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In the coming weeks, the SF Board of Supervisors Rules Committee will be hearing the "consensus" proposal for pension reform, which Mayor Ed Lee and a coalition of the city’s labor unions released May 24. The board has until July to make amendments and vote on the proposal.

The proposal, which projects savings of $1 billion over ten years, would:

• Require that city employees pay more for their benefits, rather than reducing benefits. Employee contributions to the pension fund would increase as the city’s contributions increase. Employees earning less than $50,000 per year would be exempted.   
• Increase the retirement ages for new employees from 62 to 65 for most employees and from 55 to 58 for public safety employees.
• For new employees, calculate pensions based on the average of the last three years of service (instead of the last two years, as is the current practice).
• Amend the composition of the Health Services Board to give the city more influence over employee health benefits and costs.
• Require existing employees to contribute to the Retiree Health Care Trust fund starting in 2016.

We congratulate the mayor on navigating an extremely difficult political process to achieve some level of consensus. But a number of questions still remain. It’s no secret that the city’s pension spending has exploded in recent years, but less well known is how it will increase in the coming years. The city controller projects that the pension burden will grow by an average of approximately $100 million per year in the next five years to somewhere between $717 million and $820 million per year by fiscal year 2015–16 — a near doubling of annual costs in just 5 years. Further, these projections show the city’s annual pension payments reaching nearly $1 billion somewhere around fiscal year 2020–21. To address this, Mayor Lee indicated that negotiations must save at least $300 million to $400 million per year to save the city from near-certain bankruptcy.

The City’s pension costs are projected to rise to at least $700 million per year within 5 years.

Preliminary estimates indicate that maximum savings generated will be approximately $60 million in the first year (2012–13) and total just over $1 billion over 10 years — well short of the Mayor’s original estimates, and well short of the projected increase in pension costs. Estimates of savings from the Adachi proposal total more than $100 million in the first year and $1.6 billion over 10 years.

What does all of this mean? Simply: neither of the solutions currently on the table actually solve the pension problem, but they certainly move things in the right direction. At best, they address 10 to 20 percent of the total pension burden at its projected peak and continue to divert significant funding from important public programs. And these savings will only be realized if one (or both) of these proposals is approved by voters in November. Unfortunately, all signs point toward two competing measures on the ballot — whether the second is driven by Adachi or by members of his coalition.

The Board of Supervisors Rules Committee meets the first and third Thursday of each month at 1:30 p.m. Follow their discussion of the consensus proposal here.

When Obama was elected, supporters of progressive transit talked excitedly about a "new New Deal." Comprehensive national infrastructure plans have guided each era of American growth and development. America 2050, a national coalition that SPUR is a part of, created a prospectus for a modern national plan modeled on three prior ones: the Gallatin Plan of 1808, the Inland Waterways Commission Plan of 1908 and the National Toll Road and Free Road Plan of the 1930s.

The President has rhetorically endorsed progressive national infrastructure investment for this era. In his Columbus Day speech he called for "a smart system of infrastructure equal to the needs of the 21st century; a system that encourages sustainable communities with easier access to our jobs, to our schools, to our homes"¦a system that reduces harmful emissions over time and creates jobs right now."

Yet over the past week the administration showed signs of backing away from pushing such legislation forward this year, leaving observers scratching their heads.

Are these high-profile announcements solely political? An attempt to energize the base during election season? Or are they serious agenda-setting statements? Most importantly, will progress actually be made this year in Washington on modernizing our country's infrastructure?

While this proposal may seem like a political trial balloon this fall, infrastructure spending will likely anchor the legislative agenda for 2011. Why? Because it has bipartisan support and strong backing from financial interests, state and municipalities. Infrastructure spending has typically been an enterprise that Republicans and Democrats agree upon and could provide an area of consensus in a divided legislature. It's exactly the type of modest legislation that President Clinton used in 1995 and '96 to move forward after losing party control of Congress.

Obama's infrastructure investment proposal is, in effect, a $50 billion down-payment on the $450 billion six-year transportation bill that failed to pass Congress last year. Note also that the $50 billion does not come close to the $2.2 trillion the American Society of Civil Engineers says is needed to repair existing infrastructure. But a $50 billion investment "jumpstart" is a pragmatic way of moving forward on urgent repairs.

The President has proposed to change the way transportation funding works, in particular by using some sort of performance-based criteria rather than "return to source" or earmarks; but "” who knows? "” this is the always-announced, never-implemented agenda of the reformers.

Rails or roads? [Photo Credit: flickr user jr⁹⁸⁶⁶⁴]

Here is my own prediction about the timeline of how this legislation will play out in Washington:

• Look for an 11th hour attempt by Democrats to bring up Obama's infrastructure plan in November's lame-duck Congress; Republicans will rebuff it.

• In January, when the new, 112th Congress convenes there will be a good month of gavel-shifting and maneuvering.

• Infrastructure spending will be seriously discussed again in February when Republicans must begin to share responsibility for hastening and improving the economy's "jobless recovery."

• Most important will be the President's Fiscal Year 2012 proposal budget, which will be announced at the end of January after the State of the Union address. In all likelihood, when the President releases his budget, there will be a specific line item for the infrastructure bank.

• How Congress responds to the 2012 budget proposals in March and April will be crucial. But the groundwork for this debate should be developed now, and in the weeks immediately ahead.

With transportation bills of any type, there is always a fight over which portion goes to more highway construction and what portion goes to energy-efficient transit. SPUR has of course advocated that the country shift as much funding as possible to transit. But even if that goal is politically ahead of the legislature, we should at least be able to provide an equal federal funding match to transit and highway projects, rather than paying a higher share of highways as is the practice today.

There are a lot of politics to get through. We have joined the Transportation for America coalition as our show of support for a forward-looking investment in a better transportation system. We hope the President's $50 billion proposal, which covers transit and much else, will help get the ball rolling on what surely must be a national priority.

[Photo Credit: Colleen McHugh]

The San Francisco Department of Elections announced on Monday that the Fix Muni Now campaign had submitted enough voter signatures to qualify their Muni reform measure for the ballot.

The Department of Elections conducted a random sample of 2,248 signatures of the total 74,933 submitted and, based on this statistical sampling, determined there were more than the 44,382 signatures required.

The measure, if approved by voters in November, would require the Muni operators union, TWU-250A, to engage in direct negotiations for their wages and benefits, like every other public service union in San Francisco. Currently, operator wages and benefits are guaranteed in the City Charter to be, at a minimum, the second-highest in the country. TWU-250A is the only public service union in the city that has made no concessions during the recession of the past several years, opting instead to collect an automatic raise on July 1st, less than a month after Muni service was cut by ten percent.

By restoring collective bargaining as the method by which wages and benefits are determined, the City of San Francisco will be able to address inefficient operator work rules, which a recent audit by the City Budget Analyst estimates cost the city several million dollars per year.

Are you interested in helping the campaign? Click here to donate to the campaign, or click here to volunteer.

Not so fast says the Atlantic’s James Fallows in a new article on “How America Can Rise Again.” People have argued we were in decline since the earliest days of the republic. His prescription: Focus on maintaining our top universities to foster innovation and open immigration to keep people and ideas flowing into our country. From SPUR’s perspective, we would add – and invest heavily in high speed rail and other infrastructure that enables non-auto mobility.