Urge Law Makers To Back Pension Smoothing Plan

by , under Legislative Issues

NYSUT members are urged to fax lawmakers encouraging them to allow school districts to “smooth” temporary pension cost spikes.  Visit NYSUT Member Action Centerhttps://mac.nysut.org/faxlegislators/widget/issue/146

NYSUT Executive Vice President Andy Pallotta said this week pension smoothing is a practical solution to the occasional short-term spikes in the employer contribution rate. However, he noted, any smoothing plan must maintain the integrity of the retirement system. NYSUT is still attempting to address concerns with the governor’s proposal.

“In 2013-14, the spike could increase school district pension payments so dramatically that it could eat up the lion’s share of the $889 million increase in school aid included in the executive budget proposal,” he said. “It would devastate districts and force further program cuts.”

States and localities have used amortization to smooth out the temporary pension cost spike. School districts should be afforded the same financial tools to help mitigate their costs. One piece of good news that came from the governor’s 30-day amendments to the executive budget proposal is expansion of the pension smoothing program to include three public hospitals and BOCES.

“This could save education jobs, alleviate program cuts and increase investment in education across the state,” Pallotta said.