Friday, January 07, 2000
Board loosens pension standards
Council vote next on change
BY ROBERT ANGLEN
The Cincinnati Enquirer
Disputing claims that a plan to let Cincinnati employees retire early would cause a mass exodus and cost millions, the city's retirement board voted Thursday to lessen eligibility standards.
The changes, which will now go to City Council, would allow employees to collect pension benefits at age 48 with 25 years of service rather than waiting 30.
But city administrators said the system is already one of the most lucrative in the country and changes could cost taxpayers up to $40 million a year.
“When I came to the city, the first thing I had to do was find $9 million to pay for (an early-retirement program) that was touted as a way to save the city money,” said City Manager John Shirey.
He called the new retirement plan “one that most of our citizens, most of our customers, don't have available to them.”
In a 6-5 vote, the retirement board said the new plan is only an option most employees will not take. Members noted that the city's contribution to the retirement fund has dropped from 17 percent to 7 percent in recent years.
“That's a $21 million savings to the city,” said board member Michael Rachford, ticking off several reasons he supported the plan, including that the majority of employees want it and that it will “cut the fat” out of a top-heavy administration.
He also said that it would reduce salaries if long-term employees are replaced by entry-level staffers and allow for minority promotions.
But other board members said the changes do nothing for much of the system's 10,000 members.
“It does nothing for 4,123 members who have already retired,” said board member Ely Ryder of the city's law department. “It does nothing for the 324 members who are currently eligible for retirement. It does nothing for 104 members who have taken a deferred retirement.”
He said the changes could result in a raid on the retirement system's $2.6 billion in assets, and that the city could give credits for years of service to every employee.
“Many members would be eligible for retirement immediately,” he said. “When combined with dental and vision coverage for retirees and increasing the interest on member contributions, all members would benefit.”
In an August report to the board, an actuarial firm hired by the city said it could cost from $10.2 million to $40.9 million a year, depending on how many employees take advantage of the plan. Representatives told the board Thursday changes would not jeopardize the retirement system's assets unless contributions do not increase as employees draw benefits.
“It's simple,” Mr. Riordan said, who estimates that the actual costs to the city's general fund would be $5 million to $20 million. “If you put in less and take out more, you are going to have a problem.”
The city's general fund pays for basic city services such as police and fire and employee salaries.
Under the plan, employees could retire at age 48 and collect about 62.5 percent of their salary. Employees can now retire after 30 years of service and collect 75 percent of their salary. This does not apply to police officers and firefighters, who are covered under a separate retirement plan.
This is the second time in two years that the 11-member board has considered reducing the retirement age for city employees. In 1998, the board deadlocked in a 5-5 vote with one member absent.
The same thing very nearly occurred Thursday, with a tie vote and one member abstaining. The division was primarily between employee representatives and the administration, with two City Council members taking opposite sides.
Councilwoman Minette Cooper said the changes in the system give unnecessary benefits to employees.
“I don't agree. I believe this is an incentive, not an option,” she said before the meeting. “If it ain't broke, don't fix it.”
Councilman Todd Portune said the plan would force the administration to make cuts to staff and “take a good, hard look at the jobs that need to be filled.”
In a heated exchange that took up a good chunk of the nearly 90-minute discussion, Mr. Portune and Mr. Shirey disputed benefits of the changes.
“I am disappointed the city manager is pushing all the hot buttons,” Mr. Portune said, adding that the city manager was playing on fears of cost and an employee exodus.
Mr. Shirey countered that Mr. Portune was being inconsistent and that if the plan was being pushed as a way to reduce staff, then it would not help minorities get promotions.
At the last minute, board member Ezell Adams changed his abstention to vote in favor of the plan, saying he “could not go against” the American Federation of State, County and Municipal Employees, of which he is a member.
Personally opposed to the plan, Mr. Adams said he was between a rock and a hard place “so I decided just let it go before the council.”
Americana park ends 77 years of family fun
25 million visited park over 77 years
Feeling sick? It's probably not flu - yet
Telltale signs your cold's not flu
The end is near - maybe
Dems may send novice against Chabot
Boehner files for 6th House term
Boehner foe will try again
County advertises for foster parents
Dead man indicted on drug charge
More bribery allegations at E-check site
Ban smoking? Hamilton debate heated
Board loosens pension standards
Boater pleads not guilty in deaths
Driver's alcohol level cited in teacher's death
Mayor maps out 'rebirth' plan
Queen City's moments to shine reflected in book
Best part of 'Malcolm' is Malcolm
Blue Ash couple counts on gang of old friends
GET TO IT
Auditor: Voucher school owes $80,000
Bank robbery defendant to pursue deal, lawyer says
County vows to fight billboards
Court suspends lawyer's license
Duveneck House renewal OK
Fernald cleanup crew looks to finish in 2006
Fire-damaged center to reopen
Judge Black joins Supreme Court race
McConnell, Bunning star at fund-raiser
New fire chief feels lucky
New water main in Whitewater fails test
Rural-crash fatalities fall in Ky.
School expansion taking shape
Sewer stench forces office to close
Tornado destroyed or damaged 2,277 homes
TRISTATE DIGEST
