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Pension Reform Possible in Cincinnati
Voters in the city of Cincinnati will be asked to approve changes to the city's beleaguered pension fund when they go to the polls this November.
Officials with the Hamilton Co. Board of Elections said Monday supporters of the amendment collected more than enough signatures to place a charter amendment on ballot.
The amendment would end pensions for new city employees and implement retirement accounts similar to 401 (k)'s. Cost of living increases for current retirees would be capped at 3% annually and an independent audit of the pension would be conducted annually. The amendment would require city officials to find funds to pay for future benefits.
The pension has unfunded liabilities of $862 million.
"As a citizen, as somebody who's lived in Cincinnati most of my life, I love this city and I do not want to see it go bankrupt like Detroit," said Gary Greenberg, an attorney who supports the amendment.
Greenberg blames city officials for the pension problems. He says current retirees would likely not be affected. But, current city employees may be.
"Future accruals, what they earn toward their retirement benefits from 2014 on could be less. And the reason for that is to keep our city from going bankrupt," Greenberg said.
Bernadette Watson worked for the city for more than a decade. Since she and her husband worked for the city, they did not contribute to social security, so their benefit from that federal program is minimal. They largely rely on their monthly pension checks.
"It provides our life. It has been very difficult more so than the money, the benefits were so very important to us especially as we got older,' Watson said.
Watson said she is not happy about the way the city has managed the pension. But, she believes the charter amendment could make matters worse.
Cincinnati city council unanimously passed a resolution opposing the charter amendment. City officials have said the changes the amendment calls for would cost the city more in the long run.
"If reforming does not make things better, then reforming is not something you need to do," Watson said. Bentley Davis of the Ohio Alliance for Retired Americans said her group will campaign against the amendment.
Cincinnati mayoral candidates Roxanne Qualls and John Cranley oppose the amendment. In a statement, Qualls called it "a wolf in sheep's clothing" and urged voters to strike it down.
Cranley said, "The pension proposal is unfair to retirees and worsens the deficit. Ending the pension plan altogether means that obligations will be paid by fewer and fewer people, which compounds the liability. Additionally, it may cost the City its exemption from Social Security, which will also cost taxpayers more."
Cincinnati police and firefighters' pensions would not be impacted by the amendment. They are in a state pension system.