1 Victory on Local Pensions, 5 Battles to Watch
Pension battles are heating up in cities across the nation as conservatives and Republicans are pushing to strip public workers of their retirement plans, often with little or nothing offered as a replacement. The primary argument, although a false one, is that these pensions are "too expensive" and that during times of fiscal woes, cities can't afford them. In reality, these plans are often little more than veiled attempts to abandon commitments to workers and shift spending to more conservative priorities.
Working families had a victory in Tucson, Ariz., this month when a judge threw an initiative off the November ballot after it was determined that many of the required signatures gathered to put the question before the voters were improperly gathered. The initiative would've eliminated the city's pension plan and replaced it with a 401(k)-style plan.
While there was a victory for working families in Arizona, pension plans in numerous other cities aren't quite as safe. Here are five cities to watch as pension plans become a more prominent target of conservatives:
1. Cincinnati : A group of mostly out-of-state tea party activists, including the Liberty Initiative Fund from Virginia, succeeded in gathering enough signatures to put an initiative on the Nov. 5 ballot that is very similar to the one that just failed in Tucson. The plan, if passed, would eliminate the city's pension fund for any future hires, replacing it with 401(k)-style private funds directed by individual employees, effectively privatizing the pension system. Many of the city employees who would be in the new plans are not eligible for Social Security and would have no safety net to fall back on if the stock market did poorly or they failed to successfully manage their new accounts.
2. Jacksonville, Fla. : The Pew Charitable Trust is partnering with the John & Laura Arnold Foundation and is expected to promote what is called a "cash balance" plan to replace the city's current pension plan. If the plan mirrors what Pew proposed in Kentucky, it would amount to a significant reduction in retirement savings for future retirees, who would get a set cash amount based on years of service. This measure has not been officially proposed yet.
3. Memphis, Tenn. : The mayor's office is proposing a series of pension changes that the local Fire Fighters ( IAFF ) call a barrage of attacks on workers. The proposed changes include setting a minimum age to receive retirement benefits, reducing benefits for employees who take early retirement and using a salary average to determine pension benefits.
4. Phoenix : Citizens for Pension Reform is gathering signatures for a ballot initiative that would switch the city's pension plan from a defined-benefit plan to a defined-contribution plan and capping potential benefits for current employees. The switch, similar to the proposals in other cities, would amount to a benefit cut.
5. Tulsa, Okla. : The mayor is also suggesting making the change from a defined-benefit plan to a defined-contribution plan. The change would affect only new employees and would not include firefighters or police, who are enrolled in a state-managed retirement system.
