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Increased pensions expected to wallop state, local budgets ``CalPERS' investment returns provide this historic opportunity to restore equity among our active members and retirees, without causing any additional taxpayer burden,'' Crist, who recently left the board, said at the time. Sen. Deborah Ortiz, a Democrat from Sacramento, then chair of the Senate's Public Employment and Retirement Committee, sponsored the bill at the request of CalPERS and the Davis administration. Ortiz said she was skeptical even after agreeing to carry the legislation. ``But we probed and probed and asked questions 100 times,'' she said. ``The CalPERS staff assured us that even in the worst-case scenario the state's general fund would take a $300 million hit'' annually. The latest CalPERS projections are that it will need more than $3 billion from taxpayers next year to cover retirement benefits because the stock market crashed and burned three years in a row. ``We made the same mistake as millions of private investors around the United States,'' assuming the stock market would remain strong, Ortiz said. Darin Hall, a spokesman for CalPERS, and Ross Lopez, a spokesman for Davis, agreed. ``Nobody could have guessed several years ago we could have been in this position'' -- in regard to retirement costs or the budget in general, Lopez said. State agencies such as the California Highway Patrol, Department of Corrections and the California Department of Forestry and Fire Protection got the enhanced benefits first. ``Then it turned into a mad rush,'' as cities and counties, including nearly all in the Bay Area, began negotiating contracts that allowed police and firefighters to retire at up to 90 percent of their salary to keep them from fleeing to state agencies, Hall said. Conservative Sen. Tom McClintock, R-Thousand Oaks, said the CalPERS board and cities and counties that went along with them should have known better. ``The bill was ludicrous on its face,'' he said. ``I can't think of a faster way to undermine the integrity of the retirement system than by paying someone 90 percent of their highest salary and setting the retirement age at 50.'' The Ortiz bill, SB 400, cleared the Senate 39-0. McClintock, then an assemblyman, was one of only seven of 80 Assembly members who voted against it. It was followed by other retirement-enhancement bills. Even today, Sen. Joe Dunn, D-Garden Grove, is sponsoring a bill, SB 100, that would raise the amount police and firefighters can receive after they retire to 100 percent of their salary. CalPERS says the change could actually save money because many public safety personnel will work longer to reach the 100 percent benchmark. ``What are these people smoking for breakfast?'' asked Coupal, of the taxpayer's association. Perry, the lobbyist for the statewide police association, said his members are sympathetic to the plight of state and local governments. But he said city and county officials should have been putting away money for a rainy day when CalPERS required them to pay little or nothing. Sunnyvale City Manager Bob LaSala hopes relief will come as the economy improves, the stock market rises and CalPERS rates start dropping. But like most city and county officials, he's not willing to make predictions. ``If I had a crystal ball, I'd probably be able to retire,'' LaSala quipped.
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Contact Ken McLaughlin at kmclaughlin@mercurynews.com or (831) 423-3115.
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