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What you need to know for 06/28/2017

Editorial: A tale of two bloated pensions

Editorial: A tale of two bloated pensions

State's lucrative law encourages padding with overtime

Is it just a coincidence that Schenectady’s sewer maintenance supervisor, Patrick Tremante — the top moneymaker on the city’s payroll last year, grossing $150,404, or more than double his $68,000 base pay — retired this week? Carl Olsen, the general services commissioner under whom Tremante worked, tried to imply as much in news reports Thursday, claiming that Tremante and Dave Savignano, another general services supervisor who cracked the Top 10 money list thanks to oodles of overtime and who also happens to be retiring, were duty-bound to work the long hours they did.

Yes, but ... a little deductive reasoning produces a different theory for why the men worked all that overtime — $81,000 in Tremante’s case and $51,000 in Savignano’s. It will boost their pension payouts — which are based, in part, on how much they made during their last three years on the job — tremendously.

For the record, Tremante made $124,847, $141,296 and $150,404, respectively, in those three years — as compared with only $118,032 the year before. Savignano earned $107,568, $114,211 and $120,530 during his pension-calculation period, and only $87,176 the year before. Each has more than 37 years on the job, so they’ll wind up with annual pensions (roughly equal to 70 percent of the average of their final three years’ pay) well in excess of their base pay. And that’s good every year for the rest of their lives.

We’re not blaming these men, both of whom have been good public servants, for jumping aboard the municipal gravy train. Who wouldn’t, if given the same opportunity? The problem, of course, is that the formulas for calculating the, pensions, established by the state, encourage pension “padding.” But they are immutable for political reasons. (The formulas were finally made a little less lucrative under the newly created Tier V, but it’s going to be years before its effects are felt.)

Still, there are some things municipalities can do to deal with the problem. One is to strictly limit the amount of overtime employees may work, especially those nearing retirement. Another is to reclassify supervisory jobs so they no longer fall under Civil Service rules.

Schenectady has done both of these things to some extent, but needs to do more — especially in the former category. If, for example, it had done a better job limiting Tremante’s and Savignano’s overtime for the past three years, their pensions might be $30,00-$50,000 a year smaller than they will be. These amounts may seem insignificant until you consider that they could be for 25 years or more, and that the city has hundreds of other employees — mostly retired cops and firefighters — all in the same boat. Is it any wonder that the city’s annual pension obligation — $6.3 million — has been wreaking havoc with its budget?

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