Gov. Newsom's veto on bill affecting Ventura County pensions to lower payouts

Retirement pay for some county workers to fall as much as 10% without health benefit factored as compensation

Kathleen Wilson
Ventura County Star
Gov. Gavin Newsom speaks earlier this year.

In a decision that surprised county officials, Gov. Gavin Newsom last week vetoed a bill that would have restored certain pension benefits for an estimated 3,200 Ventura County public employees.

Assembly Bill 826 required that payments the county government made to the employees to buy health insurance count in the compensation used to calculate their pensions. To qualify, the county workers had to be hired before a state pension reform law took effect in 2013, be enrolled as of the date of an adverse California Supreme Court decision on July 30, 2020 and retire by Dec. 31, 2025. 

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Lower-paid employees may see their pensions fall by an average of 7% to 10% under previous estimates, Shawn Atin, the county's personnel chief, said Friday. 

Employees of the large Ventura County government have received a benefit called the "flex credit" since 1989 that they use to buy county-provided health insurance.

Then two years ago, legal counsel for the county pension board found a large portion of the benefit was an "in-kind," non-cash contribution that could not count for pensions based on the state Supreme Court's ruling on the constitutionality of the 2013 pension law.

Attorneys for the county and labor unions strongly objected to that interpretation but they have not received court relief and now the legislative solution has been blocked. Trustees for the pension system are due to discuss the governor's action Monday instead of implementing the reprieve.

Retirement Administrator Linda Webb said the pension system follows the law.

"Had the law changed, we would have changed with it," she said. "But it didn't as a result of the veto."

Kevin Aguayo, president of a union representing hundreds of Ventura County firefighters, said he was disappointed with the veto, but that it was not the end of the world. He said he did not know whether the effort was dead until he hears what the pension trustees say Monday.

Newsom said he sympathized with workers who may see lower pension checks than they expected, but found the bill would create an incentive to run afoul of the 2013 pension law, called the Public Employees' Pension Reform Act.

The governor said that the provisions of Assembly Bill 826, while narrower than previous versions, "attempt to circumvent recent court decisions, undermine the intent of the reform act and expose local governments to increased cost and litigation."

State Assemblywoman Jacqui Irwin, D-Thousand Oaks, authored the bill. She said in a statement that she was disappointed with the veto, calling the legislation a "narrow bill" that would have ensured workers received the pension benefits they paid for and were promised.

She said that contrary to the governor's statement, the bill explicitly complied with important pension reforms.

"This veto only increases the likelihood of expensive, unnecessary litigation, which is unfair to these employees and taxpayers," Irwin said after Newsom vetoed the bill Thursday.

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Kathleen Wilson covers the Ventura County government, including the county health system, politics and social services. Reach her at kathleen.wilson@vcstar.com or 805-437-0271.