City Pensions Will Cost Taxpayers $722M Over Next 3 Years
Taxpayers must pick up a $722 million tab over the next three years to replenish the city’s cash-strapped municipal employee pension system.
The additional costs are documented in an updated city financial plan released last night by Mayor de Blasio and calls for taxpayer contributions to the system increasing by $120 million next fiscal year, $241 million in Fiscal 2019 and $361 million in Fiscal 2010.
Meanwhile, the updated plan increases spending in the current city budget, which was introduced in June, by a whopping $1.3 billion, to $83.5 billion.
The additional spending is primary due to boosts in federal funding for Hurricane Sandy relief projects but other new costs also includes $52 million to combat homelessness.
The city’s five pension funds — which oversees retirement money for more than 700,000 current and former cops, teachers and other employees — grew by 3.2 percent and 1.5 percent, respectively, over the last two fiscal years.
However, the city is required to make up the difference for returns under 7 percent, leading to $722 million now needed.
De Blasio operatives tried to shift blame at Comptroller Scott Stinger, pointing out it is the comptroller’s office by law that manages the pensions.
However, Maria Doulis, vice president of the Citizens Budget Commission, said it is unfair to blame Stringer, who is considering running against de Blasio for mayor in 2017, because it’s the trustees of the five pension funds “that are driving the horses and investment decisions.”
Stringer spokesman Tyrone Stevens the city’s economy “is getting cloudy,” adding his office has “repeatedly said the mayor must initiate an agency savings plan that would protect essential services and safeguard our financial future.”
Council Speaker Melissa Mark-Viverito and Julissa Ferreras-Copeland, who chairs the council’s finance committee, said in a joint statement the new spending plan “incorporates sound costsaving measures advocated by the Council; however, we remain concerned about rising shelter costs and pension obligations.”