What is Council Really Afraid Of?

After witnessing the desperation of City Council this week, we have towonder what can be so frightening about the state takeover of thepensions. If they have to boost annual contributions from the parking tax to $27 millionto satisfy the 50 percent requirement, then in addition the contributionthey must make to continue improving the funding ratio and to keep upwith payments from the funds will boost annual contributions to $100million. That is the number Council is so afraid of if the state takes over the funds.

In effect, the Council is passing a bill requiring the City tospend what it would have to spend if it were taken over by the state.Something the Cityshould have done years ago without the threat of atakeover.

The question remains: the bill being passed is not anenforceable contract. What is to prevent a new Council three yearsdown the road from reneging on the obligation by passing a new law orrepealing the bill about to be passed? And that goes to the firstquestion about what Council members are so afraid of in a statetakeover. Under state management the higher payments would have to bemade. Not under state control, the City would start wriggling to getoff the hook.

Council’s first plan of the week was to generate $900 million over30 years while the latest plan is expected to produce $700 million.The executive director of PERC has indicated he was not confident that Council’s $900 million plan would be adequate. What will the executive director now say to this latest scheme Council expects to vote onat 11PM on December 31st? Why should the state have any confidence inCouncil’s promises?