The City Council approved a long-planned increase to public
safety employee pensions Monday, after putting the issue on hold
last month amid concern among council members that the increase
would break the city’s budget.
Hollister – The City Council approved a long-planned increase to public safety employee pensions Monday, after putting the issue on hold last month amid concern among council members that the increase would break the city’s budget.
Council members voted to honor the agreement made by a previous City Council and raise the city’s contribution to police officer pensions, citing the city’s legal obligation to do so. But at the same time councilmebers expressed concern about the impact the increased contribution will have on the city’s budget.
“I have to vote for it because I have no other choice, according to my legal advice,” said Councilmember Robert Scattini. “Where are we going to get the money to continue this when we get down to bare bottom?”
In 2002, the city negotiated with the Hollister Police Officers’ Association to increase their retirement benefits from 2 percent to 3 percent at age 50, a deal that will take effect on July 1. A similar deal for Hollister firefighters is slated to begin in July 2006.
But last month, worrying that an annual $1.7 million in public safety pension costs – for both firefighters and police – could drain the city’s budget, the City Council delayed voting on the long-planned increase to the police retirement program and took time to look into the legal ramifications of breaking the contract.
At that time, Ray Wood, President of the POA, said officers are not likely to renegotiate a contract to increase their pensions and predicted the union would win in court if the city tried to renege on the deal because of budget concerns.
In addition to legal concerns, councilmembers voted to increase the city’s contribution to police pensions Monday because they thought it was the right thing to do.
Councilmember Doug Emerson said, “I’m going to support this, not because of legal suits … I believe it’s the right thing to do.
“We have to honor the agreement made three years ago,” said Councilmember Monica Johnson.
Currently, Hollister police officers and fire fighters receive 2 percent of their highest salary for every year they served upon retiring at age 50. For example, if an officer has 20 years of service when he retires at age 50, those years would be multiplied by 2 percent, giving him 40 percent of his pay as final compensation. With the increase to 3 percent at 50, an officer serving 20 years will receive 60 percent of his pay as pension, according to the Peace Officers Research Association.
When both fire and police contracts, increasing the multiplier to 3 percent take effect, the city will be paying about $1.7 million per year out of its estimated $13 million general fund budget for public safety pensions.
Luke Roney covers politics and agriculture for the Free Lance. Reach him at 831-637-5566 ext. 335 or at [email protected]
