Local departments concerned for officers nearing retirement
Local police and municipal officials weighed in Tuesday on new proposals in pension reforms for municipal police and paid firefighters.
State Rep. Seth Grove (R-196), York, has proposed placing new hires under a cash balance pension plan rather than a defined benefit system (see separate story).
Coal Township Manager Rob Slaby said the amount Coal Township spends from its general fund for the police pension is less than 1 percent of its annual general fund, about $8,000 of its $2.7 million budget.
"That comes after we receive state aid to help pay for it, and use funds from a 1/2 mill tax for pension payments that we assess," Slaby said.
Coal Township Police Chief William Carpenter said he doesn't have enough information about the proposed legislation to offer an opinion.
"I'd like to hear projections from people who understand 401(k) plans better than I do. I'd have to see some real numbers to see how it would affect new officers," he said.
Shamokin Police Chief Edward Griffiths doesn't oppose the legislation as it applies to new hires, but believes officers invested in a pension plan for 10 or 15 years shouldn't be subjected to any changes while they get closer to retirement.
"At least prospective officers will know what they are getting up front with their pension plans before making a decision about becoming a municipal police officer," Griffiths said.
The chief said he understands why officials in poor economic communities like Shamokin seek ways to save money on pensions plans.
Mount Carmel Chief of Police Todd Owens agrees with Griffiths that veteran officers shouldn't have to worry about their pension benefits being reduced as they approach retirement.
"I really didn't hear anything about the proposed legislation, but I hope it wouldn't adversely affect the officers who are close to retirement," Owens said.
As for new officers, Owens said he doesn't see a problem as long as they clearly understand the benefits they will receive under a cash balance pension plan.
Owens understands that the local economic climate forces municipal officials to try to minimize Minimum Municipal Obligation (MMO) contributions.
"For the taxpayers, switching to the cash benefit or a 401(k) plan for pensions is beneficial," said Mount Carmel Borough Council President Tony Matulewicz. "In Mount Carmel, $208,000 of our $1.7 million budget goes toward pensions, and we are very underfunded, by about $700,000. If we keep adding people to the current plan, we will break the system."
As long as current employees get what is coming to them, Matulewicz said he is willing to look into ways to reform the system to save money.
Kulpmont Mayor Myron Turlis hopes reform is helpful and that it could be a pilot program for state pension reforms.
"The defined benefits plan is the reason the state is in the mess it is in now. As long as there is no negative affect to employees and everyone gets the benefits they are entitled to, I don't see a problem with any pension plan reform."
Kulpmont finds itself in an enviable position because they have a very low contribution.
"We only have one full-time officer on the payroll, and we provide a pension for him," he said. "The rest of our officers are part-time and aren't eligible for benefits."