S.D. Council Moves To Further Limit DROP Enrollment
Tuesday, June 15, 2010
SAN DIEGO The City Council voted today to shut off a contested retirement perk granted to some city employees, but consensus by a majority of members of the San Diego City Employees' Retirement System is required before the change could take effect.
The Deferred Retirement Option Program, or DROP, allows eligible retirement-age municipal employees to continue to work for the city and collect a paycheck for five years, while monthly pension payments are funneled into an investment account.
Critics argue DROP amounts to double-dipping, as participants are collecting their pension and a salary at the same time.
DROP was eliminated for new hires in 2005. The City Council's unanimous vote today would essentially close the benefit for everybody else who hasn't already moved to access it.
However, according to the City Attorney's Office, San Diego's charter mandates that a majority of members of the municipal pension system -- the same people that benefit from DROP -- must also vote before it can be eliminated. The change would also require a second reading of the City Council.
SDCERS has indicated the vote by its members will take about three months.
Councilman Carl DeMaio, a vocal advocate for pension reform, said the charter provision puts the City Council at a disadvantage and needs to be changed.
"We have, in effect, provided a veto to the employee unions on the employer's rights under California state labor law," DeMaio said. "No other large city does it this way. I think it puts this City Council and the mayor and future city councils and mayors at a disadvantage to exercise their rights as employers."
City Council President Ben Hueso was absent from today's meeting.