The tea party-backed amendment that would semi-privatize Cincinnati’s ailing pension system gathered enough signatures earn a place on the November ballot.
Of 14,215 signatures scrutinized so far, 8,653 were valid, according to Sally Krisel, deputy director of the Hamilton County Board of Elections. That clears the requirement of 7,443 signatures, but the numbers will grow as the board continues counting petitions.
The success follows a well-funded effort from Cincinnati for Pension Reform, which paid California-based Arno Petition Consultants nearly $70,000 to collect enough signatures, according to petition documents obtained through the city.
The amendment would privatize pension plans so city employees hired after January 2014 contribute to and manage their own retirement accounts — a shift from the current set-up in which the city pools pension funds and manages the investments through an independent board.
But unlike private-sector employees, city workers might not qualify for Social Security benefits, which means they would lack the safety net and benefits that shield them from bad investments.
Alternatively, the city could be required to pay into Social Security.
Supporters of the tea party amendment say it’s necessary because Cincinnati is dragging its feet in addressing an $862 million pension liability, which earned the city a downgraded bond rating from Moody’s in a July 15 report. Although the city passed reforms in 2011 addressing future pension costs, the unfunded liability actually grew by $134 million between 2012 and 2013.
The Cincinnati Retirement System board is working on changes that would address the unfunded liability, but so far no agreement has been reached as board members argue over whether taxpayers or retirees should be hit hardest by more cost-cutting measures.
City officials acknowledge the issues with the current pension system, but they claim the tea party-backed amendment would exacerbate cost problems and reduce payments to future city retirees.
“Under the guise of ‘reform,’ a well-financed out-of-state group is pushing an amendment that spells economic disaster for the future city retirees and the city’s budget,” Vice Mayor Roxanne Qualls said in a statement. “Current and future retirees need an income they can live on. This amendment is a budget-buster for retirees and the city.”
City Council condemned the amendment in a resolution unanimously passed on Aug. 7.
CityBeat’s Aug. 14 news story will give an in-depth look at the amendment and the campaign behind it.
This story was updated at 5:07 p.m. with the most up-to-date numbers.