Titled Proposition C and Proposition D, the plans were designed to trim the city’s pension costs, which are supposedly taking up more than their fair share of the city’s budget. According to the Chronicle, the city is currently paying $422 million in pension costs, a number that is expected to nearly double by 2014, and does not include the $4.6 billion in health care costs for current and retired workers.
Proposition C, which was backed by Mayor Lee, unions, and most of the city’s political leaders, will save the city an estimated $1.3 billion over the next decade. The plan will do this by requiring city workers to contribute 7.5% of their salaries to the pension fund, a percentage that would rise in bad economic times and fall when the city and its pension plan was flush.
Proposition D, which was backed by Public Defender Jeff Adachi, would have set a minimum contribution of 7.5% of city workers’ salaries, a number that could have jumped as high as 16% for the highest-paid city workers when financial times were bad. Adachi’s plan would have saved the city an estimated $1.6 billion over the next 10 years.The biggest difference between the two plans, though, is how they were created. Prop. D was the creation of Adachi and his advisers, and would have required higher pension contributions from police officers and firefighters, whose pensions cost the city far more than those of other city workers. Adachi collected more than 48,000 valid signatures to get his pension initiative on the ballot.
Lee's measure, on the other hand, was crafted during long negotiations between the city and its unions, with the help of businessman Warren Hellman. The unions have put up most of the more than $1.5 million raised in support of Prop. C.