California Professional Firefighters

Governor's Pension Proposal Puts Retirement Security at Risk

Governor Jerry Brown has released a 12-point “pension reform plan” that calls for higher retirement age, shifts substantial costs to workers, imposes a risky “hybrid” plan for new employees and could upend hundreds of local bargaining agreements.

Unveiled at a Capitol news conference, the governor's plan:

  • Increases the non-safety retirement age from 55 to 67
  • Imposes a "hybrid" system for new workers -- part pension, part 401k-style
  • Mandates a 50-50 employer-employee split of pension costs
  • Adds three governor's appointments to the PERS Board
  • Proposes a range of smaller changes aimed at spiking, state employee health costs

Click HERE to read details of the governor's plan.

As unveiled, the proposal threatens to have a profound impact on retirement security for current and future firefighters in California. Below is a breakdown of the impact on current and future employees.

ALL EMPLOYEES (Existing and New)

  • Pension cost shift: Employee contribution of at least 50 percent of normal cost of benefits
  • 960 hour rule: Eliminates ability of CalPERS contracting employers to request that a retired annuitant be extended beyond the 960 hour limit in any fiscal year.
  • Service restrictions: Prohibits all retired employees who serve on public boards and commissions from earning any retirement benefits for that service.
  • Felons forfeit pensions: Requires a public official or employee to forfeit their pension and related benefits if they are convicted of a felony for acts associated with carrying out their official duties, seeking an elected office or appointment, or in connection with obtaining salary or pension benefits.
  • Retroactivity: Prohibits the retroactive application of pension benefit enhancements.
  • Pension holidays: Prohibits retirement contribution holidays (for employer and employee contributions)
  • Airtime: Eliminates “air time” (i.e. additional retirement service credit)


  • New hybrid plan: A plan that incorporates a reduced defined benefit along with a defined contribution component and Social Security. Proposal envisions a pension amount that equals 75% of an employee’s salary, in instances where a safety employee has 30 years of service (35 years of service for non-safety employees)
  • Increased minimum retirement age: For non-safety employees, the minimum retirement age will be set at the Social Security retirement age, which is currently age 67. The retirement age for new safety employees “will be less than 67,” according to the Governor’s proposal, but no specific age minimum for safety employees is provided in the plan.
  • Final compensation: Average would be defined as the highest average annual compensation over a three-year period, instead of single highest year.
  • Pensionable items: Defines compensation for retirement calculation purposes as the normal rate of base pay, excluding special bonuses, unplanned overtime, payouts for unused vacation or sick leave and “other pay perks.”


On the issue of health care, the Governor’s plan proposes 15 year and 25 year vesting periods for state employees only in order to be eligible for a partial and maximum employer health care contribution, respectively. While the Governor’s plan does not outline specifics local agency employee health care, his plan does encourage local governments to look to Medicare to the fullest extent possible when employees become eligible.