: McKinnor’s bill would not apply to past work — only to work going forward. So at least there’s that.

But a bit of history ignored by lawmakers at the hearing, to taxpayers’ peril: the fact that when one, single, wee little agency adopts sweeter formulas, a benefits nuclear arms race begins.

City B says, “We’re losing firefighters/police/etc. to City A because City A has better benefits!” Which leads city B to sweeten formulas. Which pressures City C to do the same to keep its workers, followed by City D, and City E, etc., etc.

Legislators! This is precisely how we got into this hole! It started in 1999 with Senate Bill 400 under then-Gov. Gray Davis (remember him?!), boosting benefits for the California Highway Patrol. That sparked a benefits wildfire that burned through thousands of public agencies in California, costing billions upon billions of dollars. “The single greatest issuance of debt in state history,” it has been called.

So. Here we go again?

Lives or money?

“With each passing year, we learn more and more about how dangerous this profession really is,” Brian Rice, president of California Professional Firefighters, told the Assembly Public Employment and Retirement Committee in April.

“Where heart disease used to be the most common affliction for firefighters, it’s now, unquestionably, cancer. … Every day spent on the job means more exposure to deadly, potent carcinogens like diesel fuel, PFAS, asbestos, benzene … there are so many substances that mix with fire that are so toxic to the body that you can’t even name them all. Each day is a cost. A cost we pay for with our lives, a little bit at a time.”

Rice’s organization represents some 35,000 firefighters and emergency medical personnel, and it seemed like most of them were there as he spoke.

“The job is physically and mentally demanding in the extreme,” he said, “and asking us to work until 57 years old is pushing us not just to our limit, but beyond our limit. I don’t want to bury another friend before their time in the name of hypothetical cost savings. And that’s what we’re talking about here. We’re trading firefighters’ and police officers’ lives for money. Period.”

McKinnor feels we owe first responders more. “In Los Angeles, we just had one of the biggest fires we ever had,” she said. “They deserve to have this. I really truly respect these first responders and how they put their lives on the line for us.”

Furthermore, California is experiencing a “crisis of vacancies” in the public sector, she said, and “competitive retirement benefits are critical to ensuring an adequate and well-trained public safety workforce.” This, she maintained, will help fill those slots.

The bill analysis said, “FISCAL EFFECT: Unknown.”

Before and after

There was a dispiriting dearth of data presented at the hearing, so let’s do some of that now.

It’s worth noting that only about 4% of emergency calls in California are for fires. The vast majority are for medical emergencies, which generally don’t pose much threat to firefighter life or limb.

And that crisis of public sector hiring? There have indeed been issues with police and medic hiring, but overall, the growth in public sector employment in California has far outpaced population (a 2.1% increase in residents between 2013 and 2023 — while state employment grew 11.4%, county employment grew 12.6%, city employment grew 13.2%, and special district employment grew 18.7%, according to data from the state controller).

Look, public safety folks do hard jobs. We are grateful. But they’re paid well for the risks they take, and their retirements are among the most generous in the land. This is a bit wonky, but stay with us:

Before Brown’s reforms, public safety workers could get 3% of salary for each year worked, as soon as they turned 50 (after 25 years of service, that’s 75% of pay for life).

After Brown’s reforms (known as the Public Employees’ Pension Reform Act of 2013, or PEPRA), public safety formulas were reduced, with 2.7% at 57 being popular (after 25 years of service, that’s 67.5% of pay for life).

McKinnor’s bill would allow agencies to reintroduce the dreaded 3% formula, but at age 55 rather than age 50.

Firefighters testified that they worry about doing demanding physical work at age 57, so lowering the age to 55 would be helpful.

By age 57, though, many firefighters have advanced into more managerial roles. And absolutely nothing is stopping them from retiring younger! They’d just have to settle for a bit less pension.

And public safety types get nice retirements. Our last spin through California Public Employees’ Retirement System data showed that, while the average pension for all retirees and their survivors/beneficiaries was about $38,000 a year, public safety types averaged $64,279. It was even higher for police and firefighters who worked for cities (as opposed to the state), averaging $75,125.

Granted, many of those folks retired under the more generous pre-PEPRA formulas. But even post-PEPRA, California’s retired public safety workers won’t be heading to the welfare office or applying for food stamps — one of the stated rationales behind McKinnor’s bill.

Naturally, the bill is passionately supported by California Professional Firefighters and Peace Officers Research Association of California, its co-sponsors, as well as firefighters from all over the state.

Opponents? The organizations that employ them and foot much of the bill, including the League of California Cities, California Special Districts Association and California State Association of Counties.

Protecting retirement?

“My son is currently in the fire academy. … Let me tell you, I bleed red and blue,” said Lisa Murphy, assistant city manager of Salinas. “I’m here to protect my son’s retirement, as well as of all the firefighters who were here earlier testifying.”

McKinnor’s bill threatens to reverse years of critical pension reforms designed to protect the long-term viability of retirement systems, she said. PEPRA was carefully planned “to stabilize a system on the brink of unsustainability,” largely due to the generous retirement enhancements granted during the 2000s. Returning to that benefit structure would severely compromise the future health of the pension systems — as well as the financial stability of the cities, counties and agencies that must pay into them.

“I commend the author’s intent … however, salary remains the most influential factor in choosing employment,” she said. Increased retirement costs would mean cities fill fewer jobs and struggle to offer competitive wages and health care benefits.

“More alarmingly, it could undermine the very retirement system our employees are counting on to be there in their future. Given the current economic uncertainty, this proposal is especially risky. PERS recently suffered a loss of $15 billion due to market volatility, costs that will inevitably be passed on to cities with shrinking revenues and increasing expenses. Now is not the time to increase the financial burden on local governments.”

Those sentiments were echoed by Bob Nelson, Santa Barbara County supervisor.

McKinnor’s bill “rolls back hard-won reform and reinstates benefit formulas we already know are unsustainable,” he said. “In the 1990s and 2000s, similar pension packages nearly bankrupted the state and many local municipalities. We don’t need to test them again. We’ve lived with the consequences.”

Since 2010, Santa Barbara County has paid over $100 million in additional payments annually to stabilize its retirement system. Those sacrifices brought the funded status of its pension system from 62% to 87% — but at real cost, including reductions to public safety staffing and fewer resources to address mental health, homelessness and criminal justice reform, he said.

Reminder: Public pension payments are guaranteed. If investment earnings don’t provide enough to cover them, California taxpayers must make up the difference.

“AB 1383 would boost pensions for safety employees without requiring sufficient funds to be set aside to meet those promises,” David Crane, a lecturer in public policy at Stanford University and president of Govern For California, said by email. “That is the same lethal combination that has already crushed CA governments.”

Los Angeles already spends 18% — $2 billion — of its budget on retirement costs, Crane wrote, and Gov. Gavin Newsom’s proposed budget shows the state spending $18 billion on the same in 2026 — twice what it spent a decade ago, and 10 times more than in 2000.

Aye

But pesky stats like that did not enter the conversation, much less sway the enthusiastic, bipartisan and unanimous support for the bill. Committee members jumped to sign on as co-authors.

“It’s not dollars to me,” said Tom Lackey, R-Palmdale. “It’s bodies. It’s people.”

Juan Alanis, R-Modesto, mused that the bill might give his son — in law enforcement under PEPRA — two years of his life back.

Stephanie Nguyen, D-Elk Grove, marveled as she recounted her recent attempt to maneuver through an obstacle course firefighters had set up to demonstrate their demanding training. “I can’t believe we allow our firefighters to do this ’til the age of 57,” she said. “They need to be protected.”

Tasha Boerner, D-Carlsbad, agreed. “We need to get this done,” she said. “We can’t expect people to physically work themselves into the grave.”

The bill heads to the appropriations committee. Here we go again.