Costa Mesa has just found a solution for unsustainable pensions: firing 43% of city workers and outsourcing services.
Tuesday's move is part of a dramatic restructuring of a city that faces potentially skyrocketing pension costs in the coming years.
Costa Mesa's own projections show that in the next few years, it will be expected to pay more into the state's public pension fund, CalPERS. It's a situation being replayed up and down the state: When the CalPERS pension fund was flush in the early 2000s, Costa Mesa did not have to pay much to the state to cover its employees' retirement costs. Now that CalPERS investments are hurting, cities have to cover the difference.
That pattern looks to continue for at least the next five years, city officials project.
Laying off hundreds of employees and their accumulating pensions by the fall would help to balance the city's budget in years to come, council members reason.
Encinitas is a young city with few current retirees, and it is still underfunding its pensions and assuming awesome investment returns, so it hasn't felt the impact of its outrageous pension giveaway. The bill will come due for Encinitas in 10 or 20 years as it has in Costa Mesa already.
The current city council and the greedy unions are painting us into a corner. If they won't reform the pensions, the only solution will be to fire city workers and outsource everything.