Tom Henry and controller commander Pat Roller are screaming poor and are proposing to freeze city employee salaries. They’ve never mentioned the relief the state is giving them on the following issue.
From the city web site.
The shortfall comes from a public safety pension fund for firefighters and police officers hired before 1977. As a State Senator in the 1970’s, Mayor Richard worked to pass legislation that created a fully funded plan for public safety workers hired after 1977. That fund remains self supporting. However, the pension shortfall from the old plan still exists.
The City pays $7.5 million each year to fund the pre-1977 plan, which as of December 31, 2005 had an unfunded liability of $214 million. The State is set to drop its guaranteed 50% cost share of the plan in 2009. The amount the City owes is in excess of two years of property taxes. In addition, a new law prevents cities from raising taxes to pay for pensions.
Not true.
I spoke with Tim Berry, Indiana Auditor of State about this earlier this week. The state of Indiana is paying 100% of the pre-1977 liability starting in 2009, contrary to what the city web site states.
HB 1001 states the following:
Provides that in 2009 and each year thereafter, the state pension relief fund shall pay to each unit of local government the total amount of pension, disability, and survivor benefit payments from the old police and firefighter funds by the unit.
That’s a $7.5 million annual windfall for the city, or almost a quarter of a billion dollars in total. Funny, no one at city hall is mentioning this.
AWB
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Dan,
That news release was dated August 29, 2006!
Your post makes it sound like it’s from the Henry administration but it’s almost two years old and was released well before HB1001 was even a thought in anyone’s mind.
The controller has mentioned the pension takeover in more than one newspaper article…
Jeff,
I looked, I could not find anywhere where Roller mentioned the state taking over the liability. Also, if that’s old and no longer valid information, it should be taken OFF the city’s web site.
I have to agree with AWB on this one. If the information is no longer true, why does the city have it on their website and why has no one from the mayor’s office patted the state on the back for taking over the liability? Perhaps they don’t want anyone to know…………
Dan:
Shouldn’t that be “King” Henry, & Duchess Roller of the County of Control?
(besides, isn’t the city ALSO due some $$$ from a utility payoff thing in 2009? I recall a few million THERE too)
B.G.
I would be interested in the analysis from Ron Renking and Mike Sylvester on this issue. As I recall, one or both of them did an analysis of the City’s obligations last year and the resulting annual budget implications. If what the State Auditor has said is indeed true and this obligation is included in the implementation of HB1001, what does the City’s balance sheet and income statement look like as a result?
Squarefinger …
Although it looks to be true at times, Governments do not have Income Statements or Balance sheets. Non-profits such as the city government use an accounting system known as Fund Accounting to tie income and expenditures to authorized programs to assure control. Having said that, I shake my head over the liberties taken with Harrison Square.
Must be the reason we have a City Controller.