by German Lopez
70 days ago
Pension proposal could reduce benefits, energy bill contested, needle exchanges approved
Early voting for the 2013 City Council and mayoral elections is now underway. Find your voting location here. Normal voting hours will be 8 a.m. to 4 p.m., although some days will be extended.
Local business groups, unions, progressive organizations,
the mayor and all council members are united against a tea party-backed
ballot initiative that would semi-privatize Cincinnati’s pension system,
and a Sept. 27 report from the conservative Buckeye Institute helps explain the opposition.
The report echoes concerns from both sides: It finds new employees
would have their benefits cut by one-third under the tea party’s
proposed system, but it also shows that, when measured differently,
Cincinnati’s unfunded pension liability might currently stand at $2.57
billion, more than three times the $862 million estimate city officials
typically use. The amendment would privatize Cincinnati’s pension system
so future city employees contribute to and manage their own individual
retirement accounts; under the current system, the city pools pension
funds and manages the investments through an independent board. The idea
is to move workers from a public system to private, 401k-style plans.
Voters will decide on the amendment when it appears on the ballot as
Issue 4 on Nov. 5.
Environmental and business groups argued in front of the Ohio Senate yesterday that a new deregulatory bill would effectively gut Ohio’s energy efficiency standards and hurt the state’s green businesses,
but the bill’s sponsor, State Sen. Bill Seitz (R-Cincinnati), claims
it’s “not as loosey-goosey” as environmental and business groups make it
seem. The biggest point of contention: Seitz’s bill would allow utility
companies to count energy savings that are seen as “business as usual”
toward energy efficiency standards. That, green groups argue, would let
businesses claim they’re becoming more energy efficient without making
any real energy-efficiency investments. It could also cost Ohioans more
money: A previous report from Ohio State University and the Ohio
Advanced Energy Economy coalition found the bill could increase Ohioans’ electricity bills by
$3.65 billion over 12 years. CityBeat covered Seitz’s bill in further detail here and the national conservative groups behind the deregulatory attempts here.
The Ohio House yesterday approved a bill
that expands local authority to pursue needle-exchange programs that
would provide clean needles to drug addicts. Supporters of the bill say
it would help local communities reduce drug-related infections and
perhaps drug addiction, but opponents claim it surrenders to drug pushers by enabling more
drug activity. A 2004 study from the World Health Organization
found “a compelling case that (needle-exchange programs) substantially
and cost effectively reduce the spread of HIV among (injection drug
users) and do so without evidence of exacerbating injecting drug use at
either the individual or societal level.” CityBeat covered the war on drugs and the changing approach to combating Ohio and the nation’s drug problems in further detail here.
Some help for voting: “2013 City Council Candidates at a Glance.”
The Cincinnati Bengals want a new high-definition scoreboard
that could cost county taxpayers $10 million. But taxpayers don’t have
much of a choice in the matter; the stadium lease requires taxpayers
purchase and install new technology, including a scoreboard, at the
Bengals’ request once the technology is taken up at 14-plus other NFL
Women gathered at the Ohio Statehouse
yesterday to protest measures in the recently passed state budget that
restrict access to legal abortions and defund family planning clinics,
including Planned Parenthood. CityBeat covered the state budget, including the anti-abortion restrictions, in further detail here.
U.S. Sen. Rob Portman of Ohio says Republican legislators should forget their fight against Obamacare
and instead focus on a deficit-reduction package. Republicans helped
cause a federal government shutdown by only passing budget bills that
weaken Obamacare, but Democrats have refused to negotiate over the
health care law, which is widely viewed as President Barack Obama’s
legacy-defining domestic policy. Meanwhile, Obamacare’s online
marketplaces opened on Tuesday, allowing participants to compare and
browse subsidized private insurance plans. CityBeat covered the marketplaces and efforts to promote them in further detail here.
The $2.5 billion Brent Spence Bridge replacement project will require tolls,
according to a study released by Kentucky and Ohio transportation
officials on Thursday. Officials at every level of government have been
pursuing a replacement for the Brent Spence Bridge as concerns mount
over its economy-damaging inadequacies.
A $26 million residential and retail development project is coming just north of Cincinnati’s Horseshoe Casino.Greater Cincinnati Water Works is using an extra layer of ultraviolet disinfection treatment to make local water cleaner.
The second round of Ohio’s job training program offers $30 million to help businesses train workers so they can remain competitive without shedding employees.
“Project Censored” analyzes the stories the mainstream media failed to cover in the past year. Check the list out here.
A new study found eye contact makes people less likely to agree with a persuasive argument, especially if they’re skeptical in the first place.
Conservative study suggests tea-party backed pension amendment would reduce benefits
2 Comments · Wednesday, October 2, 2013
A conservative group’s report helps explain why most of Cincinnati’s political establishment strongly opposes a tea party-backed pension amendment.
by German Lopez
75 days ago
Posted In: News
at 04:29 PM | Permalink
Conservative group finds city’s pension liability could be three times current estimate
A Sept. 27 report
from the conservative Buckeye Institute echoes claims made by both
sides in Cincinnati’s pension debate: A tea party-backed amendment, if
approved by voters on Nov. 5, would reduce retirement benefits for new
city employees by one-third. At the same time, the city’s unfunded
pension liability might be three times what officials currently
The Buckeye Institute’s summary of the report vaguely supports the tea party-backed amendment and touts its benefits, but the details and findings in the report are much more mixed.The tea party-backed amendment would privatize Cincinnati’s pension system so city employees hired after January 2014 would contribute to and
manage individual retirement accounts, which would also be supported by
a proportional match from the city. That’s a shift from the current
system in which the city pools pension funds and manages the investments
through an independent board. The idea is to move from a public plan
and instead imitate a 401k plan that’s often seen in the private sector.Opponents of the amendment say it would massively reduce
city benefits and actually increase costs for the city — two issues that the Buckeye
Institute’s report acknowledges as real possibilities.Officials are also concerned that the city would be forced
to pay into Social Security, which would impose additional costs, if
the tea party-backed system isn’t exempt from the federal retirement
program. The current pension system absolves the city government from paying into Social
Security.Supporters of the amendment say the drastic changes are
necessary to help solve the city’s growing pension liability, which city
officials put at $862 million.The Buckeye Institute report argues that even the city
estimates are too low. When pricing the city’s pension liabilities
through fair market value — a measure widely embraced by economists —
the unfunded costs actually stand at $2.57 billion. That puts the pension
system at 35 percent funding, which means the city will have to make up
the 65-percent hole with extra payments.But the report also confirms a key claim for the amendment’s opposition: Future city
employees would get about one-third less benefits under the tea party’s proposed system than they would under
the current pension system.The benefit reductions should save Cincinnati $19.7 million a year, according to the report. But the savings estimate doesn’t consider cost-of-living adjustments, which the report says will rise for future employees and shrink savings over time. The estimate also assumes the tea party’s
proposed system will be able to keep Cincinnati’s Social Security
exemption, which city officials say is unlikely.
Despite the reductions, the Buckeye Institute claims the final benefits will be
better than comparable 401k plans in the private sector, but the
assumption hinges on the city meeting its full contribution to
employees’ individual retirement accounts. The tea party amendment allows — but it doesn’t require —
the city to contribute up to 9 percent of an employee’s salary to retirement accounts. The city
contributes only 2 percent of payroll under the current system, which
is already strained for costs.The report also acknowledges that, if interpreted a
certain way, the tea party amendment could force the city to pay for its
unfunded pension liability in just 10 years, down from 30 years. Paying
the liability that quickly
could prove unmanageable for a city that hasn’t passed a structurally
balanced budget since 2001.
The pension amendment is backed by tea party groups, some of which may reside outside of Cincinnati and Ohio. They argue the reform is necessary to stabilize the city-funded retirement system.
Meanwhile, Cincinnati for Pension Responsibility announced
its formation on Sept. 27 and promised to get voters to oppose a “risky
plan” that “could cost taxpayers millions.” Mayor Mark Mallory, all current council
members, the AFL-CIO, ProgressOhio and other groups have joined the opposition.
Opponents readily acknowledge the current system’s
problems and unfunded liability, but they argue the city would be better
off making reforms within the current system instead of adopting the
tea party’s plan. Some of those reforms are expected to come before City
Council in the next couple months.
Voters will make the final decision on the tea party’s pension amendment when it appears as Issue 4 on the Nov. 5 ballot.
2 Comments · Wednesday, February 23, 2011
It’s a coincidence of timing that this issue of CityBeat contains a news article about a recent panel discussion on “the vanishing middle class.” People familiar with the topic probably already know one of the article’s salient points: Although worker productivity has increased significantly since the mid-1970s, wages for many workers have remained flat or even dropped in inflation-adjusted dollars. The people benefiting from the increased productivity are the wealthiest one-fifth of Americans, who saw their share of income increase. Most of us are working harder but we’re not reaping the fruits of our labor.
Despite being cleared of lawsuit charges, activist organization 'targeted by right-wing groups' decides to dissolve
2 Comments · Tuesday, March 30, 2010
Amid their crushing defeat last week in the health care bill debate, GOP pundits and conservative groups had at least one victory to celebrate: ACORN, the liberal community activist group, announced it was shutting its doors. While right-wingers celebrated the group's demise, others saw the announcement as the final throes of a political assassination writ large.