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Prop B is the antidote to our City’s escalating City employee pension and benefits costs

October 7, 2010

by Jeff Adachi

Jeff Adachi is no public pretender. His vigorous defense of clients makes his office a model for the nation. A passionate opponent of gang injunctions, he cares for our young people to the extent of giving out thousands of backpacks and books to our children and sponsoring a dress-up ball with free formal wear for our teenagers every year.
Almost a year ago, I first learned of San Francisco’s escalating pension and health care costs. After experiencing years of deficits and budget cuts, I was curious as to why the City’s debt seemed to be growing, even though basic services were being cut. I met with various elected leaders in the hopes that we could find a solution to address this problem. I also met with residents who were concerned about this problem and what could be done. I didn’t know it then, but these early efforts started a movement to reform our public benefits system known now as Prop B, which the voters will decide on Nov. 2.

I had met with several members of the Civil Grand Jury who had authored a report entitled, “Pensions: Beyond Our Ability to Pay,” where they detailed how the City’s retiree pension liability had nearly tripled in the past five years. Even worse was the City’s growing health care liability, which had ballooned to $4 billion in unfunded health care costs for 26,000 City employees, 28,000 retirees and their 47,000 dependents. And these costs, according to the City Controller, would double in the next five years.

One year later, the pension and benefits tsunami continues to grow. We are spending nearly a billion dollars on pension and health care costs for our City’s employees. One out of every six dollars available to the City now goes solely to these costs. By this time next year, it will have grown another $50 million to $70 million.

The problem with pensions has grown so bad that the public employee union leaders opposing Prop B don’t even argue against the Prop B’s common-sense pension reforms. After all, an employee who pays 9-10 percent into their pension for a guaranteed lifetime pension upon retirement, which equals 75-90 percent of their last year’s income, is a deal that no one in the private sector would even dream of. In order to receive the pension that a public sector employee receives, private sector employees would have to save 65 percent of their paycheck.

Instead, opponents have focused on the health care component of Prop B, arguing that Prop B is “bad medicine” because it requires City employees to pay more for their health care.

But a close review of the facts shows that under Prop B, City employees will still receive health care premiums at rates unparalleled in the private sector.

Currently, most City employees do not contribute anything for their own healthcare. Taxpayers subsidize the entire cost: $2,890 to $5,560 per year for each employee.

Prop B would change this by requiring that an employee insured under the basic health plan pay just $96 a year ($8 a month) for their healthcare. Under Proposition B, City employees would still pay more than 22 times less than private sector employee, who, on average, pay $2,185 per year for their health insurance.

City employees with dependents currently pay $8 a month. Under Prop B, they would pay $2,988 per year. Private sector employees with dependents pay an average of $7,026 a year. And this does not include the 31 percent of San Franciscans who do not receive employer-paid health care and pay the entire cost themselves.

Opponents of Prop B claim that City workers cannot afford to pay the health benefits if Prop B passes. Their argument ignores the fact that the average San Francisco City employee earns $93,000 a year in salary alone, not including benefits, while the average private sector salary is $46,000.

They also argue that “a single mother will be forced to pay up to $5,600 per year for her child’s health care — in addition to the $8,154 she already pays.”

First, this is not true. A City employee with two dependents only pays a total of $448 a month for full health coverage. Only if the City employee chose the most expensive health plan, which costs $31,645, would the employee have to pay $19,561 a year under Prop B instead of the $16,922, which he or she now pays.

What the opponents conveniently fail to point out is that out of 26,000 City employees, there are only 91 employees who are enrolled in this “Rolls Royce” rate plan.

Even with contributions required by Prop B, City employees will receive a benefit package that is unparalleled in the private sector. More importantly, however, the City’s healthcare fund will be made more sustainable by ensuring that the funding for the City’s healthcare program doesn’t run dry when the City can no longer afford to pay these costs.

According to the Controller’s ballot statement, Proposition B would save the City $121 million annually. Some of these funds could be used to prevent the devastating cuts to the City’s mental health, substance abuse and other community health programs for poverty-stricken adults and children who do not have healthcare coverage. Next year’s deficit looks worse, and we won’t be able to count on federal stimulus funding to save us.

Voting Yes on Prop B is an antidote to continuing cuts to healthcare for the poorest San Franciscans.

Jeff Adachi is the proponent of Proposition B and the City’s Public Defender. He can be reached at (415) 553-9520 or mailtoLjeff.adachi@sfgov.org.

10 thoughts on “Prop B is the antidote to our City’s escalating City employee pension and benefits costs

  1. bwing

    Anti Family measure!!!! driving more and more familites out of SF. Me Adachi you cannot guarantee that is where the money will go, that is NOT how the budget works and you know it. What about all the families that will be forced to drop their dependant insurance because it will go up several hundred dolllars a month? As it will under Kaiser (the very cheapest plan) That isnt much to you but for a family living paycheck to paycheck that is everything. Also, are you going to start paying into this or are you exempt as all of your other fat cat management and PD office cronies? Cadillac benefits? Two common HMO's? Blue shield and Kaiser HMO's with reapidly escalating co pays and prescription costs are far from luxury benefits. They offer far better health benefits in the private sector if you work for a company with as many employees as SF.

    Reply
  2. SFlocal

    By supporting Prop B Jeff Adachi has sold out the people he is supposed to be protecting. Prop B is a healthcare cut for working families and will force children to lose their healthcare coverage. It's going to double the cost of healthcare for single monthers, janitors, nurses, and school teachers.

    How can a man who is supposed to protect the public put such a measure on the ballot. A judge called Prop B one of the most draconian measures he had even seen and ruled that it violated the first amendment rights of San Francisco Citizens. Why is our public defender putting measures on the ballot that violate our rights? VOTE NO ON PROP B!

    Reply
    1. I don't make $93K

      Get real SFlocal, Jeff Adachi doesn't protect children and working families. Jeff Adachi defends people that's sitting in jail or out on bail awaiting for Jeff Adachi to get them off the hook…remember SFlocal, Adachi only protects people from going to jail…Adachi likes to steal from the poor and give to the rich…

      Reply
  3. Humans

    Jeff Adachi, what is your real motivation? Some side deal with Sequoia Capital once you become Mayor? What's the real payoff to you? What kind of human are you to sacrifice the healthcare of children and livelihood of hard working families? What would really motivate you to work so hard, pay off so many petition gatherers (with petitions disguised as 'pension reform' without emphasizing the real healthcare hit) to get something like this on the ballot in the first place?

    Reply
    1. I don't make $93K

      No Humans, get real…No side deals with Sequoia Capital!!! This is the plan: Meg Whitman (Nutmeg) = Governor. Jeff Adachi (take money from poor to help the rich) = Mayor = General Funds to Michael Moritz and Richard Beleson and the other Sequoia Capital investors (you know who you are) = General Funds (children and city employees' health care) = On-Going Profit for $245,000.00 for MM and Profit for $100,000.00 RB…Humans, would you like me to provide the names for the rest of the gang?

      Vote "NO" on Proposition B…

      Reply
  4. Algernon Moncrief

    CLAWING BACK DEFERRED PAY: THE COLORADO GUIDE

    Obviously, legislators around the country are not quite as sophisticated as their counterparts in Colorado. It has never occurred to them that they could just pass a bill stating “Oh, by the way, we are no longer bound by our contractual pension obligations.”

    Under the Colorado pension “contract breachin’ plan”. . . . . you simply seize vested, accrued, earned, contracted benefits from retirees and pension members (incredibly, with the help of your local union lobbyists . . . . toss those retired union brothers under the bus) until your unfunded pension liabilities are sufficiently reduced to raise your funded ratio.

    Meeting contractual obligations? Performing your fiduciary duty? Acting in a moral fashion? No need to fret about these things. We’ve looked into it in Colorado and dang if these things haven’t been optional all along. Hello state and local governments . . . round up those rascally debt problems and herd ‘em out west to us in Colorado, we’ll fix ‘em right good fer ya!
    (Visit saveperacola.com for more info.)

    Reply
    1. SFlocal

      I used to live in Colorado and the government is in even worse shape there than in California. The only guide Colorado can offer is a how to on getting ride of critical government services. Anyone who has lived in Colorado knows what you are saying is big a joke!

      Reply
  5. Steven Provost

    As a practical, Honest, & reasonable civic example city managers who have recently been hired need to
    start paying in to the new pension & health care structure. City Managers and administrators need to
    become "The Total Package Example"; honestly, for the budget that's said won't pay pensions in the future, reasonably, for human decency aspects: people with children have more in common not less because of a job position, and non management workers are not harvesting crops for the "King on the hill". Before the vote, let's see the managers make the first move to put the City in the black; not a black eye to team players!

    Reply
  6. I don't make 93k either...

    Thank you for that link!! Help hard working SF employees protect their families health. NO ON B!!

    Reply

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