Here we go again. Some Florida cities going bankrupt because of union pensions

From the Sun Sentinel:

After more than two decades working in Miami Beach’s 911 call center, Pamela Kindle wanted her golden parachute.

Her $60,000-a-year job would provide a modest pension for retirement, but Kindle wanted more. So, she launched into a “marathon” of overtime, racking up an extra 50 hours of work a week during her final two years on the job.

When she retired in 2002, Kindle did so with a $150,000 taxpayer-supported pension. Yearly increases have pumped up her pension to more than $182,000.

"I earned my money," said Kindle, 63, who says the city helped create her pension by perennially understaffing the call center. "I worked hard."

By the time she reaches her mid-70s, the city’s pension fund will have paid her $4,074,000 in her golden years.

…The deals were agreed to by elected officials in negotiations with politically potent employee unions — especially police and fire unions, whose members face the biggest risks but enjoy higher pay and better benefits.

During the real estate boom, there was plenty of money for pay raises and perks, even as employers in the private sector were ratcheting down health benefits and phasing out traditional pensions in favor of self-funded 401(k) plans.

Then it all went sour.

Cities, financially kneecapped by plunging property-tax revenues, stock market reversals and their own generosity, found pension costs eating up a rapidly growing chunk of their operating budgets — one out of every five dollars in Miami Beach, one out of four in Hollywood.

Those cities and others are now trying to take back what they promised. That has sent employees rushing toward the exits. A year ago, as pay and pension reductions imposed by Miami’s elected officials were about to take effect, more than 250 employees retired on the same day. The same thing is happening in Hollywood, where voters last week approved dramatic reductions in employee pensions.

…How generous are city pensions? More generous than pensions paid through the state’s retirement system, although the state has hundreds of six-figure pensioners. The Florida Retirement System, likened to a millstone weighing down the state budget, last year paid out an average yearly retirement benefit of $18,000.

By contrast:

• In Miami Beach, of the 38 police and firefighters who began receiving a pension in fiscal year 2009, 26 did so in their 40s with an average retirement benefit of $104,000 — and a promised annual increase of 2.5 percent.

Read the Rest (it gets worse)

How did we get here? I find myself asking that question so often lately. I have my theories. Maybe it’s because it’s become out of bounds to even suggest that a teacher or other public worker isn’t worth what they’re being paid. Or maybe it’s because of the harsh tactics and deep pockets of public sector unions, which are much more concerned with lining those pockets rather than being reasonable where pensions are concerned. Or may be it’s the politicians who promise outrageous things to bribe people to vote for them. They know they’ll be long gone before the well has run dry. Whatever the reason, it’s got to stop or I’m afraid Benjamin Franklin’s words will come true: "When the people find they can vote themselves money, that will herald the end of the republic."

Recent Comments