What makes this a particularly weighty point is a recent report by the Independent Democratic Conference that found fees paid to investment firms for management of the pension fund ballooned by 163 percent over the past five years. The state pays hundreds of millions in fees to Wall Street that it could avoid by instead giving employees their money in another form.
It would be a lot simpler to cut down on this burden, and simplification is something badly needed in this retirement system.
Rather than piling one tier atop another, New York’s leaders need to revise the Triborough Amendment, which among other things requires governments (including towns and schools) to continue honoring an existing contract after it expires and a new one is not yet reached. This means it’s not uncommon for contract negotiations to be drawn out for months and years, which makes it tough for either side to make realistic plans.
And if nothing else out of the Tier 6 plan is adopted, the state must close overtime loopholes that allow some state workers to greatly increase their salaries in their final years on the job by taking massive amounts of overtime hours, and then collecting a pension payout much larger than that allowed by base salary.
This last scheme has bilked the taxpayer out of untold millions. And it’s one that can easily be fixed if the political will to do so existed in Albany.