NY Times, December 22, 2008
On Pension Proposals, Paterson Takes Tactic From the Past
By CHARLES DELAFUENTE
When Gov. David A. Paterson proposed reducing pension benefits for new
city and state employees last week, he was reaching into the past for an
idea that was used to rescue the city from the fiscal crisis of the
1970s. But that idea — both then and now — generated immediate and
vehement opposition from powerful unions.
Dealing with New York City’s brush with insolvency and bankruptcy a
third of a century ago, the Legislature — over the bitter opposition of
municipal labor union leaders — rewrote the laws governing employees of
the city, the state and other local governments. The changes, enacted in
1976 and signed by Gov. Hugh L. Carey, ended an era in which government
employers provided all the contributions that would pay retirement benefits.
Workers hired after July 26, 1976, had to contribute 3 percent of their
salary to help pay for their benefits. In pension parlance, they were in
a new category, known as Tier 3 employees. The changes were part of the
bailout plan to rescue the city, which was teetering on the brink of
insolvency.
The union leaders who opposed the changes — including municipal union
giants like Albert Shanker and Victor Gotbaum — fought hard to repeal
them. The law was significantly revised in 1983 to limit employees’
contributions — but only for workers who were then on the payroll.
People hired on or after Sept. 1, 1983, got the less-generous formula in
effect before Tier 3 was revised — and they became Tier 4 workers.
The union leaders pushed for repeal of Tier 3 because, as Melvyn
Aaronson, the treasurer of the United Federation of Teachers, said, the
revised pensions were “foisted on us.” In his view, the different tiers
“created a huge problem in all of city government.”
Mr. Aaronson, a municipal pension expert who remembers the 1976
legislative action well, said that “if two teachers were teaching next
door to each other and one was covered by a superior pension plan and
one by this inferior plan, that created jealousies. It didn’t work.”
The tier concept can be used over and over, locking in varying levels of
pension benefits and retirement eligibility for employees hired at
different times. But even then, any savings to government can be eroded,
because changes are always subject to repeal or to bit-by-bit
modification in negotiations, or through the Legislature.
Under the proposals the governor made last week, nonuniformed state and
local government workers hired after the legislation was passed would,
generally, pay 3 percent from the day they were hired until the day they
retired. They would have to be at least age 62 to draw pension benefits.
The governor also offered separate provisions for uniformed New York
City workers, who were not covered by the 1976 changes.
Uniformed workers — police officers, firefighters, correction officers
and sanitation workers — hired in the future would have to work for 25
years and be 50 to qualify for full pensions. They can now retire with
full pensions after 20 years, regardless of age.
And new city uniformed employees would have to contribute 5 percent of
their salaries until they have 25 years of service — a significant
increase above what current workers pay.
Mr. Paterson said the changes were essential. “We’ve made too many
promises and asked for too few sacrifices,” he said.
And Mayor Michael R. Bloomberg called the city pension system “one of
those areas where spending has grown to an unaffordable rate. And we
simply have to find a way to rein it in.”
Like their predecessors who opposed the 1976 changes, today’s municipal
labor leaders do not like the current proposals. Patrick J. Lynch, the
president of the Patrolmen’s Benevolent Association, said the city paid
less than the market rate for officers “because of the promise of
stability and a fair pension.”
He added, “Remove those incentives and no one will want to take the
risks or suffer the physical and mental toll those jobs inflict.”
Randi Weingarten, the president of the United Federation of Teachers,
called the pension proposals “essentially a de facto reopening of a
contract unilaterally to cut wages,” since it would require future
teachers to continue contributing 3 percent of their pay for more than
10 years.
While Mr. Aaronson, who was involved in the 1976 battle, called those
changes “draconian,” he recalled that he was especially taken aback that
they affected state workers, too. “The city was in greater financial
trouble, but the state piggybacked,” he said.
---
NY Times, December 22, 2008
Paterson Visits Troops in Iraq, and Cites Surge Progress
By JEREMY W. PETERS
Gov. David A. Paterson visited American troops and officials in Iraq on
Sunday with members of a Congressional delegation that included other
New York lawmakers.
Details of the trip were kept tightly under wraps by the governor’s
office until Sunday morning, when Mr. Paterson was already on the
ground. The visit, Mr. Paterson’s first to the country, was a whirlwind
of meals with soldiers from New York and introductions to senior
military officials like Lt. Gen. Frank Helmick, the official in charge
of training and equipping Iraqi troops. The governor was scheduled to
meet on Monday with Ryan C. Crocker, the United States ambassador to Iraq.
Mr. Paterson joined four congressmen, Steve Israel and Anthony D.
Weiner, both New York Democrats; Tom Cole, Republican of Oklahoma; and
Edward Whitfield, Republican of Kentucky. The men flew out of Andrews
Air Force Base near Washington on Friday and arrived in Baghdad at about
1 a.m. Eastern time on Sunday, making numerous undisclosed stops along
the way. Aides to the officials would not say how long they were
staying, citing security concerns.
Mr. Paterson, who in his capacity as governor commands the state’s
Division of Military and Naval Affairs, largely steered clear of
criticizing the Bush administration’s foreign policy in Iraq and
declined to say when he felt the American troops deployed there should
return. When asked if he favored a quick withdrawal, he said he would
support President-elect Barack Obama in whatever he decided to do.
“I trust that they are making the right decision,” Mr. Paterson said on
a conference call from Baghdad, adding, “And I’m sure that part of the
decision is that you would never want anyone that you may be in conflict
with to know exactly when you’re leaving.”
Mr. Weiner and Mr. Israel joined Mr. Paterson on the call, which they
made from a palace formerly occupied by Saddam Hussein.
Mr. Paterson noted that the successes of the Bush administration’s
escalation of military force in Iraq, known as the surge, were evident
to him. Referring to American forces’ achievements in strengthening
military security and political freedom, he said, “They, particularly in
the last 18 months, turned this whole conflict around.” He added: “And I
don’t think I understood that as well as I have in the past few days.”
Mr. Weiner, who has visited Baghdad before, said, “This country has been
ravaged.” He added, “We take solace in the small steps that have been
taken to make thing better here, but it’s hard not to walk around the
streets of Baghdad in particular and be a little depressed about it.”
Officials involved in the planning of the trip said that it had been in
the works for months. It was organized with the help of Mr. Weiner and
Mr. Israel in October, and Mr. Paterson had always planned to attend,
according to Lindsay Hamilton, a spokeswoman for Mr. Israel.
Even in Iraq, Mr. Paterson could not escape the question that has been
asked of him repeatedly in the last month since it became known that
Senator Hillary Rodham Clinton would accept the position of Mr. Obama’s
secretary of state.
Mr. Paterson said of soldiers he had met on the trip, “Five of six of
them asked me who the new senator is.”
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