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Latest News - October 2010

October 27, 2010
Union Opposition Quashes Councilman’s Proposal on DWP Pension
Source: Los Angeles Times
By: David Zahniser

The Los Angeles City Council scuttled a plan to seek power over the Los Angeles Department of Water and Power's retirement benefits Tuesday after hundreds of the utility's workers showed up to denounce the move.

Councilman Bernard C. Parks had called for a March 8 ballot measure that would ask voters to give the council more authority over the DWP's retirement system, which operates independently from the rest of the city.

Councilman Paul Koretz panned that idea, saying he did not want to engage in a costly election-year fight with the powerful International Brotherhood of Electrical Workers Local 18, which represents DWP employees and had hundreds of members in the audience.

"This is as pointless a thing as I've seen on an agenda," said Koretz, who was elected in 2009 after the union — and one of its fellow locals — spent nearly $40,000 on his behalf.

Brian D'Arcy, the head of the DWP employee union, said Parks' plan never should have reached the council floor, arguing that it circumvented the public notice provision of the state's open meetings law and was the result of a "dysfunctional" process.

"They're not moving our pension [system] under council control," he said. "They did a pretty remarkable job of screwing the other two up."

Costs of the city's other two retirement systems — one for public-safety employees and the other for non-DWP civilian workers — are rising so quickly that they could consume nearly one-third of the city's general fund budget by 2015 unless major changes are made.

Worried about those costs, the council voted to draft a separate ballot measure. If approved, it would pare back retirement benefits for newly hired police officers and firefighters.

The DWP union offered a huge show of force in response to Parks' proposal, lining much of Main Street along City Hall with protesters. Hundreds of others went into the council chamber to cheer those who agreed with the union and jeer those who didn't.

Parks withdrew his DWP ballot proposal after his colleagues denounced the plan. But he said the measure was designed to give the council the ability to reduce the size of benefits for newly hired DWP workers — not manage the pension system's day-to-day affairs.

Parks said the DWP's pension system has suffered double-digit losses in the wake of the recession while providing benefits that are more generous than those provided to other civilian employees. "This pension system is in no better shape than the other two, and if we take no further action, it will be unsustainable," he said.

Under the retirement formula provided by pension officials, a DWP employee who retires after 30 years with a salary of $100,000 will receive a $69,000 annual pension. The Times reported last year that Parks, a former police chief, receives a $22,000-per-month pension even as he earns nearly $179,000 annually as a council member.

The council and the DWP's pension board have been at odds in recent weeks over the 1,600 civilian employees who have transferred to the utility from other city departments. Those transfers were part of a larger effort to keep city workers from losing their jobs in departments hit hard by the budget crisis.

Worried about the cost of those transfers, DWP officials moved to suspend full retirement benefits for any new worker who comes to the utility from another city agency. The council vetoed that measure two weeks ago, setting the stage for more quarrels in the coming weeks.

 

 


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