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Nutter seeking reduced pension benefits for new hires

In hopes of saving $500 million over 30 years, Mayor Nutter plans to send legislation to City Council tomorrow - which is Council's final session before the summer recess - that would create a two-tier pension system for union employees.

Under the proposal, which Nutter alluded to in his budget speech in March, new city workers hired as of July 1 would be enrolled in a pension program that is a hybrid between a defined contribution and defined benefit plan. All current municipal union workers participate in a defined benefit plan. The change means new hires would have a lower level of benefits, although they could increase what they get by putting in more of their own money.

Council will not vote on the plan tomorrow; in fact, no vote could occur until the fall.  If approved, it could become retroactive to July 1.

The introduction of the measure comes as the city is bargaining with its four municipal unions. Contracts for all unions - the police, the fire fighters, white-collar District Council 47 and blue-collar District Council 33 - expire midnight June 30.

"We're just trying to get it done as soon as it's ready," city Managing Director Camille Barnett said of the legislation.

While such a bill would be needed to amend the city's pension code, the four unions would have to agree to it indvidiually.

"This is just declining benefits, and I'm not for it," said Pete Matthews, president of DC 33, the city's largest union. Both he and DC 47 Cathy Scott said they were unaware of the legislation.

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