Thirteen years ago, California radically reformed its public employee pension systems under then-Governor Jerry Brown amidst a financial crisis that threatened state stability. The reforms, despite immense opposition from powerful public employee unions, introduced significant changes: capping benefits, increasing retirement ages, and instituting a two-tier system for current and future employees. This overhaul aimed to alleviate the unsustainable pension obligations that had previously led to the financial downfall of several cities, reducing projected costs significantly. The measures faced legal challenges but successfully withstand scrutiny in the state Supreme Court, marking a historic shift in fiscal responsibility for pension costs.
The legislation capped benefits, increased retirement ages, and required workers to pay for at least half of pension costs, marking a significant restructuring of pension systems.
This is the biggest rollback to public pension benefits in the history of California pensions, according to Governor Brown, aiming to reduce costs by up to $55 billion.
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