San Diego leaders offer unions mediated negotiations on pension - CBS News 8 - San Diego, CA News Station - KFMB Channel 8

San Diego leaders offer unions mediated negotiations on pension reform

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SAN DIEGO (CNS) - San Diego city leaders on Friday offered to meet with municipal employee unions to settle most outstanding legal issues, including 10 current lawsuits, over the debt-ridden pension system.

The offer came with the consent of Mayor Jerry Sanders, City Attorney Jan Goldsmith and the City Council.

"This is a key opportunity," Goldsmith said at a news conference. "Litigation is an uncertainty. It's bad for employer-employee morale."

The negotiations would focus on four areas:

- a proposal to freeze base employee compensation for an agreed-upon length of time, in order to stabilize the amount of money the city pays into the pension system. The city would still be allowed to add bonuses and pay-for-performance packages to attract the best employees;

- the definition of the City Charter's demand for "substantially equal" retirement contributions between the city and worker, long disputed between the two sides. A hearing on a lawsuit on the subject is set for April, Goldsmith said;

- an agreement to end all but a few lawsuits; and

- creation of a 401(k) plan for newly hired workers.

Goldsmith said he hopes to hear back from the unions by the end of the month on whether they care to participate in the negotiations, which would be handled by a mediator.

City Councilman Kevin Faulconer called the push by Goldsmith "a huge step."

"We need to end the pension wars - the divisiveness and the lawsuits," Faulconer said.

He said a financially sound city is in the best interest of employees.

Council colleague Carl DeMaio, an early proponent of freezing base pay, said the ball is now in the court of the unions.

"If they do not want to join us in this compromise package, we stand ready to take reform to the ballot box for a public vote," DeMaio said.

The San Diego City Employees Retirement System has a deficit of $2.1 billion, a major factor in the city's overall budget shortfall. Underfunding of the retirement system led to a large amount of lawsuits between the city, SDCERS and employee unions.

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