Westchester County Executive Rob Astorino slammed Gov. Andrew Cuomo's proposal to allow local governments and school districts to spread out their employee pension payments.
“It's a gimmick and it's very bad," he said.
The county executive spoke about the issue at his "Ask Astorino" forum on Tuesday night at New Castle Town Hall in Chappaqua. He argued that it could mean having to borrow for the obligations and resulting in governments having to deal with "huge, huge ballon payments down the road.”
Cuomo, who lives in New Castle, included the item in his proposed 2013-14 budget.
The voluntary program is officially called the Stable Rate Pension Contribution Option, which would allow for participating entities to lock in a constant contribution rate for several years. The legislationin the governor's budget calls for having the fixed contribution rate set at 12 percent. Payments for the system could be amortized, which prompted concern from Astorino.
Cuomo's office contends that the system could yield savings for entities would choose to participate in it, avoiding the volatile nature of the traditional system. The system relies on school districts, municipalities and counties having to pick up the slack when investments do not perform well enough to provide for a guaranteed rate of return for the state's various pension funds.
Astorino is the latest official to come out against the idea. According to published media reports, elected officials who are skeptical about it include State Comptroller Thomas DiNapoli (who would have oversight of the plan) and Syracuse Mayor Stephanie Miner. Cuomo's office, meanwhile, has released a list of local officials who support the plan, which can be found here.
Among those listed in the statement of support for Cuomo's plan is Westchester County Board of Legislators Chairman Kenneth Jenkins, a Yonkers Democrat who has announced that he will run for county executive, and challenging Astorino, who is a Mount Pleasant Republican, for the office.
Cuomo's office claims that the pension proposal would save Westchester County $40.1 million for the 2014 fiscal year and $140.3 million over a 5-year period.
Meanwhile, Astorino sounded a proverbial alarm bell at the New Castle gathering, noting that the county faces a roughly $91 million pension bill for 2013, versus just about $3.3 million in 2001.
The county executive is also lukewarm on the new pension Tier VI, which Cuomo signed into law last March. It includes a higher retirement age, a longer vesting period and an optional 401(k)-style plan alternative for some state employees. However, the measure will only apply to new employees, and Astorino argued that the savings will not be realized for years.
In the meantime, Astorino argued, the pension contributions are an example of unfunded mandates that come from the state and are posing a fiscal threat.
“We're ready to drown, all of us," he said about the financial climate.