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City Council still looking at Nutter's lower-cost pension plan

CITY COUNCIL dealt with bikers and billboards before wrapping up its calendar for the year, but "the blob" was left untouched.

CITY COUNCIL dealt with bikers and billboards before wrapping up its calendar for the year, but "the blob" was left untouched.

Mayor Nutter sent a bill to Council in October that would shift future elected officials and thousands of city employees to a lower-cost pension plan, but it was never introduced.

Although Nutter says the shift to the lower-benefit pensions is the right way to fill a hole that threatens how much the city can spend on everything else, Council says it's taking its time to get it right.

"It's a pretty complicated issue," said Council President Darrell Clarke. "It could impact 5,000 individuals, and then, realistically, some people have a perspective that it will impact the collective bargaining that is currently taking place among the municipal workers."

Clarke said he's looking to have an outside consultant vet the proposal, but that he has no time frame on when it would be introduced.

"I think the president and his staff are looking at the bill and trying to understand all of the particulars that go with it," Nutter said. "I'm certainly hopeful that in the coming new year that the bill will go through the normal legislative process."

The measure would place future nonunion employees and a small amount of union workers into a hybrid plan with a lower-benefit pension and 401(k).

The measure would also force future elected officials to go into the hybrid plan. The current retirement plan allows elected officials to collect pensions that can be as much as their salary.

"The pension fund is under 50 percent funded," said city finance director Rob Dubow. "We need to take steps to make it healthier."

The so-called "pension blob" has gotten bad over the years as elected officials promised retirement benefits to city employees, but put off paying for them or asking for sufficient worker contributions.

With such a large hole to fill - the pension plan took a huge hit in the 2008 stock-market crash - major changes are needed. According to Nutter, the hybrid plan is the way to fix that.

That has become a major sticking point in negotiations with the city's blue- and white-collar unions, who don't want changes.

They were offered a similar deal as the one recently imposed on the city's nonunion and exempt workers. That deal included raises, furloughs and significant givebacks.

"I don't think it's fair for the 30,000 represented workers who don't have opportunities to address their pensions, wages and benefits," said Councilman Bobby Henon. "It's my belief they should occur at the same time."