Tier VI

POINT I.
We Don't Yet Know the Financial Impact of Tier III.
Since the Veto of the Tier II extender in 2009 not one NYC Firefighter has been hired into Tier III and we are already calling for the creation of Tier VI. The details of Tier III are still being worked out and have changed multiple times. A recent study showed that pension costs for New York City will peak and start declining in 2016. A new Tier VI should not be considered until both management and the unions have had a fair opportunity to evaluate Tier III in actual operation.

POINT II.
Let's Straighten Out Tier III/V.
Tier V was brought into existence by means of a very large, complex, vague, poorly understood and hastily passed piece of legislation, and it has been difficult to implement. In addition future New York City Firefighters were left out of Tier V and were left with only Tier III. A lot of the "bubble people" who wanted to opt into Tier V either weren't made aware of the process or were unable to complete it effectively because many of them ended up in Tier III when they intended to opt into Tier V. Pension administration is a complex business, and implementing any new tier takes time and a lot of work. Let's straighten out the Tier V elections before we move onto a Tier VI, and lets not make the same mistake again by hastily passing a Tier VI bill that imposes drastic changes on our pension system in the context of this year's budget just so the Governor and Legislature can say they did it. Additionally there is confusion over the implementation of Tier III with ongoing litigation and a recent change of interpretation with the NYC Law Department.

POINT III.
We've Done Our Part.
NYC Firefighters have given up enough by being forced from Tier II to Tier III. They are no longer eligible for retirement after 20 years of service. They must now work 25 years to get full service credit and are no longer afforded the same accidental disability and death benefits. Firefighting remains an extremely dangerous job. Firefighters that get injured or killed in the line of duty can no longer rely on knowing that their family will be taken care of. Tier III has no provisions for any of the presumptive disabilities that protect Tier II members. Legislative intent was to cover all current and future firefighters with accidental disability benefits with the presumptive illness laws. They should be entitled to them and that is backed up by irrefutable medical evidence. Firefighting is a physically demanding and dangerous job. An older firefighting workforce jeopardizes public safety.

POINT IV.
Its' Too Much to Ask.
The Governor's Tier VI proposal is simply too harsh. Its five major components are increasing the employee contribution rates from 3% to either 4, 5 or 6% depending on salary, eliminating overtime from all pension contributions and calculations, imposing an 8 % Kingston cap on FAS based on a 5-year look back, an overall salary cap of $179,000 and 12 year vesting. Each of these features, or some variation thereof, standing alone would be a substantial further contribution by public employees to the solution of this State's long term fiscal concerns, but all five of them with the same effective date is simply too much.

POINT V.
The Elimination of Overtime From the Calculation
of Final Average Salary is a Mistake for Several
Reasons.

• It isn't necessary because the 8% Kingston cap combined with the five year look back will severely limit pension calculations solely on the basis of step increases, longevity increases and promotions before even reaching overtime earnings.
  
• If employers know that they don't have to pay pension contribution on overtime earnings, they will be encouraged to use forced overtime as a substitute for adequately staffing their departments. That is bad public policy.
  
• It isn't fair. If the officers worked the hours and were paid the money, it should count towards their pension. §90 of the General Municipal Law stated that principal until it was modified by Tier V.

POINT VI.
Using Fixed Dollar Salary Categories Is A Mistake.
Pension legislation may remain unchanged for decades, but that is not true of salary levels. The salary level-based categories set forth in the Governor's proposal will be outdated in a short amount of time and will result in an ever increasing number of public employees being pushed into the higher percentage brackets. If dollar figures are to be used, they should at least be indexed in a fashion that will allow them to remain current with the economic times.

POINT VII.
Mayor Bloomberg Has Said He Wants
the Ability to Negotiate Pensions
Any proposed pension changes should be negotiated between labor and management. This has been the position of the Mayor in the past and it is disingenuous to claim he wants the legislature to pass a unilateral flawed Tier VI now. If the Mayor is serious about making changes he should sit down and negotiate with Labor.

POINT VIII.
Effective Date.
The New York State Comptroller's top staff has indicated that this plan could not possibly be implemented by the April 1st effective date proposed. The 401k part of the plan would be especially difficult to implement by the April 1st effective date because no such thing even exists at this time.

POINT IX.
The Governor's Tier VI Proposal Does Not
Belong in the Budget Bill.
Even if enacted and made effective April 1,2012, the Governor's Tier VI proposal would do little, if anything, to effect the 2012-2013 State budget or the NYC Budget.
Savings from a Tier VI would only be realized far in the future. Connecting this legislation to the Budget Bill is simply a game of political chicken, daring any one who opposes it to run the risk of being blamed for shutting down State government. This bill should be separated from the Budget Bill and presented on its own so that it can receive the study, analysis and public debate that a matter of this importance deserves.

POINT X.
401K Style Defined Contribution Plans
Are Simply Not Anoption For Firefighters
Firefighters are dedicated public employees. Most of them continue to work beyond their eligible retirement date knowing that if something should happen to them their family will be taken care of. If a Firefighter is killed in the Line of Duty, beneficiaries may be left with a paltry sum and the widows and children will be left with little means to live on. The investment returns and contributions to 401k style plans put all the risk on the firefighters that already risk their lives for public safety.