Cities Look To Pensions To Fill Budget Holes
HOLLYWOOD, Fla. (CBSMiami.com) – As the economy continues to sputter, city and state governments are turning against their own workers to make up the financial shortfall. The latest cuts are targeting pension plans which have pushed some cities to the brink of financial ruin.
Hollywood voters decided Tuesday night to cut pensions for city workers due to the city’s financial shortfall. The police union was none too happy and vowed officers would be leaving the city.
“You’re crazy not to go to another city…it just makes sense to go to another city that’s more stable,” Broward County Police Benevolent Association Vice President Jeffrey Marano said.
Hollywood isn’t the first local government in South Florida to target pension plans to meet budget guidelines. Last year, North Miami Beach Police protested the budget cuts.
This year, the North Miami Beach Police union is going door-to-door to save their jobs. The city is planning on laying off 17 officers, despite the union offering up ten percent in pay and benefits.
Miami Beach is also having to dip into resort taxes to cover up its budget shortfall, but next year city leaders are planning to slash pensions hard when police contracts come up for negotiations next year.
In Miami, firefighters and police are headed into their third year of budget cuts. In 2010, public safety employees were slapped with five to 12 percent cuts. This year, the budget has a $60 million hole in it and the city said police and firefighters will have to come up with the cash.
“They are going to make it a department of last resort,” said Armando Aguilar of the Miami Police Union. “We are going to get the officers that no one else wants.”
City of Miami leaders met with union chiefs Wednesday to try and put together a new deal. But it may be too little, too late. Morale is reportedly down and officers are feeling the pain of the stagnant economy just like the rest of South Florida.
“It’s gotten to the point where a lot of people are losing their homes, they are losing their credit, and they are just bringing them to the point where either they leave and go work somewhere else or they have to file for bankruptcy,” Aguilar said.
Commissioner Francis Suarez told CBS4’s David Sutta that city leader have no choice. Pensions, unlike 401k’s, are simply devouring city budgets.
“Your 401k is at your risk. You invest it, you make investment decisions and then you win or you lose on the basis of those decisions,” Suarez said. “In city government we promise a result. You are going to get x number of dollars at the end of the day.”
While cities continue to argue for deeper and deeper cuts, the victims of the cuts are left asking why the cities didn’t save the money when the economy was soaring for just this type of scenario.