pages: CityCouncil/2011-03-29.pdf, 12
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CityCouncil | 2011-03-29 | 12 | Councilmember Johnson requested the City Treasurer to explain his statements about San Jose and Oakland. The City Treasurer stated San Jose is looking at 10% pay cuts; Oakland laid off officers, which ended up in negotiations and officers are sharing PERS costs; there are blue prints out there; the Acting City Manager could gather up sample data points; the problem is not unique; the City is not alone in the problem, but is alone in not addressing the problem; the City is on the Vallejo trajectory [bankruptcy]; Vallejo's public safety was 75% of its budget; the City is past the red zone. Councilmember Johnson stated current employees and retirees should have the most interest that the City is on a sustainable course; PERS expenses continue to go up and police and fire has to be cut to make PERS payments; cities start defaulting on PERS and OPEB payments if the price gets so high that services cannot be cut enough to pay for retiree expenses. Mayor Gilmore stated in many cases retirees have better benefits than employees working today; the people working today are supporting the retires; in the trajectory of the system, tomorrow's workers will not be there to support the current generation of active employees; if not changed, the active employees will not be collecting anything. Councilmember Johnson stated there are current employees under Oakland's old retirement system and Oakland is threatening not to pay; retirees should not feel secure. The City Treasurer stated in the Vallejo case, retiree medical benefits were reduced by 75%; the City has medical obligations it cannot pay. Councilmember Johnson stated government might have to decide between having current employees and providing services versus paying obligations for retirees. The City Treasurer stated the City could reach the point where the Courts decide what will be provided if something is not done; something has to be done immediately; that he is available to support the Council and review information. The City Auditor addressed the Council. Mayor Gilmore stated the City Council does not believe the City will get out of the mess by simply raising revenue; it is clear that the City has to make cuts and restructuring has to be done; restructuring does not do any good on day 1, but may do some good in 15 to 20 years; the City has to come up with long terms solutions for its pension and OPEB; here and now type of savings are also needed; one way to achieve present savings is tell people to take a cut across the board; another option is layoffs, which impact service to the public; response times being twice as long due to public safety layoffs could be a new reality; the Council has to communicate said things to the public; Special Meeting Alameda City Council 12 March 29, 2011 | CityCouncil/2011-03-29.pdf |