Mayor Peduto: Pension Recommendations A Good First Step
Following the release of recommendations from Gov. Tom Wolf’s Task Force on Municipal Pensions, Pittsburgh Mayor Bill Peduto said that while the recommendations do not contain every pension change he’d like to see, it’s an important start.
“We wanted to see some movement on a hybrid model, defined benefit plan, and perhaps reform state Act 205 which gives funding to cities with distressed pension plans like Pittsburgh,” said Peduto’s spokesman Tim McNulty, “but, it was an important first step.”
The task force’s plan would, among other things, increase transparency and accountability surrounding pensions and try to improve funding levels for distressed pensions. Recommendations include increasing penalties when a municipality doesn’t pay its full pension obligation and taking pensions out of collective bargaining. In a statement, Peduto said many of the recommendations have already been adopted in Pittsburgh.
“Not every city pays its full minimum obligation to its employees, the City of Pittsburgh does; in fact we pay more than we have to.” said McNulty, “So, we’re doing ok but we still have a long way to go when it comes to improving our pensions.”
Peduto also said he was also pleased to see anti-spiking provisions in the recommendations, but would oppose any efforts to address pension problems through “further privatization of city assets or issuing pension bonds. The mayor’s office said one of the main positives is the buy-in from officials.
“It’s really important that really for the first time, everybody’s coming to the table on this incredibly important issue,” said McNulty. “The governor, the auditor general, Republicans, Democrats, business groups, labor – we all know that this is something that has to be fixed for cities, not just Pittsburgh, but cities all across the state.”
For Pittsburgh, McNulty said the pension issue is costing the city billions of dollars and won’t improve without action. He said that even with the changes made to Pittsburgh’s pensions, the fund is still only about 57 percent funded.
“We have to do better,” he said.