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Fletcher unveils plan for non-union pensions

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Mayoral candidate Nathan Fletcher announced Monday his “CPR Plus” plan, a series of pension reforms for non-union city staff that builds on the Comprehensive Pension Reform initiative seeking voter approval in June.

His plan includes four pension reforms directed at the 720 employees of the mayor’s management team who aren’t represented by labor groups and account for $64 million in annual salaries.

Fletcher supports CPR and expects that primary voters will approve of the plan to switch most new city hires to 401(k)-style retirements. He says his additional pension reforms can be implemented at the onset of his administration — even if CPR was delayed by court challenges — and would allow city management to “lead by example” in the effort to reduce the city’s pension responsibilities.

“Today I’m releasing a plan that is easy to implement, will save the city millions of dollars and send a message of accountability,” Fletcher said.

CPR Plus would start by limiting the pensionable salaries of non-union city employees at $100,000.

Doing so would require a vote from the City Council. Fletcher said he expects the council to be receptive to capping the pensions of management-level employees in order to reinvest the savings in other city services.

“Under the Fletcher administration, six figure payouts for management will be a thing of the past,” he said.

He would need council approval for another aspect of his proposal, which would seek to combat overtime abuses. The current overtime rules for unrepresented management-level employees are more generous than required by the Fair Labor Standards Act and defy logic, Fletcher said. Changes to overtime compensation rules for unionized city employees would require negotiations, however.

In case CPR is delayed by labor negotiations or court challenges, his plan would call for CPR to be implemented immediately. He’d enroll management-level employees in a defined contribution plan — ideally an annuity, rather than a 401(k)-style plan — regardless of any delays in the CPR initiative.

The CPR Plus plan also finds an additional $6.4 million in annual savings by having Fletcher and all management-level employees accept a 10 percent pay cut along with a freeze of base compensation increases for five years.

“The problems with the San Diego pension system and its abuses are well-documented,” Fletcher said. “The worst examples of these abuses are often not from the rank-and-file city employees, but from the management level, the people making the highest salary. We can address this problem quickly and easily.”

Just before Fletcher’s press conference announcing CPR Plus, a staff member for City Councilmember Carl DeMaio, one of Fletcher’s opponents in the mayoral race and a champion of the CPR initiative, distributed literature attacking Fletcher for failing to vote against AB 1248.

The state bill, currently working its way through the state Senate, would require public employers to provide Social Security coverage to any employee not covered by a defined contribution plan.

Fletcher was present in chamber but didn’t register a vote for or against the bill.

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