State & Local Government Policy, Business and Technology

California promised public employees generous retirements. Will the courts give government a way out?

Los Angeles Times: California’s generous public employee pensions, shielded for decades by the state’s courts, may soon no longer be sacrosanct.

In a potentially huge win for advocates of cutting government pensions, an appeals court in August declared that public retirement plans were not “immutable” and could be reduced. The three-judge panel said the law merely requires government to provide a “reasonable” pension.
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That unanimous ruling, now before the California Supreme Court, could be a vehicle for reducing a shortfall amounting to hundreds of billions of dollars in state and local pension systems. If upheld, the decision could lead to the kinds of cutbacks previous courts blocked.

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