If 2010 was a momentous year politically, it was also one in which not much seemed to get done, at least at the state and local levels — and much of the activity in Congress occurred during a last-minute flurry in the lame-duck session. That means there's a lot of unfinished business, some of which will cause serious hardship if it isn't dealt with in 2011.
Looking back, and forward, we offer a few priorities for Los Angeles, California and Washington.
City pension reform
The city's budget, much like the state's, contains a time bomb. Generous public employee pension deals granted by past leaders and voters were based on a deeply flawed assumption: that the economy would keep growing at a brisk pace, allowing investments in government-held pension funds to rise fast enough to cover expenses. In bad years, and we've had a few lately, the city has to make up for shortfalls by dipping into its general fund. That has created a dire financial situation that is expected to get considerably worse unless pension reforms are approved.
In March, Los Angeles voters will be asked to consider a ballot measure that would change the terms of the city's pension deals for newly hired police officers and firefighters. Rising pension and retiree healthcare costs for public safety workers are expected to consume 19% of the city budget within five years (up from 8.7% this year). Under the reform, new hires would get a lower percentage of their salary at retirement and would have to pay an additional 2% of their current salaries, on top of the 9% already contributed toward the pension fund, to cover retiree health costs. It's a modest change that won't go far enough to solve the problem, but it's a start.
Meanwhile, the larger worry — pension costs for other municipal employees — hasn't yet been addressed. Pension changes for newly hired civilian employees can be approved by the City Council without voter approval, but the council appears to be waiting to see what happens with the public safety employee measure before proceeding. Action is urgently needed; forecasters say overall retirement costs will account for one-third of the city's general fund by 2015 if they keep growing at their current rate, which would take an enormous bite out of the public services L.A. provides. Decisions will be difficult and politically contentious, but they shouldn't be put off any more.
State water plans
In 2009, something remarkable happened: After decades of feuding among farmers, cities, environmentalists, fishermen, liberals and conservatives over state water supplies, the Legislature approved a policy plan that came as close as Sacramento ever has to balancing these groups' competing needs and wishes. Separately, lawmakers also put together an $11-billion bond package, subject to approval from voters, that would pay for projects to boost water supplies and improve the environment, including groundwater cleanup efforts in Los Angeles and dams throughout the state. There were many distasteful aspects of both the plan and the bond deal, but at least they represented the beginnings of a solution to supply problems that are growing worse as California's population rises and its snowpack declines.
And then, in August, the bond deal came apart. Realizing that bonds would be a tough sell politically during the recession, Gov. Arnold Schwarzenegger decided to pull the water initiative off the November ballot and table it until 2012 (and unless the economy improves significantly by then, it may not appear until years later). Meanwhile, another, potentially even more vital water deal is in danger of unraveling.
State officials have been working for years on plans for an "alternative conveyance" for the Sacramento-San Joaquin River Delta, from which Los Angeles derives 30% of its water. Heavy pumping of delta water has ruined the estuary's ecosystem while failing to meet the demands of farmers and cities to the south. This month, state officials recommended construction of a $13-billion tunnel to carry water under the delta, which would theoretically boost water deliveries while also protecting delta fish and wildlife. But the water agencies that would pay for the project are skeptical that they would benefit, and environmentalists worry that the delta would still suffer. One Central California district has already pulled out of the planning process, and more may follow.
Incoming Gov. Jerry Brown will have his hands full trying to balance the state's budget, but he'll need to demonstrate strong and steady leadership on water issues to prevent the progress already made from evaporating.