Study: Hybrid Pension Plans Would Save Billions

SACRAMENTO, Calif. (AP) -- A new study by a pension-reform group suggests California state and local governments could save billions of dollars a year by moving to a hybrid retirement plan similar to one used by the federal government.

The California Foundation for Fiscal Responsibility released its report Friday. It said the savings could be even greater if public employees who take early retirement contributed up to half of the cost of their retiree health care premiums.

The report studied potential savings if state and local governments reduced guaranteed pension benefits by half and replaced them with a system similar to the 401(k)s prevalent in the private sector.

A group supported by public employee unions criticized the report and said it was bankrolled by Texas billionaire John Arnold, a former Enron Corp. trader who made his fortune buying and selling natural gas.

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