Local Governments Watch Oregon Public Pension Debate
Oregon lawmakers are locked in a stalemate over whether to make additional cuts to the state's pension system for public employees.
The debate will affect every unit of government in Oregon. Most of the conversation at the capitol has surrounded the impact to state agencies and schools. But city and county governments are also watching the pension battle closely.
It's become a tradition in Salem. Each summer the city's Public Works Department rolls out its biggest equipment in a display meant to wow the kids. Bulldozers, snow plows and street sweepers line up around a riverfront park. In a time of tighter city budgets, the demonstration helps remind people of what their city government actually does for them.
Mike Garcia shows off the tools he uses to inspect clogged storm drains.
"What we're looking for is any defect in the pipes. Anything that's cracked, plugged," he says, as he displays an array of cameras on long poles, used to snake their way up drain pipes to find the source of the problem. They look pretty high tech. At least, to me.
"It's outdated now," Garcia says. "You look at the new technology now that they're using, we're behind. But you know, we're making it work."
With the current budget they have to. In cities like Salem, the public works department competes with police and fire for funding. Salem closed two fire stations last year to cope with a tightened budget.
City Councilor Brad Nanke says one of the chief factors driving the city to tighten its belt is the cost of funding pensions for its employees. Nanke wants state lawmakers to ease the financial burden on local governments.
"We need some meaningful reform from the legislature," Nanke says. "Our citizens deserve public safety and the services that they pay their taxes for, and the current system is not sustainable."
Funding pensions can add an additional 15 to 20 percent to the cost of any given employee in some Oregon cities and counties. Majority Democrats in the legislature already passed one set of cuts to the state's pension system, known as PERS. Republicans have been pushing for deeper cuts.
But House Speaker Tina Kotek has been firm that any additional pension cuts must be paired with tax increases.
"It has to be balanced," Kotek says. "It has to be a shared sacrifice, not on just retirees but looking at new revenue."
One reason Democrats are hesitant to go along with additional pension cuts: the near certainty that any cuts will be challenged in court. A coalition of public employee unions is promising to file a lawsuit on the measure already passed.
"From the unions' point of view, nothing they're talking about is constitutional," says Don Loving, of the Oregon chapter of the American Federation of State, County and Municipal Employees, or AFSCME. The union represents some 10,000 local government employees.
Loving says his workers, like other public employees, have made concessions over the years in the form of lower salaries so that they could have better pensions when they retired. He says public workers are becoming the pawn in someone else's struggle.
"Really, if people are honest, we're not having this PERS discussion over the need to reform PERS," Loving says. "We're having this PERS discussion over a need to bridge the budget gap."
Loving says AFSCME will join in a lawsuit against the cuts to public employee pensions that have already happened. And he says that lawsuit could be filed as soon as July first. [I'm Chris Lehman in Salem.]
On the Web: Oregon Public Employees Retirement System