PENSIONS -- Need Repair

PENSIONS -- Need Repair

Postby Nick Della Volpe » Thu May 29, 2014 2:49 pm

PENSIONS. It’s a sticky mess to get into, but the city's financial future depends on addressing key features and legacy problems of existing pension plans for city workers. At the end of the day, These plans only work if we can afford to fund them.
Some items we need to address include:
1) The annual COLA for the 3000+ persons that remain in the closed plans (plans G and C, covering general government, police and fire) should be limited to changes in the actual CPI with a max adjustment of 1 ½ to 2% per year. No more automatic 3%. (Nor another 1% should the CPI exceed that). Actual CPI for the past several years has actually been closer to 1 ½%.

2) A financial incentive should be provided to the 1490 active workers to switch over to the new plan H. Otherwise future market turbulence could further increase the underfunding problem.

3) Those workers who choose to remain in the old plans G and C should be required to pay more into the pot, say 10% of wages instead of the current 6%. Right now you, the taxpayer are contributing a lot more, about 5 to 1.

4) All quirky loopholes, like leave-it-to-the-kids for an extra 40 years, should be eliminated.

5) Greater emphasis should be given to 401k type plans. The city helps put money into your employee pot, it’s yours to manage, and it’s portable should you leave. We need to get the market risk off the taxpayers' backs.

It remains to be seen whether the administration will roll up its sleeves and tackle this soon-to-be $30M per year financial problem. No more hiding behind the Blackwell boogeyman . Do the right thing, and let the courts sort out any disputes. The government is supposed to work for the people.

City Council representatives need to man up, instead of wishing tough decisions will somehow go away. Kicking this can down the road is fiscal suicide. Make a decision and put the proposal on the ballot. Let the people decide.

Nick Della Volpe, 4th District
Nick Della Volpe
 
Posts: 107
Joined: Mon Jul 02, 2012 4:00 pm

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