By Shawn Nelson, Chairman of the Orange County Board of Supervisors
When I took office in 2010, I advocated for reducing costs to the taxpayers. Arguably, the bloated public employee retirement formulas represent the largest unnecessary expenditure at the County. In response, the Board of Supervisors has supported and implemented several measures to rein in pension costs since then. This Tuesday, November 5, the Board will vote on two additional items: whether to immediately eliminate County pick-ups of required pension contributions for members of the Board of Supervisors and whether to place on the June ballot a measure that eliminates County pick-ups of required pension contributions for all County of Orange elected officials assuming office on or after January 1, 2015.
Below are some of the previous major accomplishments:
- June 5, 2012: Measure B approved by Orange County voters with 72.4% votes, which requires future County Supervisors to enroll in the least expensive pension plan available.
- December 18, 2012: Board approved to adopt 1.62% @ 65 retirement benefits formula for all employees hired on or after 1/1/13.
- December 18, 2012: Board approved to adopt 2011-2014 Memorandum of Understanding (MOU) with Orange County Managers Association (OCMA), which requires all managers to pay for their share of the normal cost of pension and reverse pick-ups associated with 2.7@55.
- March 5, 2013: Board adopted a resolution & unilaterally imposed terms and conditions of employment for Orange County Attorney’s Association (OCAA), which requires all attorneys to pay for their share of the normal cost of pension and reverse pick-ups associated with 2.7@55.
- February 7, 2012 to May 7, 2013: Board appointed Clerk of the Board (2/7/2012), Office of Performance Audit Director (3/19/2013), Clerk-Recorder (4/2/2013), Auditor-Controller (4/16/2013) and County Executive Officer (5/7/2013) positions and required them to pay for their share of the normal cost of pension and reverse pick-ups associated with 2.7@55.
- January 15, 2013 through April 9, 2013: Board approved agreements with various labor groups requiring all employees hired on or after January 1, 2013, to pay for past service liability associated with the 2.7@55 retirement formula provided to certain County employees and commonly referred to as the “Reverse Pick-up” (OCEA 2/5/13, OCMA 4/9/13, AOCW 1/15/13).
- May 21, 2013: Board revised the Personnel and Salary Resolution to eliminate County pick-ups of required pension contributions for Executive Management, Executive Aides and Executive Assistants, effective 6/28/13; and members of the Board of Supervisors and other Elected County Officials who are elected, appointed or re-elected to a term on or after 1/1/15.
- In addition, action taken by the Orange County Employees Retirement System (OCERS) Board resulted in the County and other plan participants making larger contributions to the retirement system by amortizing future Unfunded Actuarial Accrued Liability (UAAL) over a shorter amortization period (from 30 years to 25 years). OCERS also reduced investment earning assumptions from 7.75% to 7.25%.