Mayor Bloomberg broadened his challenge to city workers' unions by
proposing the elimination of the annual $12,000 bonus for current
police and fire retirees and workers as part of an overall plan to create
a new tier of less generous benefits for future workers.
Union official accused the mayor of trying to damage the work force's
hard-fought pension system.
Last month, Mayor Bloomberg outlined his plans to rein in the City's
exhaustive pension costs which have skyrocketed to $7 billion this
year compared to $1.5 billion in 2001.
The proposal reflects the dire circumstances facing NYC and the
devasting impact of increasing pension costs and especially, the
deperate need for reform. Simply put - NYC just doesn't have the
money to pay for it.
The elimination of the bonuse would save NYC $200 billion a year.
At the heart of the mayor's pension proposal is his appeal to create
a new penison tier with fewer benefits. These proposals would
eliminate things like altering the amount of time it takes an
employee to become vested by extending the years from five to ten;
increasing employee contribution to the pension system and
disallowing overtime in the final salary calculation toward pension
benefit.
So much reform in clearly needed across so many NYC Budget
expense line items. It appears that Mayor Bloomberg is approaching
expence cutting the right way by clearly and carefully analyzing
the spend of the City. We will see many more proposal to follow.
SMART MONEY RULE #6: ANALYZE ALL OF YOUR SPEND TO
SEE IF THOSE DOLLARS COULD BE
BETTER USED TOWARDS OTHER
FINANCIAL GOALS.
Sheila McKinney
