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Why not simply tax pensions, make them pay a higher % of their benefits, and lower their pay (especially for teachers, school administrators, and law enforcement)?
No need to sub-contract or call a ConCon.
Frankly that's asking a lot, and targeting just a small group.
However minus a huge 20% pay cut, which won't (and shouldn't) happen.
Simply taxing pensions, and raising the % new employees put in, won't turn these systems over.
It will put more money in NYS coffers, but only a little into the retirement systems.
The majority of employees now are Tier 3 and 4. What they put in is set and fixed. Tier 5 employees put in the most, but make up less than 2% of the NYS public benefit workforce.
If you were to ask for more from a Tier 6 (which they have, and is terribly unfair) you're still collecting from a TINY percentage of people.
Whatever changes are made now, are -too- late.
Somehow past employees with state contractually guaranteed pensions have to be targeted, not the current workforce.
Tier 5, which is the current tier of NYS employees, does require contributions for the entire career.
It's NOT Tier 5 that's the problem. No Tier 4 or 5 employees are vested enough yet to be drawing from payouts- and if the system continues to see decent turnarounds on it's money, those putting in 3.5% for their career will likely end up retrieving nearly an equal sum back (after what is matched by state).
It is Tier's 1 and 2 that were told they could put in NOTHING their career, and take out for years and years beyond what anyone thought life expectancy was in 1945.
Essentially, these retirees are protected from ANY situation minus a change in the state constitution, or the state tax code which allows taxing of public pensions.
This is the problem at hand. It is fairly a clear issue, that for some reason falls off the table from any political banter.
I realize it's hard to say we should demonize teachers, police officers, or civil servants, or to demand something back from them- but the only other solution is to retroactively demand something from those who drafted these contracts and business plans.
Guess what... they're all dead now.
The other solution, would be to have current civil servants put in 20% of their salaries, but when they retire in 40 years, we will give them $1,000,000 a year pensions, and full health care benefits.
They'd likely put in, and our systems would be rich with money again, and 40 years from now we'd be faced with a huge payout problem... but it would certainly roll the current predicament over for 40 years.
This is exactly what happened to us.
I understand what you're saying, but how many 1 & 2's are still collecting and how big are their pensions. I would think that unless they retired in the last ten years as a teacher or law enforcemnet, those pensions are pretty small. I think the bigger problem is the pensions that are being paid out on todays higher salaries, with the employee having only paid in for ten years. (or in the case of some PD's,never)
Changes are necessary to sustain the system, but I don't think you need to throw out the baby with the bathwater. JMHO
I understand what you're saying, but how many 1 & 2's are still collecting and how big are their pensions. I would think that unless they retired in the last ten years as a teacher or law enforcemnet, those pensions are pretty small. I think the bigger problem is the pensions that are being paid out on todays higher salaries, with the employee having only paid in for ten years. (or in the case of some PD's,never)
Changes are necessary to sustain the system, but I don't think you need to throw out the baby with the bathwater. JMHO
While their salaries aren't weren't as high as they are today-
a large number of them, plus the skyrocketing costs of healthcare add up.
Tens of thousands of Tier 1 and Tier 2 employees are collecting.
They are pretty much the only people collecting.
As tier 2 ended in the late 1970s, Tier 3 and beyond employees would only be at 35 years appx. now. Many just getting ready for retirement.
Please correct me if I am wrong, but aren't the taxpayers on the hook for making up shortfalls in the (teachers?) pension system caused by the bad economy and lower returns?
Please correct me if I am wrong, but aren't the taxpayers on the hook for making up shortfalls in the (teachers?) pension system caused by the bad economy and lower returns?
Correct. According to contract if the pension fund doesn't make some absurd percentage from the market the taxpayers make up the difference.
While their salaries aren't weren't as high as they are today-
a large number of them, plus the skyrocketing costs of healthcare add up.
Tens of thousands of Tier 1 and Tier 2 employees are collecting.
They are pretty much the only people collecting.
As tier 2 ended in the late 1970s, Tier 3 and beyond employees would only be at 35 years appx. now. Many just getting ready for retirement.
The $20k pension isn't the big problem here. The big issues stressing the system are, in no particular order :
1.poor market returns.
2.higher pensions combined with flat employee contribution rates.
3.longer life expectancy.
4.the contribution holiday that municipalities took when the market was soaring. A constant rate of contribution, even during good times would have absorbed a great portion of this down market.
While their salaries aren't weren't as high as they are today-
a large number of them, plus the skyrocketing costs of healthcare add up.
Tens of thousands of Tier 1 and Tier 2 employees are collecting.
They are pretty much the only people collecting.
As tier 2 ended in the late 1970s, Tier 3 and beyond employees would only be at 35 years appx. now. Many just getting ready for retirement.
^^ yes
When people are railing against "public employees", the reality is that the core issue is with those already retired or about to retire. Bleeding recent and future hires more and more is just compounding an already horrible situation while not fixing anything.
I'm not looking to get ambushed but the way I see it, Long island needs to trim the layers of local government. We don't require multiple school districts/water authority/busing/police/firemen. Whether anyone on this board agrees. We need teachers,policemen,firemen, sanitation workers. We dont need a multitude of adminstrations to do it. I'm not gonna say anything negative about people but how many superintendants etc. do we need. We only need one governing body here on long island, it is the only way to make any noticable change.......
BadAndyHolbrook, when combining two or more districts that have differing contracts with their respective unions, the unions adamantly argue for a leveling up to the highest wages and pensions paid in any of the districts.
I'm not looking to get ambushed but the way I see it, Long island needs to trim the layers of local government. We don't require multiple school districts/water authority/busing/police/firemen. Whether anyone on this board agrees. We need teachers,policemen,firemen, sanitation workers. We dont need a multitude of adminstrations to do it. I'm not gonna say anything negative about people but how many superintendants etc. do we need. We only need one governing body here on long island, it is the only way to make any noticable change.......
While there is always more of an efficient way to go about things- it's not the root of the problem at all.
The problem stems from a retirement pension system that is essentially a pyramid scheme. The people at the top put nothing in, and the pyramid must continue to see growth to make payouts.
The system we have been working with since it's inception does not work.
Many people on here cite poor returns from the investments, but that for the most part isn't the case- NYS retirement systems are generally incredibly well in the market. Clearly not as good now as it was, but overall have gone well above and beyond the target goal of investments.
BUT... when you're getting an 11% return on the $0 dollars you put in.
Guess what...
We have to pay the pensions of Tier 1 and Tier 2, with the past contributions of their employers, and the current contributions Tier 3-5, and it simply isn't enough. Thus the pensions get drawn from general accounts which hurts the current hiring, which hurts the services of the taxpayers.
No reform at the bottom will make up for the issue at the top of the Pyrmaid... and if there was a reform at the bottom, such as 25% paycuts and 10% contributions- it would be completely saying F* You to an entire generation of employees, once again at the benefit baby boomers.
.... so that's probably what will happen.
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