STUMP » Articles » Public Pension Watch: Living high on the hog in New York » 2 August 2014, 02:16

Where Stu & MP spout off about everything.

Public Pension Watch: Living high on the hog in New York  

by

2 August 2014, 02:16

I have a bunch of “Are so-and-so underpaid?” posts bubbling in my mind, but it requires a lot of original typing and I can’t do that right now.

So let’s do a copy-and-paste whirlwind of NY pension stories! Scraped from my google news alert and the public pensions thread at the Actuarial Outpost.

First, police officers upstate boosting their pensions by clocking their off-duty work:

Uniformed police officers may be boosting their public pensions by working private details such as a supermarket grand opening, a Walmart Black Friday or crowd control at a rock concert.

The state Comptroller’s Office says overtime reimbursed by a private company does not count toward an officer’s pension benefit.

But the Times Union found that several Capital Region police departments — including those in Colonie, Schenectady and Troy — report private duty overtime to the retirement system.

“I think a lot of people might be surprised to the extent with which this happens around the state,” said E.J. McMahon, president of Empire Center for Public Policy, an Albany think tank. “You can actually bolster your pension with time spent working in uniform on private time.”

Taxpayers should care about the practice, McMahon said, because pensions are lifelong payments backed by taxpayer dollars.

The legality of using private duty details as part of the pension calculation is murky. Several retirees are appealing the comptroller’s position in state Supreme Court.

…..
The issue raises the question of whether a police officer on a private job is acting as a police officer at the public’s benefit or a security guard for a company’s benefit.

“Anytime a man or woman is in police uniform, they are on police duty, period,” Colonie Police Chief Steven Heider said.

Heider considers the officers on-duty, accountable to the police department and exposed to the dangers of police work.

Last year, Colonie police collected about $120,000 in reimbursements from private entities for police details, which Heider said are assigned by rotation. About 40 percent came from patrols at Colonie Center mall.

The town reported the wages to the retirement system as pension eligible.

Next, great news! The NYC pension fund did well in a year equities did well! Ignore upcoming bubble bursting!

The city’s pension funds posted a 17.4% return over the last year — and the city will save billions as a result, Controller Scott Stringer said.

The performance outpaced the 12.1% earned last year and paltry 1.4% in 2012.

The funds now total $160.5 billion, the highest level they’ve ever recorded at the end of a fiscal year, Stringer said.

Over the past five years, they’ve earned an average rate of 13.4%, and peaked in 2011 at 23.2%.

The city will have to contribute less to the funds because they earned more than the 7% return assumed in the budget. The savings could turn out to be $17.8 billion through 2035.

“The city will benefit significantly from the savings generated by these investment returns. Any year in which the pension funds achieve double the assumed rate of return is a good one in my book,” Stringer said.

This is so idiotic, esp. given how much NYC tax revenues depend on the stock market. So years in which the market is down, all those juicy bonuses are down, the tax take is down… and you have to put waaaaaaaay more in the pension.

Put on your dunce cap, NYC.

Their situation is worse than most of the other funds crowing about record returns over the last year. Only Chicago is on a par with dependency on rich guys who go up and down with the market, but probably not that bad. Bloomberg understood this, and Cuomo somewhat understands this.

Smacking down political activity by companies the pensions invest in:

ALBANY, N.Y. — New York’s $176.2 billion pension fund for public workers this year has proposed 29 corporations more thoroughly disclose their political spending.

Three have agreed to do it: Comcast, Peabody Energy and CF Industries.

New York Comptroller Thomas DiNapoli, the fund’s trustee, said Friday the proposal has received majority approval despite board opposition at Valero Energy and Dean Foods. At six others, it got at least one-third support.

The proposal calls for annual reporting of spending on candidates, political parties, ballot measures and direct or indirect state and federal lobbying. It also would require the companies to report spending that goes to any trade associations for political purposes. The resolutions are non-binding but can sway corporate boards to abide by what shareholders call for.

“Spending shareholder dollars on politics can be a risky business. When it’s done in the shadows it may result in spending that is contrary to the company’s long-term interests and cause real damage to a company’s reputation,” DiNapoli said Friday. “We hope and expect that companies will respond to shareholders’ overwhelming desire for disclosure and take the appropriate steps.”

…..
The corporate boards opposed the resolution, saying they already disclose direct political spending on candidates or political action committees and the additional reporting would be mostly redundant and burdensome.

No comment. Make your own.

Let’s see what NY state teachers are up to:

ALBANY — The number of teachers in New York collecting pensions jumped 9 percent between 2010 and 2013, and the average pension grew 6.5 percent over that period, records show.

Teacher pension records had been sealed by the retirement system amid a court fight over whether the details on individual pensioners should be public. The state’s highest court ruled in May that it’s public information.

The data reviewed by Gannett’s Albany Bureau revealed new details about the number of teacher pension recipients in the state and how much they are receiving in retirement.

The pensions also varied significantly by region, ranging from an average of about $34,000 in Ithaca to $60,000 in Yonkers, where the cost of living is much higher, the data show.

A total of 147,156 individuals drew a pension from the Teachers Retirement System in 2013, up from 135,671 in 2010.
…..
More retirements are on the way. In the 2012-13 school year, nearly 13 percent of teachers were aged 57 to 64, so about one of out seven teachers were approaching retirement age, state records showed. Another 19 percent of teachers were aged 49 to 56.

The largest pension went to James Feltman, who retired in 2010 as superintendent of the Commack school district in Suffolk County. He collected $325,854 from the pension fund in 2013. That’s just slightly more than Sheldon Larnilow from Half Hollow Hills on Long Island; he’s receiving a annual pension of $322,650 since his 2011 retirement.

Nearly 2,300 people collected pensions of $100,000 or more. Seventy-one of them retired from the Central Islip schools in Suffolk County, the most of any district in the state.

Statewide, the average pension for school retirees was $41,752 in the 2012-13 school year. It was $39,193 in 2010.

……
The state’s Teachers’ Retirement System missed its expected rate of return of 8 percent over the past five and 10 years. As a result, it has steadily increased contribution rates for school districts.

Pension costs for the state’s roughly 700 school districts rose 37 percent this school year, which started July 1, and will increase 8 percent next school year.

The retirement system has defended its 8 percent rate of return, saying it’s a long-term investor and it remains one of the best-funded plans in the nation.

…..
Between 1993 and last year, the system paid out four times more than what it took in: $17.5 billion came in from member and employer contributions and $73.2 billion was paid out in benefits.

….
E.J McMahon, president of the Empire Center for State Policy in Albany, said the teachers’ pension system is hurt by its lofty rate of return estimates — requiring the system to recoup more from districts to make up the difference with its performance in recent years.

“This is a continuing game of catch up, and we’re still not caught up,” he said. “We may never be caught up.”

And finally, my favorite pension evil (PENSION OBLIGATION BONDS ARE OF THE DEVIL), NY municipalities borrowing to ‘make required pension contributions’:

Municipalities across New York State face myriad financial problems, ranging from flat economic growth and stagnating tax revenues to expensive state mandates. It’s not surprising, then, that dozens of cities, counties, and towns, especially in upstate New York, have embraced a program allowing them to postpone billions of dollars of contributions into the state’s pension system. Unfortunately, the future cost may prove tough to repay. In the last fiscal year, 139 New York municipalities deferred $472 million in retirement-system payments, while the state government skipped another $937 million, according to state comptroller data. Since New York introduced what is euphemistically known as the “contribution-stabilization program” three years ago, governments have put off $3.3 billion in payments—apparently unconcerned that pension underfunding helped propel cities such as Stockton, California, and Detroit into bankruptcy.

The program lets governments “amortize” required payments into the pension plan over a period of ten to 12 years, to slow the budgetary impact of rising retirement costs. Though New York has one of the better-funded government-pension systems, its pension costs have rapidly swelled, thanks to the generous benefits that the state offers and the financial downturn in 2008 and 2009, which increased the system’s unfunded liabilities. Instead of paying off the pension system’s rising debt now, New York governments are borrowing money by deferring required contributions into the future.

I’ve been trying to get the info to see if my town is doing this stuff.

Given I’m fb friends with the town supervisor (and he goes to my church), I may just ask him face-to-face.

Or ask Stu to ask him. But Stu has some other budgetary issues to take up with him. Adding pensions to the mix might be a bit too much.


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