In San Diego: Employees vote; taxpayers don’t

Tony Manolatos Tony Manolatos 2 Comments

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Starting today, an important election involving city finances is taking place in San Diego, but taxpayers won’t be casting the votes.

Nope, this election rests with city employees, who have a week to vote on whether to eliminate a controversial and costly employee benefit – the Deferred Retirement Option Plan (DROP). 

Yes, in San Diego, employees have the final say when it comes to eliminating their own retirement benefits. Most taxpayers probably have no idea this practice exists, but it’s alive and well – and guaranteed under the City’s Charter.

Specifically, Charter Section 143.1 says:

“No ordinance amending the retirement system which affects the benefits of any employee under such retirement system shall be adopted without the approval of a majority vote of the members of said system.”

Does anyone think employees will vote to do away with DROP, or any other retirement benefit?

That’s like asking a first-grade class to vote on whether to replace ice cream with carrots at snack time.  

DROP, by the way, allows participants to simultaneously collect a pension and a salary, costing the city millions of dollars.

Voters can eliminate Charter Section 143.1. Given the chance, I’m sure most would gladly vote to scrap 143.1.

I am sure very few San Diegans enjoy similar veto power with regard to changes to their retirement benefits. At most businesses, employees usually find out in writing that 401(k) matches and pensions are being eliminated or reduced. No questions asked, and surely no vote to halt the change.

At the City, the employee DROP election closes March 30th at midnight. I am sure it won’t be a nail biter.

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Comments 2

  1. Assuming they don’t eliminate DROP then what? It seems the council and taxpayers are working for the unions rather than the other way around. How does management take control?

  2. Tony,

    I am quite certain that you know what a legally vested benefit is and the reason why employees get to vote on defined benefits while they don’t get to vote on 401-K’s; at least, I surely hope you do.

    I am also confident that you are aware that the study the City did on DROP showed that its net cost to the City was in the margin of error for the study – not exactly “a costly benefit.”

    Your boss is better, much better, than this post. This is something I would expect from his colleague in District 5.

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