How Can California Reduce the Costs of Incarceration?

California Governor Gavin Newsom has agreed to give state prison correctional officers a 3 percent raise. According to the Legislative Analyst’s Office, there is “no evident justification” for this raise.

A recent article in the Sacramento Bee summarizes portions of the LAO report, writing “The last time the state compared state correctional officers’ salaries to their local government counterparts, in 2013, state correctional officers made 40 percent more than officers in county-run jails, according to the LAO analysis,” and, “Since 2013, salary increases for state correctional officers have increased by a compounded 24 percent, according to the LAO.”

Within the LAO report, it is made clear that the rising cost for pensions is a major factor in escalating compensation costs for California’s prison guards. In theory, the cost to provide pension benefits is reasonable. The so-called “normal cost” of a pension is how much you have to pay if your pension system is fully funded. Unfortunately, that’s a big if. Today, the normal cost is only a small fraction of total pension costs. Most of the money going to CalPERS is to pay down their unfunded liability, built up over years of insufficient annual payments, along with lower than projected investment returns, and benefit enhancements that were justified using overly optimistic financial projections. CalPERS, the pension system that serves the California Correctional Officers, is underfunded by at least $138 billion. It is only 71 percent funded.

To see how this translates into the cost of individual pension benefits for California’s prison guards, useful information can be had by downloading raw data for state agencies from the California State Controller’s “public pay” online database. For example, using the most recent available data from the State Controller, in 2017 there were 21,558 prison guards who worked full time that year and were eligible for a “3@50” pension (pension equals three percent, times years worked, times final year base pay – eligibility at age 50). The average base pay for these guards was $87,460. Their average pension cost was $40,061, forty five percent.

State Controller data also offers insight into how much the modest PEPRA reforms of 2013 reduced pension costs, since California’s Dept. of Corrections also had 7,161 prison guards who in 2017 worked full time and were eligible for a “2.5@55” pension – in some cases this reduction was due to PEPRA. Their average base pay was $93,054, and their average pension contribution was $21,716, which equates to 23 percent, only half as much.

It’s easy to rail against the pay and pension benefits collected by public employees in California. And in the case of overpaid, underworked state and local bureaucrats who often are incompetent and indifferent towards business owners and homeowners who are trying in good faith to navigate California’s ridiculously excessive rules and regulations, that ire is appropriate. But before leveling that criticism at California’s correctional officers, one might consider what it takes to manage the criminally insane, or members of international gangs with friends inside and outside of prison, or, for that matter, the general prison population of thieves, thugs, wastrels and predators. If it’s such a cush job, go apply.

Nonetheless, especially when it comes to California’s pensions, something’s got to give. One solution which could be done overnight, without legislation or litigation if the CCPOA would agree, would be to reduce the pension multiplier from 3.0 percent to 2.5 percent for all future work by all correctional officers regardless of hire date. The three percent accrual for work performed to-date would be preserved. This single change could save the state tens of billions.

Government union members need to understand something unequivocally: There is no special interest in California that even approaches government unions in terms of raw political power. With great power comes great responsibility.  Conscientious members of these unions should demand this power is used for the common good.

In the case of the prison guards, that would not only involve a voluntary, and significant concession on the question of pensions, as described. It would involve aggressive political involvement in correcting some huge, and very recent, policy mistakes. To cite just one example, California’s Prop. 47, the so called “get out of jail free” law, needs to be repealed through a ballot initiative. Somehow, the tens of thousands of drug addicts, drunks, and mentally ill who currently constitute the bulk of California’s unsheltered homeless need to be cost-effectively reincarcerated.

California’s prison guards union can and should play a productive role in reforming the laws that prevent society from getting these most problematic of the homeless off the streets. They should then work creatively with legislators and local authorities to figure out how best to help these people. Why can’t state and local mental health professionals in partnership with the Dept. of Corrections build less expensive work camps for nonviolent addicts and alcoholics, where they could dry out and contribute to society? Why does it have to cost $71,000 per year to incarcerate the average prisoner in California? Why are comparable amounts necessary to shelter the homeless? This is ridiculous.

There’s more. Instead of demanding annual raises in an attempt to cope with the cost-of-living in California, why aren’t government unions supporting policies that might lower California’s cost-of-living? Support an overhaul of California’s excessive environmentalist legislation – why does it take six years or more to build an apartment building in California, when it only takes months in other states? Support deregulation of land development, because high-density infill is an exercise in futility unless it’s matched by new construction on open land within this vast, nearly empty state. Support nuclear power, and reform ill-conceived renewables mandates. Et cetera.

California’s prison guards union may wish to think outside the cell.

This article originally appeared on the website of the California Policy Center.

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Edward Ring

Edward Ring is a contributing editor and senior fellow with the California Policy Center, which he co-founded in 2013 and served as its first president. He is also a senior fellow with the Center for American Greatness, and a regular contributor to the California Globe. His work has appeared in the Los Angeles Times, the Wall Street Journal, the Economist, Forbes, and other media outlets.

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