Nineteen local business and civic leaders on Wednesday delivered a letter to L.A. City Hall urging the city council to pass Mayor Antonio Villaraigosa’s pension reform proposal.
The letter issues a blunt warning that escalating pension obligations will damage the city’s fiscal stability and cripple its ability to provide essential public services and invest in infrastructure improvements.
Villaraigosa’s pension reform plan calls for raising the retirement age to 65 from 55 for future city workers and requiring future employees to contribute more toward their retirement. The plan would save the city up to $70 million a year.
“This is clearly an important step in getting the city’s fiscal house in order so that it can provide … better services over time,” the letter states. “The longer we wait, the worse the problem will get.”
The group of 19 includes: attorney and Los Angeles County Business Federation founder David Fleming; City National Bank Chief Executive Russell Goldsmith; Los Angeles Area Chamber of Commerce Chief Executive Gary Toebben; attorney and former Los Angeles Area Chamber of Commerce board chairman George Kieffer; Majestic Realty Vice President John Semcken; Cedars-Sinai Chief Executive Thomas Priselac; Business Journal Publisher Matthew Toledo and United Way of Greater Los Angeles Chief Executive Elise Buik.
Separately, former Mayor Richard Riordan is spearheading an effort to put a more drastic pension reform proposal before voters; it would put future employees in a 401 (k)-style defined contribution pension plan and freeze automatic increases in pension payouts if the pension funds’ investments underperform.