PENSION REFORM WHACKS NEW EMPLOYEES

NYS Retirement System Gets Major Overhaul with Tier V

Albany, N.Y.-- Incoming NYS public employees that pay into the retirement system have an even larger target on their back these days.

On December 2, lawmakers approved with no debate a massive pension reform bill which sailed through both houses of the state legislature. Governor Paterson says the bill does not go far enough to get us out of our fiscal mess, but vows to make it happen anyway.

Under a three-way agreement with the Governor, Assembly and the Senate, the measure established a new Tier V. Advocates say it will cut over $2.7 billion for the 2009-2010 fiscal year. State lawmakers also say that it is expected to save taxpayers over $48 billion over the next three decades. To read the NYS Assembly Extraordinary Session Bill A 26, click here. To read the senate spin machine on passing this bill, click here.

Assembly Speaker Sheldon Silver (D-Manhattan), says the legislation applies to both uniformed and non-uniformed employees and significantly reforms the pension system. Silver also says the legislation sets the stage for the long term financial stability for state and local governments and that a new public employee classification is vital to the state's fiscal wellness. That remains to be seen.

Senate Democratic Conference Leader John Sampson said in a press release this legislation is an absolute necessity for putting our fiscal house on sound footing. He added, "The Tier V reforms represent a major step forward to help bring pension costs under control.”

Critics argue that creating a new Tier does nothing to immediately address the fiscal woes of the state. In a September 27 Huffington Post article titled, Tier V: Part of the Universal Conspiracy on Pensions, a Room Eight author says this bill adds greed to greed without understanding what it might do to vital public services New York citizens expect and deserve.

CSEA WNY Region 6 President Flo Tripi says, "We made an agreement with the Governor back in late spring not to oppose a Tier V. Do we like it? No. Did we want this to happen? No. However, when you are balancing the lives of 9,000 workers who might be let go against the Tier V system for new employees, it was a concession in the best interest of CSEA and the state."

Tripi also states that negotiations will be made to improve the retiree benefits of the new Tier V employees represented by CSEA, if any are hired at all. She added, "This bill is completely unfair to new workers who will be paying into a system that won't reward them for many years to come. Lawmakers don't want to be asked how this bill could possibly help this present fiscal disaster that is going to gut public services, given the fact that we will probably not see any new hires for quite some time anyway."

Many pundits also contend that the only reason the Equal Marriage Bill came up for a vote in the Senate on the same day as the deficit reduction plan is to deflect any attention away from the serious consequences of passing such drastic legislation. Watch the senate marriage debate here.
Lawmakers would prefer answering constituient questions about how they voted on the marriage bill rather than address how and why vital services continue to erode around us. Additionally, legislators also do not want the public to ask them about the debate that didn't occur. Here we have a current generation of lawmakers who basically stuck their finger in the eyeball of every future CSEA member in New York State.
Major elements of the plan include:
*$1.6 billion in cuts and temporary cash transfers from agencies to the general fund, already ordered by Governor Paterson. The cuts include 11 percent to most state agencies, which are asked to avoid layoffs.

*$391 million in federal stimulus funds for education that will not be dispersed. These funds were targeted for fiscal year 2010-2011.

*$250 million projected to be collected under a new tax amnesty program.

*More than $600 million in cuts to several programs, including healthcare, that supposedly will not eliminate jobs.

*The plan also includes some so-called revenue raisers, including $200 million anticipated from video slot machines at Aqueduct race track.

Paterson complained that the legislature rejected the toughest measures. He said that lawmakers are afraid of the "powerful" public employee unions who are protecting their turf.

The legislation also puts a cap on the amount of overtime that can be used in calculating pension benefits. Pension payments are traditionally based on an employee’s final average salary.

These changes do not affect existing employees because of state constitutional prohibitions against reduction of benefits for existing pension system members.