There are two proposals before the Milwaukee County Board Thursday, on the future of county supervisors' pensions. One plan would tweak the payments, reducing the county's contribution. The other calls for a potential revamp of the pension system. Supporters of both measures say they'll save the county money. WUWM's Ann-Elise Henzl reports.
Last fall, Milwaukee County supervisors voted to reduce the amount of money the county contributes to pension funds for non-union county workers. Supervisor Joe Sanfelippo says the county still needs to cut more, because it's running at a structural deficit. So he says now, supervisors should reduce their pensions, too.
"We are the leaders of the county, and for us to say that we have a very severe problem and we ask all of our employees to take the wage and benefit concessions -- and if we don't take them ourselves -- it really doesn't send a signal that we're serious about the problem that we have," Sanfelippo says.
A proposal Sanfelippo supports calls for a 20 percent reduction in pension benefits for supervisors -- the same amount as non-union workers. He says the move would save taxpayers about $30,000 a year. Sanfelippo admits the number is not huge, in a county budget of more than $1 billion. However, he says the supervisors' actions could motivate union workers to agree to a similar reduction. He says if that happens, the county could save millions.
"So we're kind of like hedging our bets here. We're putting $30,000 of our own money on the line, hoping that we're going to be able to gain that $5-6 million savings by setting a good example," Sanfelippo says.
The proposal will go before the county board for a vote Thursday. At the same time, the board will be asked to consider an alternative, co-authored by Supervisor Marina Dimitrijevic.
"Theirs actually would deal with 20 employees, which are 20 elected officials: the county board and the county executive. And ours is a study to get us to go into the State of Wisconsin's retirement system," Dimitrijevic says.
Dimitrijevic says under her plan, all future county employees would enroll in the state plan. Milwaukee is the only county that has its own retirement system. Dimitrijevic says the move would result in cost savings.
"Reduced administrative costs. So that means specifically we wouldn't have to operate a pension board, we wouldn't have to hire an actuary, and the legal costs -- I mean we could share that with the Wisconsin system, and that would produce I think some pretty good savings," Dimitrijevic says.
Dimitrijevic's proposal is a substitute for Sanfelippo's resolution. That means if supervisors approve her idea to fold the county into the state retirement plan, they won't be able to vote on whether to cut their own pension benefits.
The research organization Public Policy Forum won't weigh in on what should happen to county supervisors' pensions. But forum President Rob Henken thinks the county should explore joining the state retirement system.
"It's a way of establishing some closure here. Obviously, the county pension scandal has left a mark on its long-term finances. It's also left a big political black eye for the county. So (there might) be some political benefit in simply saying, 'going forward there's just going to no longer be a county pension fund, and county workers will be part of the state pension system,'" Henken says.
The "scandal" Henken refers to started to unfold in 2000. That's when it was discovered the county board approved overly generous pension payments for county workers. The scandal is partly to blame for today's budget problems.
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