SACRAMENTO, Calif. - A California state Senate committee effectively killed for now a bill that would have allowed municipalities to offer employees a choice between defined benefit and defined contribution plans.
But the issue is not dead.
Observers said it is significant the three Democrats on the Senate Public Employment and Retirement Committee July 1 abstained on a vote on the Republican-sponsored bill, rather than rejecting it outright. The two Republican members voted to support the bill. In a separate vote, committee members voted 4-0 to recommend further discussion on the issue.
A joint Assembly-Senate committee will conduct a public hearing in the fall on the question of alternative defined contribution plans for employees of municipalities now participating in the $100 billion defined benefit plan of the California Public Employees' and the $65 billion California State Teachers' retirement systems. Public safety personnel, including fire and police officers, were not covered by the bill.
Democratic Sen. James Costa, whose support was considered by many as critical to the success of the bill, reportedly said at the committee hearing that while he was tentatively in support of the concept, he could not support this particular version of the legislation.
"We consider this a major success. We knew going into the hearing that we would not see the bill passed out of committee, because we met with Sen. Costa ahead of time and he said he could not back this bill. But the senators did not kill the issue. They will discuss it much further in joint sessions with the Assembly," said Michael D'Arelli, the pension consultant for the Assembly and an aid to Republican Assemblyman Howard Kaloogian, the bill's sponsor.
Officials from both of the giant state funds were at the committee meeting. Labor representatives were extremely well-represented and vocal in their opposition to the bill, AB 3252.