DFA Bulletin re. State pension reforms – message from UCOP President Dynes

January 2005

UCOP President Dynes made the following announcement in his recent newsletter. This newsletter is available on the web at www.universityofcalifornia.edu/news/newsletter/issue16.html.

Update on pension proposal

In his recent State of the State address, Gov. Schwarzenegger indicated his intention to reform state pension plans in the near future by only offering defined contribution retirement plans to state employees hired on or after July 1, 2007. A constitutional amendment to this effect has been introduced in a special legislative session that the governor has called.

Although the constitutional amendment expressly includes the University, UC employees should be very clear that even if the governor’s proposal is passed by the Legislature and the California electorate, it would pertain only to UC employees hired on or after July 1, 2007 – current UC employees would not be impacted.

The University is in the process of analyzing this proposal, and UC representatives will be discussing it in detail with state leaders in the weeks ahead. Accordingly, it is too early to know what, if any, impact this proposal might ultimately have on UC.

There are many important considerations that must be taken into account in any proposal that seeks to include UC in this initiative. The University of California, with its ten campuses, five medical centers and three national laboratories, is a complex institution with distinct and diverse needs, and UC would be concerned that a constitutional amendment might restrict our flexibility to fashion suitable retirement plans for our unique employee populations.

We know this issue is of interest to everyone in the UC community, and we will promptly distribute additional information as it becomes available.