This proposal would affect newly hired police officers and firefighters. It would require them to work longer and pay 2 percent of their salary into the pension fund in order to qualify for health care as part of their retirement benefits.
Currently, city employees do not pay for their health care benefits they receive in retirement.
Existing personnel will be able to opt into the plan if they choose. The plan would save the city $173 million for every 1,000 new hires in the police and fire departments.
In a report released a few months ago, the city administrative officer said L.A. would have to spend about $800 million in the next five years for employee pensions, and that would consume nearly 30 percent of the general fund.
Los Angeles Mayor Antonio Villaraigosa said he will urge the City Council to place the reform plan on the municipal ballot in March 2011.
The new plan will need the approval of L.A. voters if it is adopted by City Council.