My Fellow “Friends and Unions”

In time of financial crisis our politicians suddenly take interest in the “quality of life,” public security and social services.  Has anyone ever seen an objective analysis of how much “public security” a city needs, at what cost and the number of actual police that are needed to produce it–not in Miami-Dade, I am sure.

In many localities, if police were better organized, had fewer “jefes”, then one could get along with fewer police–that is my hypothesis, but no one wants to raise that question .  We could have fewer police (or the same number of police)  with lower salaries, pensions and other benefits, and still have the same exact amount of public security.  So the issue is not the “budget,” but what government employees should earn during an economic crisis and whether there are groups that are exempt from sacrifices the whole community is making.

Think of this when you read the words of Mayor Alvarez.

Mayor Alvarez came out swinging against Braman at a luncheon Thursday hosted by the South Florida Hispanic Chamber of Commerce, saying his proposed budget was carefully designed to preserve public safety and social service safety nets while holding down spending. Alvarez emphasized that he only proposed the budget, which had to be approved by the commission before being implemented.

via Petition drive launched to recall five Miami-Dade Commissioners – Miami-Dade Breaking News – MiamiHerald.com.

Florida Pension System Better for Taxpayers

A strong reason to transfer municipal employees to the Florida pension system–it is better managed than local funds.

Florida remains well over the minimum 80 percent funding level recommended by experts, according to the Pew Center on the States. In 2008, the state was one of only four to have a fully funded pension system, the Pew Center said in a February report. Its assets fell 21.5 percent to $99.6 billion in the year ended June 2009, according to the annual report of the State Board of Administration. Over the same period, the Standard & Poor’s 500 fell 30 percent.

via Florida employees’ unfunded pension liabilities grew in 2010 – Business Breaking News – MiamiHerald.com.

A Thought on Pensions

I like the following the quotation from a good study on state and local government salaries and pensions.

Note that the pension problem is not really “underfunding,” but the “overpromising” of benefits that the states cannot afford.

It is true that the problem is not that we didn’t tax our people enough, or that the stock market fell, but that city management and commissioners approved pensions (and other benefits) that were and are way too high.

The problem is to correct the original sin–over promising.

Are the Commissioners in the same Family as the Employees?

Thanks to reporting by the Miami Herald we have learned that the City Commissioners have not taken a reduction in their pension accumulation factor of 3 percent during their first ten years of service.  Why wouldn’t the City Commissioners lead the way by reducing their own pension factor to the same as the general employees.  Should they think they are in the same family as the employees?  Commissioners still haven’t shown enough toughness in handling budget, pensions and other benefits (especially health care benefits).

According to the ordinance, the multiplier for non-union pensions would decrease like this:

• Managers, who include commissioners, would keep the 3 percent multiplier for their first 10 years of service. In subsequent years, the multiplier would be reduced to 2.25 percent for every year of service.

• Professionals and supervisors, would have a 2.5 percent pension multiplier for the first 10 years of service, and then a 2.25 percent multiplier for subsequent years of service.

• Commissioners will decide in a few weeks whether or not to change the multiplier for “appointed” employees, such as City Attorney Elizabeth Hernandez and City Clerk Walter Foeman. Salerno does not belong to the non-union pension plan.

via Coral Gables OK’s pension cuts for employees and managers – Coral Gables – MiamiHerald.com.