A groundbreaking plan to dramatically reduce the costs and benefits of the New York State pension system has been crafted by Republican Assemblyman Mike Fitzpatrick (R-Suffolk, 7th A.D.) — and the Fitzpatrick Plan has just received strong support from Democratic Assemblyman George Latimer of Westchester’s Sound Shore (91st A.D.).
The new pension plan would, for the first time, shift the pension system for a group of employees, from a defined benefit plan to a defined contribution plan – in this case for elected officials and high-level non-civil service appointees.
“As I’ve said before, sacrifice in these difficult times begins with the political class of state employees,” Assemblyman Latimer said, “and Mike’s plan is the best way for Assembly members, Senators and Governors to lead by example.”
The plan is contained in bill A.6932 (view the text on-line at www.assembly.state.ny.us – Quick Bill Search), with 14 co-sponsors. In addition to Latimer, one other co-sponsor is a Democrat, Ginny Fields of Suffolk County; the remaining 12 are all Assembly Republicans. In the highly partisan environment of Albany, it is unusual for any Democrat to support a Republican bill (and vice versa).
Latimer added that “my background in corporate assignments in my business career taught me to recognize the urgency to change when change was needed. If we expect to reduce costs, we have to re-think our strategies. Starting with elected officials and high-level political appointees is an excellent test of the theories of cost savings right away.”
During the state’s fiscal crisis, Latimer has previously announced his taking a voluntary pay cut of 3%; reducing his staff by 2 positions (40% cut), and his decision to forgo member items (a/k/a “pork” project spending) for 2010-11, reducing his direct expenditures to the state by $175,000.
The Fitzpatrick Plan would freeze the current retirement plan for affected employees, with each participant capping the benefits they have accrued up to the point at which the new program bill passes. The defined contribution plan would be implemented through the office of the State Comptroller; it is expected he would contract with one or more financial organizations to administer the plan and invest the funds held.
Assemblyman Fitzpatrick commented that there would be “a dramatic reduction in the cost of pension contributions to every level of government for the elected or political class. For elected officials, we should not be entitled to a defined benefit pension. We should pay our own way, lead by example, serve the taxpayers first, not ourselves.”
The proposal faces expected opposition from legislators who would be directly affected by its provisions; the bill does not directly affect the public service unions.