DEANA STROISCH
The State Journal-Register
Dec 28, 2012
Mayor Mike Houston’s proposed budget for next year will only worsen the city’s pension debt, says Ward 7 Ald. Joe McMenamin, who says he’s already planning to vote against it.
McMenamin said he will vote “no” on the budget for the second year in a row “because it fails to address the police and fire pension debt while continuing unaffordable pay raises that are financed in effect by borrowing from our police and fire pension funds.”
“Slowly moving in the right direction to pay off the pension debt is not an adequate solution because, each year, the pension debt will grow faster than the meek catch-ups proposed by the mayor,” McMenamin said. “Continuously giving wage hikes deepens the pension burden for the future and uses money for wages that needs to be aggressively redirected to the pension debt.”
City leaders expect to have a $2 million budget surplus by the end of the current fiscal year, which ends Feb. 28. Houston plans to ask the city council to allocate nearly half of that surplus to additional payments for police and fire pensions. Springfield’s unfunded police and fire pension liability increased nearly $11 million during fiscal year 2012, according to a recent actuarial study ordered by the city.
The study, done by Chicago-based actuaries Goldstein & Associates, found that the unfunded liability for the firefighter pension fund totaled $116.7 million as of Feb. 29, 2012. The unfunded liability for the police pension fund was $99.8 million.
3 percent increase
Ward 5 Ald. Sam Cahnman called the extra payment, which will be in addition to $18 million in property taxes the city will pay toward pensions next fiscal year, a “step in the right direction.”
Houston’s recommended corporate fund budget for the fiscal year that begins March 1 totals $114.7 million, an increase of $3.4 million or 3.06 percent compared to the current budget. The budget plan doesn’t call for any reductions in services or employee layoffs.
Salary costs are expected to increase by 2.6 percent, or $1.3 million, over the current year.However, that increase is proportionately smaller than during the current fiscal year, when the city’s wage expenses increased by 5.34 percent.
Infrastructure, equipme
The proposed spending plan includes $125,000 for a new rescue vehicle and $100,000 for new air tanks for the fire department. The police department could receive $205,000 for new mobile computers. Current computers are more than eight years old.
Ward 1 Ald. Frank Edwards said $7 million isn’t enough for infrastructure. “The calls I’m getting from my constituents — they want some roads fixed, they want the potholes filled,” Edwards said. Houston, Edwards said, is “not spending any more money on roads and he’ll be entering his third year, and he’s the guy that said he’ll have an infrastructure plan for us.”
During his campaign, Houston said he would produce a plan within 30 days of taking office. Later, he said it wasn’t an infrastructure plan, but a financing plan. The mayor has said he plans to set aside city revenue from video gambling and pursue a bond issue to pay for street, sidewalk and other infrastructure improvements.
***
Joe McMenamin for Ward 7 