A big battle is brewing over a proposed ballot initiative that would roll back pension benefits for newly hired government employees in California.
The California Foundation for Fiscal Responsibility has recently filed the measure with the state attorney general's office.
And union bosses are promising to fight it.
Proponents of pension reform say their ballot measure, if passed, would save California taxpayers $1 billion in its first year and $500 billion over the next three decades.
"The status quo means that as time goes by, pension costs will continue to take more and more money from everybody's budgets," said Jack Dean with The California Foundation for Fiscal Responsibility.
Among other things, the measure would extend retirement ages for state and local government employees.
It would be age 58 for peace officers and firefighters, 60 for other public safety employees and age 65 for all other government employees.
Retirement pay would be capped at 75 percent of an employee's annual base wage.
The initiative would change the pension formula for newly hired peace officers and firefighters from 3 at 50 to 2.3 at 58.
For other public safety employees would go from 2.5 percent at age 55 to 1.8 percent at age 60.
Critics say California's huge public employees retirement system is unsustainable and in deep financial trouble, losing tens of billions of dollars in investments.
"It's unaffordable and unfair to the taxpayers because themoney that's required to pay for the promises made by elected officials at the behest of public employee unions, it's taken funding away from the vital services the taxpayers need and deserve," said Bakersfield City Councilman Zack Scrivner.
Advocates for overhauling the system say lucrative pension plans could potentially bankrupt local governments, which are obligated to make up any losses to the pension system with additional tax dollars.
"Since the pensions were increased in 2002-2003, our pension costs went from about four million a year to 25 million. And the overall liability went from a $90 million surplus to a $100 million unfunded liability," added Scrivner.
Public employee unions are promising to fight the measure tooth and nail.
"Pensions are a minute portion of the state's overall budget problems, and rolling back benefits doesn't address the bigger budget problem, but instead of addressing that, they're going after the pensions of California workers," said Derek Robinson with the Kern County Firefighters Local 1301.
The foundation estimates it will take about $2 million to get one million signatures to qualify the measure for the November, 2010 ballot.
