Workers and retirees slam proposed Oregon pension cuts

They say proposed change is 'broken promise' to them

SALEM — Retired and active government employees slammed a proposal to cut their pension benefits, telling Oregon lawmakers Wednesday that the plan pushed by Democratic leaders would be unfair, irresponsible and illegal.

Instead of cutting their pension benefits, workers and retirees urged lawmakers to raise taxes on the rich and sue the big banks they blame for 2008 investment losses that wiped out 27 percent of the pension fund. They also want the state to do a better job going after people who cheat on their taxes. "When I started at the state, I believed we had a deal," Lisa Dixon, an office worker at the Department of Consumer and Business Services, told lawmakers. "I'll show up for 40 hours, maybe more, do a good job ... I expected the state in return to honor their end of the deal, as well."

Retirees said they made retirement decisions based on a promise that they'd receive a pension with a 2 percent inflation increase each year.

Democratic leaders have proposed limiting the inflation adjustment to boost spending on schools. State and local governments would save about $400 million over the next two years. They also propose eliminating, for retirees living out of state, surplus pension payments that cover state income tax bills, saving another $55 million.

The Senate Rules Committee could vote as soon as this morning to advance the proposal to the Budget Committee.

Criticism of the proposal came from all sides. School advocates and legislative Republicans said it didn't go far enough to reduce pension costs for government agencies. Republican leaders and Democratic Gov. John Kitzhaber have their own proposals that would cut deeper.

Public employees told lawmakers the budget shouldn't be balanced on their backs. "This stands to be a broken promise to the public employees here," said Jay Thatcher, a Corvallis teacher. "What will you do to find good quality public employees in the future?"

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