Congressman Bob Filner is the only one of the four major mayoral candidates who does not support Proposition B. That would eliminate city pensions for most new hires and replace them with a 401(k).
But until this weekend Filner had not put his own plan down on paper. It calls for capping pensions at under six figures, putting half of any projected surplus toward the pension debt and looking into taking out bonds to pay the debt down sooner.
“We can, in fact, refinance our debt at a much lower interest rate and put $500 million into the general fund over the next 10 years,” he said. “(That) can fix potholes, keep libraries and rec centers open, hire new police officers and do things we haven’t been able to do as a city without new taxes.”
Filner said the County of San Diego has used this method three different times with its pension system. He projects the city could save $753 million over 15 years.
But Councilman and mayoral candidate Carl DeMaio said Filner’s plan amounts to paying off one credit card with another. He said it continues bad financial practices from the past.
“Instead of reforming the benefits in the pension system, they went deeper into debt. They kicked the can down the road. And this proposal continues that tradition,” he said.
DeMaio is leading the charge to pass the 401(k) initiative.
District Attorney and mayoral candidate Bonnie Dunamis also slammed Filner’s plan. In a statement she wrote:
"Bob Filner continues to kick his rusty pension can down our crumbling roads. Debt for future generations is not a solution to our pension problems. Voters clearly want real pension reform and they want it now. Mr. Filner continues to fail to provide the leadership San Diego needs to put our financial problems behind us."
But Filner said the interest rate on the pension debt is projected to be about 7.5 percent. He estimates the city could take out a bond to pay off some of that debt at 6 percent interest or less, which he says would save millions of dollars over time.
