Friday, November 02, 2012

Early Retirement Pay Outs Costly to Taxpayers & Other City Pensioners

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    The following is a draft of a memorandum of understanding proposed between the City and the Teamsters Local #571 offering certain employees an incentive to retire prior to their normal eligibility.  The following is a draft and has not been formalized or accepted by the Council and could change.  We understand that the employees have until November 7th to indicate their interest in the package and until that point the actual cost to the City has not been determined.  
     However, this is going to be an expensive package if implemented:  there are between 40 and 50 members of the union and of course it's unknown how many will take the offer so there are no numbers regarding the impact on the general fund as of now.  For those directors that are not part of the union, it is rumored that the City is offering up to 5 years of service;  so say you've 18 years of service, that could be now 23 years of service which at 2.5% would be 57.5% of the average of the highest 3 years of salary.  If the average salary is $90,000, the annual pension would be $51,750 or $4,312.50 per month.  Now they would be able to start collecting this pension 5 years earlier than they normally could have.
     Pensions from the City are capped at 70% of a set average salary, however this union's contract has adjusted that cap to 80% based on the retiree paying a higher percentage for their health insurance.  This draft offers some employees who have been with the city for 35 years or more a cap at 85%.  If their average salary were $100,000 (which is possible since overtime is included in their base salaries for the calculation), an additional 5% is $5,000.00 per year.
     However, the general rule of thumb has been that a golden handshake only saves money if you don't replace the retiring members; that doesn't seem to be the case here. If the building official retires, are you not going to replace him?  From the council agenda, it appears that the intent is to replace the Director and or Deputy Director of Personnel with Deputy City Attorneys, savings?? 
     Also, during the budget process this year, the pension funds was not funded to the extent that the actuaries had indicated and a special committe was to be formed to review the pension funding.   By giving the highest paid employees effectively a minimum of an additional 5% to their pension for their lifetime is going to be a tremendous hit to the pension fund.  These numbers of course are not available as of yet.  Remember, this union just won at the state labor board a case against the City and BOE where a union member retired and was replaced by a non-union worker, so they've a history of protecting their positions.
     Health insurance should be mentioned here also cause it's not mentioned in the offer at all; so not paying any more or less as a result of getting a higher pension.
     These seems to be an expensive way to get people to retire.  Offering 5 additional years to those employees who are not members of the union just to get them to retire is very generous!  Seems that it would be less expensive to negotiate with those employees who you wish to have leave on an individual basis rather than give away the farm to the whole management tier.
     Drew is cleaning house of directors who did not support him under the "guise" of saving money, however; the fact is that this will over in-flat city government departments and cost more.One can only speculate whom Drew and the Democratic majority/Serracrats have in mind to place in possible new director positions....
Lisa Santangelo? Another unqualified relative of Councilwoman Hope Kasper?


  1. If the Personnel Director leaves it will save tons of money! She has cost the city so much between her generous labor decisions, undermining of management, and placement of staff in positions they aren't qualified for.

    Good riddance to bad pennies. The pension fund should pay for them to leave.

  2. All I can say is I think the last comment @ 12:13 is on correct. Good riddance.

  3. The 2 previous posters must be the product of bad management that has cost the City thousands in litigation because they can't understand simple things like labor contracts or the Municipal Employees Relations Act. The City may very well be getting rid of the ONLY person who has told management they are overpaid and inadequate in their jobs. hummm the posters must then be from Water & Sewer!

  4. to anonymous 12:13 ... Are you kidding me??? The current Personnel Director has been nothing but fair! All others before her were just liars who supported management blindly. What is wrong with making decisions based upon facts versus an us versus them mentality? Good luck City cuz your labor relations just went to hell and and hand basket. I hope you are wrong and she doesn't leave! God only knows we don't need another kiss a$$ director!!!!

  5. Of course the Director of Personnel is going to leave. She isn't part of the kiss butt team required by Team Drew

  6. Nobody minded the Personnel director when she ran things for the Dems. Now that she's realized what scam artests they really are, they dispize her. As a director, she's been nothing but fair to both sides. The contracts she negotiated were fair to the workers and the City. The public only hears about the benefits, not the give backs that were involved.

    1. The only thing she realized was with the new mayor she wasn't going to get away with the BS she's been doing. She's been put in her place and actually doing only HER job and not sticking her nose in every other department. Yeah poor Deb....there's a reason why everyone hates her.

  7. The Personnel Director is responsible for these burdensome employee contracts. Why she was allowed to negotiate them is a mystery, after all she really had no labor experience prior to her patronage job.

  8. To all you anonmous-es-es-esesese, all i can tell you is normal people like me are gonna fill the void of the Directors and make a killing !!! Like em or not (me not) this is gonna cause a huge vaccum in power and yes for you nay sayers a lot of experience.

    I welcome this so I can finaly make some money instead of eating rice cakes for the past 16 years. I might even move to Mental Town for $90K a year.


  9. Heh since people want to pick on Personnel lets point out the fact that your Water & Sewer bill came late again! That's about the 4th year in a row that Director Russo managed to screw up his finances and we the public have less time to pay! The best part was getting the newsletter talking about the election AFTER the election. But Team Drew will keep him around... Got to love the boys club!


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