SECOND IN A SERIES

THERE ARE a lot of dark clouds on Philadelphia's fiscal horizon, but none so threatening as the looming pension crisis. This is the kind of storm you build an ark for: The city had just over $4 billion in its pension fund as of July 2009; its obligations are almost $9 billion. That's worse than most cities' and states'.

How did Philly get into this mess? Since the 1950s, the city has failed to make adequate contributions to its pension fund, choosing to put off for tomorrow what it needed to pay today. The stock market collapse of 2008 made a bad situation worse by eating away nearly 25 percent of the fund's value.

Then there's the question of the generosity of public pensions. Guaranteed pensions have become increasingly rare in the private sector. And six-figure pay-outs to elected officials from the Deferred Retirement Option Plan (DROP), as well as the most famous pension in Philadelphia - that belonging to former Managing Director Camille Barnett, who worked for the city for 2 1/2 years and will collect about $50,000 a year for the rest of her life - have created an impression that public employees float off into retirement on golden pension parachutes.

But DROP is a drop in the bucket when it comes to pension costs, and Barnett isn't a typical case. We wanted to know: Who are the real faces of Philadelphia's pension system? We ran some numbers, and called up a few rank-and-file pensioners, to ask what they did for the city and what their pensions afford them.

First, some quick background: The city has a variety of pension plans, but, basically, every year during his employment a worker and the city make a contribution to the pension fund. Then the city invests the money. But how well that investment does has no impact on what gets paid out. Philadelphia has a "defined benefit" plan, which means that a worker's pension is determined by a formula that factors in wages, length of service and retirement age - but not how well the pension fund is performing. The payments are guaranteed.

PENSION RECIPIENTS

Franklin Sappington

  • Age: 80
  • City job: Security guard at the Art Museum and the Civic Center, then driver for Civic Center's executive director
  • Tenure: 31 years
  • Annual pension: $14,436.12

Black men had a hard time finding work in Philadelphia back in the 1950s, Franklin Sappington recalls. Most of the trade jobs went to whites. Once the city instituted the civil-service exam, however, it became an equal-opportunity employer.

"As long as you got the score, you got the job," he says.

In his first job, as a security guard at the Art Museum, Sappington worked under one Lt. Norman Nutter. "I've been hoping to get a chance to see the mayor in person and tell him that his uncle was my boss," he says. "He was a very nice person."

Sappington also worked as a guard at the Civic Center. The biggest challenge there was kids jumping the line when popular artists came to town. On the upside, he got to see luminaries, like the pope.

In 1988, the city offered a retirement incentive, an add-on to workers' pensions, and Sappington took it. He then went to work for the private firm SpectaGuard for 14 years before retiring again. Today he lives in North Philadelphia, in the same home he's lived in for 50 years. The house is paid off, as is his 2005 Chevy Cobalt, and he gets by on his pension and Social Security.

Asked if he's comfortable, Sappington says, "Yes, thank God." He says he appreciates that the city has made public employees like him comfortable, but doesn't believe that he's been overcompensated. "You work for the city, you earn every penny."

Evelyn Verrelli

  • Age: 73
  • City job: Prison nurse and health-center nurse
  • Tenure: 11 years
  • Annual pension: $9,102.48

It sounds like an ugly job, but Evelyn Verrelli liked being a prison nurse. "Anyone who was on the front page, you got to meet them," she says. Verrelli says that she never felt threatened.

This is not to say that she was never close to danger. When the Holmesburg prison riot happened in 1989, she was working at a prison nearby, and was brought in to triage the injured after the guards regained control. She remembers them yelling: "Whose prison is it?"

The inmates responded: "Yours, sir!"

Verrelli came to Philly after working at a prison in New Jersey, strictly because the pay was better. She wasn't thinking about a pension at the time - she expected to work until she was elderly. But she was upset, nine years later, when Philadelphia decided to privatize its prison medical care. She needed one more year to be eligible for her pension.

Though some of her co-workers had to take jobs in the private sector and leave their pensions behind, Verrelli was able to transfer to a position at the health center at 3rd and Girard, and stayed on long enough to vest. Now she and her husband live off their pensions (he worked as a schoolteacher in Jersey) and Social Security. They have one home in Lower Makefield and another down the shore, which they bought years ago as an investment property to rent out.

Verrelli describes their lifestyle as "very quiet, comfortable, not anything extravagant. We're very average. . . . Everything that we have, we worked very hard for." She could have made more money if she'd gone to work at a hospital, she says. "The pension was a perk."

Edward G. Luddy

  • Age: 57
  • City job: Policeman
  • Tenure: 25 years
  • Yearly pension: $23,983.20

Edward Luddy grew up around West Oak Lane. An uncle he respected had been a cop. He liked the idea of helping people. And so he became a Philadelphia police officer.

Luddy was 29 when he began, and in his twenty-four and-a-half year career, he did fingerprinting and processing, served as a court liaison and finally worked security down at the airport. The job was interesting, if a bit dangerous. He recalls a scare when he was chasing a robbery suspect down the street and the man spun around - did he have a gun? The guy turned out not to, and in fact, when spinning around, ran into the back of a parked car. Luddy collared him.

Being a policeman, Luddy says, "was a decent-paying job. It could be paid better for what you do, that's for sure." He says that he knew that some other towns paid better than Philly, but he stayed put so that he could be eligible for his pension as early as possible.

After enrolling in DROP, Luddy retired at age 53 and moved to Florida. He's not truly retired, though - his pension isn't enough to live off, so he works 38 hours a week as a security guard at a high school. He doesn't much like the fact that his city-paid health insurance will run out next year (he got five years of coverage from the city after retirement), and he thinks that the pension should come with cost-of-living increases. The cost of everything else goes up, he observes, but "your pension stays the same."

Victor "Vic" Johnson

  • Age: 59
  • City job: Sanitation worker
  • Tenure: 32 years
  • Yearly Pension: $26,256.60

After spending about 12 months in Vietnam, Vic Johnson returned home to South Philly to look for a job. He couldn't find one. "It was kinda rough out here," he recalls.

He went down to the unemployment office, at Broad and Bainbridge, and discovered that because he was a veteran he'd be first in line for an opportunity with Local 427, the sanitation workers. He didn't think too hard on the decision. "I thought,'I'm gonna jump on this.' I already had a son. I needed work. . . . I found out about the benefits later."

Thus did Johnson begin 32 years of walking behind trash trucks, tossing garbage cans. He never drove a truck - "I didn't want the responsibility of that" - never angled for a promotion. He just lifted.

"You lift tonnage a day," he says. A lot of guys leave the job, in his opinion, because "they ain't got the backbone. . . . The snow is bad. The rain is bad. The bags break. . . . In the hot sun, it feels like Vietnam behind that truck." One time, he says, "I had a whole can of rats jump on me.

"People think you ain't nothing but no trash man. But it's a rough job. You gotta learn how to lift."

Johnson paid for the tonnage - he has a bad back now, and bad knees. But the job did well by him in other respects. He bought his house "working OT," and built his pension up the same way. When he hit 55, he thought, "It's time for me to go." He bought his first new car, a Buick Luzerne, as a present to himself - "man, is this a Cadillac" he laughs - and considers himself blessed to be living comfortably on his pension and Social Security disability payments.

Henry Jacobs

  • Age: 74
  • City job: Firefighter
  • Tenure: 25 years
  • Yearly pension: $20,683.08

The problem with running into a burning building is not so much that you feel in danger as that it goes against all your basic instincts.

"I've been on jobs where we're crawling in the front door, and the mice and the roaches are leaving," says Henry "Jake" Jacobs.

Jacobs joined the Fire Department straight out of the Navy in 1958. He retired on disability in 1983 after he was hit in the head with a charged 3.5-inch hose line. It busted up his left eye socket, and surgeons had to remove some of the bone. He's since had a condition called "upgaze double vision," which basically means that if his chin is on his chest and you're standing in front of him, he sees two of you.

After leaving the department, he went to work for Sears for 12 years before retiring for good.

Today, Jacobs and his wife live in a retirement community in Elkton, Md., near their daughter, getting by primarily on Jacobs' pension - but just barely. "It has become tougher over the years," Jacobs says.

Asked if he thinks that he was fairly compensated for the work he put in, Jacobs says, "That's a tough question. You were part of the system of working for the city." The system is supposed to take care of you - and the system, as he sees it, has two major flaws.

The first is that the pensions have no cost-of-living adjustment. So while the lease at the retirement community goes up over time, his ability to pay for it stays the same.

The second is that police and firefighters don't collect Social Security. Jacobs actually gets about $8,000 a year from the program, but it's from his time with Sears and some part-time work, not his public service. He's not sure how other retired firefighters do it. "If I didn't have Social Security, I'd have a tough time of it," he says.

Jacobs still reads the Inquirer and Daily News every day, and he knows the cost of pensions is a problem for the city. But he doesn't believe that this is the workers' fault. "When I started working, I paid 6 percent of my base pay into the pension fund, and the city was to make a contribution along with mine," he says. It was part of his compensation-if the city didn't make enough contributions, or handled its investments badly, he wonders, is that his fault?

"This is our money," he says.

Doron Taussig reports for "It's Our Money," a joint project of the Daily News and WHYY. He can be reached at 215-854-5855 or taussid@phillynews.com.