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.;;gip• 'k o ■ j7 'a'f`v Oi-Spir PFS bft Pen an' larn A Look Back The future of public pension funds in California hung in the balance in early 2005. Cost to fund pensions were rising, and some lawmakers were eager to do something about it. The debate over public pensions began in December when Assemblyman Keith Richman introduced two pieces of legislation—a general session bill and special session bill. The bills, if passed, did virtually the same thing—put an initiative on the ballot that would require every State employee hired after July 1, 2007 to be in a defined contribution plan, and prohibit them from joining a defined benefit plan like CaIPERS. The quest for pension change gained steam when Governor Schwarzenegger announced his support of the pension proposals, and a statewide ballot initiative to create a defined contribution program for new employees and bar defined benefit plans was filed by the Howard Jarvis Tax Payers ,Association on January 5, 2005. In his State of the State address, Schwarzenegger called California's pension systems "another financial train on another track to disaster," saying that reforms were needed to ease the financial burden on the State, local employers and taxpayers - CaIPERS Response = In February, CaIPERS Board of Administration took an official position opposing Richman's legislation following testimony from the Director of the Department of Finance, and comments from numerous representatives of employee and retiree groups. The majority of CaIPERS Board believed the legislative proposals to move to a defined contribution plan could impact the retirement security of fixture members and impair our ability to invest assets appropriately. The proposals also didn't clearly provide for death and disability benefits for police officers, firefighters or any other members. In a turn of events, the Governor in April announced plans to delay pension reform contimred on page 2