State, Local Officials Consider Cutting Gov’t Retiree Health Care

State leaders and local government officials are targeting government retiree health care benefits for cuts, Capitol Weekly reports.

Details of State Government Retiree Health Care Costs

In February, state actuaries estimated that the cost of providing retiree health care benefits for current state government workers and retirees would be $60 billion over the next 30 years.

Gov. Jerry Brown's (D) 12-point pension reform plan said that health care costs for state government retirees increased by 60% in five years and will nearly double over 10 years.

The state's general fund is expected to spend about $1.7 billion this year on state government retiree health care benefits.

Brown's pension reform plan -- which is presumably still under consideration by the Legislature -- states that it would "change the anomaly of retires paying less for health care premiums than current employees."

Details of Local Government Retiree Health Care Costs

Certain California cities that have filed for bankruptcy have targeted local government retiree health care benefits for cuts.

The cities that have reduced health care payments for local government retirees include:

• San Bernardino, which cited $2.2 million in savings from a deferred city retiree health care payment;
• Stockton, which seeks to end all city government retiree health care payments; and
• Vallejo, which reduced monthly city government retiree health care payments to $300 from as much as $1,500 (Mendel, Capitol Weekly, 8/6).