Local leaders take issue with state report on retirement fund
A state Comptroller’s Office report about lower average contributions to New York’s employee retirement system by school districts and municipalities is being met with some skepticism by local officials who have to budget the contributions.
Comptroller Thomas DiNapoli said Wednesday that contributions to the retirement system currently average 14.6 percent of employee pay, down 0.3 percentage points from this time last year. He noted, though, that the average contributions to the state’s fire and police retirement system is unchanged at 23.5 percent of employee pay.
Despite the slight drop in contributions, “solid investment returns ... provide predictability for employers as they plan their future budgets,” DiNapoli said. “New York state’s pension fund is one of the strongest and best-funded in the country and protects the retirement security of our over one million members.”
Town of Ulster Supervisor James Quigley says the figures in DiNapoli’s report are misleading because contributions are based on employee classification, with higher contributions made for personnel who have been employed the longest.
“When you go into the details and look at the rates for the class of employees that the town of Ulster employs, there is no change,” he said. “When you look at the proposed rates next year for [town of Ulster employees], they are 15.7 percent.”
Ulster’s contributions for town employees in 2019 will be $432,373, a decrease of 1.3 percent from 2018, though contribution to the police and fire retirement system will be $445,554, a jump of 6.3 percent.
DiNapoli’s report also is being downplayed by Kingston school district Deputy Superintendent Allen Olsen, who noted that contributions to the employee retirement system are relatively small compared to those made to the teacher retirement system, which is not overseen by the Comptroller’s Office.
“The change that he suggested, about three tenths of a percent change, for every entity, that percentage would differ,” Olsen said.
Kingston school district officials said the district’s contributions to the teacher retirement system were 9.8 percent of pay last school year and expected to be 10.62 percent this coming year.
Other local leaders also took issue with DiNapoli’s report.
“I suspect because the financial markets are relatively successful, the reserve that [state retirement fund officials] are required to keep is an easy threshold to meet because the value of the equities in the reserve are going up,” Saugerties town Supervisor Fred Costello said.
Costello said it is easy to take credit when financial markets are good but that towns get hurt when there is an economic downturn, such as in 2008.
“We were experiencing diminished payments to us on sales tax, diminished payments to us on mortgage, and our residents who are paying property taxes [were] experiencing loss of jobs and foreclosure,” he said.
Tania Lopez, deputy press secretary for the Comptroller’s Office, noted that the costs for individual employers “varies based on the plans that they have selected for employees and their ... tiers and salary base.”