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What you need to know for 10/22/2017

Editorial: No time for pension sweeteners

Editorial: No time for pension sweeteners

Pension costs are crushing governments, but the sweeteners keep coming

You'd would think that with the state in a fiscal abyss, and many already-desperate governments looking at cutting services, raising taxes or borrowing money to meet exploding pension costs, no lawmaker would have the nerve to introduce one of those “pension sweeteners” that make it easier for public employees to retire even earlier with even more money. And you'd be wrong. There may be fewer of these union-pleasing bills than in recent years, but they are still being introduced and in some cases passed.

The most costly are the systemic ones that weaken the distinctions between pension-system tiers, which were created for newer workers because, under the state constitution, benefits can never be diminished for older ones.

There are already a couple of bills in both the Senate and Assembly that would undo some of the concessions won from unions just a few months ago with the new Tier V. One would reduce the minimum retirement age for state and local employees with enough service time to retire with full benefits, and eliminate it for police and firefighters. Together these two bills, if they became law, would cost the state more than $20 million in the first year, and local governments more than $9 million.

Less costly, but still problematic, are special pieces of legislation to benefit a small group of employees — or even, in some cases, a single person. Last year Sen. Hugh Farley introduced three of these bills to give individuals in his district retroactive Tier I status, the gold standard for pensions in New York state, providing the most generous benefits, such as no employee contributions and full benefits at age 55 with 30 years’ service.

The bills say these people were eligible to become members of the retirement system back in the 1970s but did not “through no fault of their own,” and they should now be given Tier I status. And the state should pay them, immediately, more than $200,000 for past contributions and another $5,000 annually for their pensions, while an impoverished city like Gloversville should make a one-time payment of $57,000.

It’s hard to criticize Farley for going to bat for his constituents. But he admits that he doesn’t make much effort to ensure these people were entitled to be Tier I members (in other words, he doesn’t really know whether they missed out “through no fault of their own”), leaving that to the committee on pensions, It’s also true that such bills often don’t go anywhere, either because they don’t make it through committee (often for lack of documentation) or are one-house bills. But they allow the legislator to say, “Gee, I tried, but ...” However, sometimes they do pass — at considerable cost to the state and local governments.

Special legislation isn’t the right way to address an individual’s tier status, but apparently it is now the only way. The state comptroller’s office, which administers the system, should be given clear authority to do make such judgments, ideally with some means of appeal. But lawmakers should be very wary about doing anything that saddles taxpayers with higher costs for public employees, especially now, when it has become obvious that those costs are unsustainable and the unions keep refusing to give up anything.

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