Thursday, January 06, 2000

City retirement board considers sweetened pension plan

The Cincinnati Enquirer

        Cincinnati city workers could retire with 25 years of service at age 48 and collect 62.5 percent of their salaries as pensions under a plan being considered by the city's retirement board.

        But city administrators say it is the taxpayer who will be paying for those early outs — at a cost of $5 million to $20 million a year.

        “This plan would cost the city a significant amount of money to improve one of the best retirement plans in the country,” said Finance Director Timothy Riordan.

        The plan, being considered today by the city's retirement board, would lower the age and number of years an employee would need to work before becoming eligible for pension and health benefits.

        But Councilman Todd Portune, who sits on the board, says the early retirements would ultimately save the city millions in salaries by getting people off the city payroll who do not need to be replaced.

        “We are going to have to do it,” he said, adding that the city needs to consolidate positions and eliminate nonessential jobs. “This is a compassionate way to get it done.”

        He said the amount saved would “far outstrip” what the city is required to pay out.

        “Just think about it,” he said, offering an example of 1,000 employees retiring who are making an average of $50,000 a year. “That would be $50 million a year.”

        City Manager John Shirey said he has thought about it and it doesn't make sense. He said the savings aren't clear-cut because retired employees collect a percentage of their salary.

        “When you look at life expectancy these days, if a person retires at 48 years old, you could end up paying them for more years of retirement than they actually worked for the city,” he said.

        The retirement changes, which were approved by a subcommittee of the retirement board Monday, would allow 25-year employees to retire at age 48 and collect about 62.5 percent of their salary.

        The way it is now, employees can retire after 30 years and collect 75 percent of their salary.

        Under both plans, employees would continue to get full medical benefits for themselves and their families and a 3 percent cost-of-living adjustment compounded annually.

        This applies only to regular city employees and not police officers and firefighters, who have a separate retirement plan.

        “The public does not expect us to give government employees such a rich and generous retirement plan,” Mr. Shirey said. “If Mr. Portune wants to reduce the work force, the way to do it is by reducing the budget.”

        Mr. Portune said today's vote — scheduled for 1:30 p.m. in a third-floor conference room at City Hall — is the second time since 1998 that the retirement board has considered easing retirement requirements. The first ended in a deadlocked 5-5 vote with one member absent.

        The 11-member board, which oversees an estimated $2.6 billion in assets for about 6,200 active employees and 4,200 retirees, makes recommendations to the City Council, which would be required to vote on any changes.

        Private actuaries hired by the city to examine the retirement system have estimated the city would have to put as much as $20 million more every year into the retirement sys tem. He said those costs would have to come out of the city's operating budget.

        “The law says the costs have to be borne by the employer, in this case, the city,” Mr. Riordan said.

        Pointing to a “log jam” of promotional opportunities, particularly among women and minorities, Mr. Portune said the retirement changes could provide opportunities while cutting the number of city employees.

        “This makes our retirement package attractive,” he said. “We are not going to lose anything.”

        Mr. Shirey said there is no need to make the city's retirement system any more attractive than it already is.

        “We have no trouble attracting employees, we have no trouble keeping employees,” he said, adding that he doesn't want to lose experienced employees. “I think one of my worries, other than money, is that this could be a serious brain drain.”


Closing in on Patty's killer
Luken: Convention Center expansion too costly
Judicial elections may be no contest
'Big Pig Gig' porkers on the way
Folks having pun with pigs they buy
Judge won't yank Justin away
30 years on the run ends with prison term
Bomb threat empties Anderson High
West Hi gets bomb threats
Cheating alleged at E-Check site
Children Services board asked to resign
- City retirement board considers sweetened pension plan
City says no to more funds for football game
Ex-Chiquita lawyer says being informant was costly
Hebrew Union's leader leaving
Ky. companies called tech laggards
Warren jail again short of cell space
Online fashion shopping virtually limitless
Ho, ho, ho: Who would know the answer?
Children shown way to escape abuse
Queen City's moments to shine reflected in book
Party time for new majority GOP
Access channel adds weather info
Attorney gets time to probe abestos claims
Couple travels Ohio for railroad safety program
CPS, union OK fact-finder
Deerfield board votes Morand as president
Earmarking of lottery asked
Enterprise zones may be folded
False arrest claimed in suit
Family loses all in fire started by boy
Local radio veteran dies
Mayor to visit Avondale, leaders
Monroe debates trash contract
Officials to decide on new search for recreation chief
Patton seeks aid for Owensboro
Pedestrian fatality snarls I-75 traffic
Police seek new leads in Christmas tree vandalism
Treasurer: Job cut will hurt Norwood
Wheelchair bus rider sues Metro