A “3% at 50” retirement plan allows public employees to retire any time after they reach the age of fifty and annually receive a percentage of their highest salary as their pension. This type of plan that guarantees certain benefits is called a defined benefit plan and is common among public pensions. Under this plan, the percentage of salary paid to the employee after retirement is determined by the retiree’s number of years of employment increased by 3% for every year of service. Thus, the “3%” works as a multiplier. The salary percentage employees receive after retirement is equal to 3 times the number of years they have worked. For example, 10 years of employment would result in a retirement salary percentage of 30% and 30 years of employment would result in a retirement salary percentage of 90%.
This plan is offered as a negotiated benefit plan by the California Public Employees’ Retirement System (CalPERS) and 37 Act Counties for local safety members. The following is a list of cities and counties, totaling 251, that offer this substantial pension benefit plan:
In Pacific Grove, proponents of a measure that would turn back pension benefits for public safety employees submitted enough valid signatures to put their initiative on the 2013 ballot. They claimed that the benefits of public safety officers were illegally increased to “3% at 50” in 2002 and should be rolled back. However, the city council, leery of expensive litigation and concerned the proposed initiative would not pass constitutional muster, tabled the measure by seeking “judicial relief” and sending the measure to the judicial branch of city government for legal analysis.
- Peace Officers Research Association of California website, “Agencies with 3% @ 50 Retirement,” accessed December 16, 2013
- ↑ Peace Officers Research Association of California website, “Agencies with 3% @ 50 Retirement,” accessed December 16, 2013