Public worker benefits are killing gov't services

From the NY Post:

Across New York, the cost of health benefits for retired government employees is growing so rapidly that it threatens to crowd out funding for essential government services. Rather than lay off police or close libraries, public officials may want to use their discretion to alter retiree health insurance — but some state legislators are trying to take away that discretion.

These lawmakers are introducing bills that would prevent government officials from reducing current benefit levels — in effect, forcing them to sacrifice core services instead.

In fiscal year 2012, New York City will pay $1.6 billion for health insurance for retired government employees — more than is budgeted for transportation and park operations combined. The state paid $1.3 billion for retiree health care in fiscal year 2011-12, as much as it gave to support the City University.

Retiree health-insurance costs are up 44 percent in the city budget and by a third in the state budget from just five years ago — and that’s still not enough to fully fund the future benefits that have been promised.

These unfunded liabilities are staggering — and growing. The most recent estimates are $84 billion for the city and $56 billion for the state. The Empire Center estimated the statewide unfunded liability at more than $200 billion in 2010.

New York City has the greatest liability because its health benefits are the most generous. It takes only 10 years of employment to vest for lifetime retiree health benefits, which begin upon retirement at any age and require no retiree premium contributions. The city even reimburses retirees over age 65 for the full cost of their Medicare Part B premiums.

Current law lets public employers make changes to health benefits. The only exception is for teachers in schools outside New York City; a 2009 law protects their retiree health benefits from reduction.

Now other unions are seeking the same protection. Six bills have been introduced in the Legislature to prevent state and local governments from reducing retiree health benefits unless public-employee unions agree to an equivalent reduction for their active members via collective bargaining — a highly unlikely event.

Their proponents claim these bills would have no fiscal impact because they provide no new benefits. But they would make it virtually impossible to save money at a time when the flexibility to grapple with pressing fiscal challenges is urgently needed.

As the costs of retiree health benefits grow, local governments and school districts across New York will have to choose between reasonable reductions in benefits or cuts in crucial services: police and fire, schools, roads and bridges, parks and so on.

Government retirees should always be treated fairly and with due respect for their public service, but it’s a mistake to tie the hands of state and local elected officials further. With health-care costs skyrocketing — and the unfunded liabilities already at staggering levels — they shouldn’t be put in a position where they have to lay off current workers and reduce services because they have no latitude in addressing retiree health-insurance costs.

Pricey pension pandering

From the NY Post:

Bowing to union pressure, legislators are proposing a sweeping pension bill that would allow thousands of state and city government workers to retire early with full benefits — at a cost of hundreds of millions of dollars to taxpayers, The Post has learned.

The early-retirement push clashes with Gov. Cuomo’s drive — backed by Mayor Bloomberg — to scale back pension costs.

The Assembly measure would allow public employees, including city teachers, to retire with full benefits at age 55 with 25 years of service.

Many public employees have to work at least 27 or 30 years before earning full retirement benefits. Others have to work until age 62 to qualify.

The bill’s sponsors admitted it would increase the state pension system’s cost by $167 million and boost city pension costs by tens of millions of dollars.

Lotsa double-dipping going on

From the NY Post:

State Comptroller Tom DiNapoli has numerous employees working under him who are pocketing both a state pension and a paycheck -- a dubious practice known as double dipping that pension-reform advocates fear is bankrupting the system, the Post has learned.

DiNapoli -- who has railed against the soaring costs of the pension system -- has more than a dozen double dippers, but could possibly have far more, according to a Post analysis of comptroller employees listed on SeeThroughNY.net, a database of public employees.

The Post initially discovered a whopping 50 possible double dippers, and asked the office to confirm whether or not they were in its employ.

After two weeks of repeated calls and e-mails from The Post, DiNapoli spokesman Dennis Tompkins said that the list wasn't accurate, and promised to provide an accurate accounting of the agency's double dippers. He never did.

In an e-mail, he defended the practice -- which is legal in special cases -- by saying that using retirees saves money, because the state doesn't have to pay health insurance and retirement contributions.

Critics charge that double dipping is bad for the $120 billion pension because those limited funds were intended for use only for retirees unable to work.

OT in overdrive

From the Daily News:

Of the top 20 overtime earners from the start of the year through Aug. 31, 13 have already matched or exceeded their base salaries.

Twelve of the top overtime earners work at state psychiatric hospitals. Five work at state prisons. Two others work at state-run facilities for the mentally disabled. Another big earner works at a SUNY-run hospital.

While OT is a distant memory for many private-sector workers, total overtime pay for state workers is up a hefty 8% so far this year over last - despite Gov. Paterson's vow to rein it in.

Through the end of last month, the state had doled out a whopping $299.4 million in extra pay, up $22.4 million from the same period last year, according to the controller's figures.

Erik Kriss, a spokesman for the governor's budget division, blamed budget cutbacks for the OT increases. He said state agencies have to do more with less staff.

Comptroller offers tips on how to game the pension system

From the NY Post:

A red-faced state Comptroller Tom DiNapoli -- who has been warning against rising pension costs -- yesterday removed from his Web site information about how state workers can game the pension system.

Until yesterday, a section on the comptroller's official Web site titled "Life Changes: How Do I . . . Prepare to Retire?" had provided state workers a veritable primer on pension padding.

Under the heading "Ways to Increase Your Pension," it encouraged workers to squirrel away sick time and cash in vacation days before retirement

One jaw-dropping section, titled "Increasing Your Final Average Salary (FAS) -- A Raise is Not the Only Way," appeared to actually encourage the practice of overtime spiking, in which veteran workers pile on extra hours to pad retirement checks.
State Comptroller Tom DiNapoli’s official Web site had featured a list of retirement tips that essentially read like a guide to pension padding, including a section that appeared to encourage the questionable practice of overtime spiking.

"Once you are informed, you will be able to determine if you can increase your pension by adding to your service credit, reducing loan balances or increasing your final average salary," it reads.

The "Message from Comptroller Thomas P. DiNapoli" put the Democratic comptroller at odds with Attorney General Andrew Cuomo, the party standard-bearer, who has made reining in pension abuse -- overtime spiking, in particular -- a theme of his gubernatorial campaign.