St. Louis city is launching another battle over local control ...this time of the city's Fire Department Pension Fund. Currently it is part of a state supervised system and any changes must first be authorized by the Missouri Legislature before the St. Louis Board of Aldermen can vote the change up or down.
Soaring pension costs have Mayor Francis Slay seeking control of rules that govern pension contributions and distribution. Reports of disabled firefighters working physical jobs while still accepting disability pensions raise questions about how pensions funds are being spent.
Thursday the Missouri Legislature's Joint Committee on Public Employee Retirement called an informational meeting to hear from both Slay's administration and the International Association of Fire Fighter's Local 73. An attorney representing the Fire Department's Pension Fund also testified.
Both the city officials and the union agree pension costs need to be better controlled so the system remains viable.
"We've seen increasing costs over time, especially the last ten years as the economy has suffered," said St. Louis City Operations Director Sam Dotson. Poor performance in the stock market in the last decade forced the city to make up the difference required by law to keep the pension fund adquately financed.
In addition, more and more fire fighters are retiring early on disability pensions. Currently 44 percent of the retirees are on accidental disability and three percent on ordinary or not job related disability.
But the Fire Fighter's Union President Chris Molitor argues the state umbrella needs to remain in place. "They illegally and knowingly underfunded our system from 2003 to 2007 and lost a unanimous decision in the Missouri Supreme Court that said they had to pay it," he said. After that experience firefighters believe they need a system of checks and balances to protect their retirement fund.
Mayor Slay is proposing changes that would stop newly hired fire fighters from taking their pension contributions in a lump sum upon retirement. Employee contributions would increase to nine percent of pay from the current eight percent.
"We're not trying to cut benefits for existing firefighters; we're not trying to cut benefits for retirees," said Dotson. "We're trying to have a system that is sustainable."
Republican State Rep. Mike Leara of Sunset Hills introduced House Bill 1857 this week in hopes of reaching a compromise between Slay and the union. Leara says he represents several retired fire fighters who now live in South St. Louis County.
"I'm not trying to get in the middle of a fight between political foes, but I do want to move legislation that would save the taxpayers money and the city and not decimate the pension system for the firefighters," Leara explained. However, he agreed changes need to be made in the management of disability pensions. Recent news reports identified some disabled fire fighters who currently work at jobs requiring physical activity. They collect a tax free pension and the job salary.
Critics of Leara's bill say it is what the fire fighter's union wants and not a compromise.
For a copy of the bill click here