Retirement reform nears deadline Council, labor leaders say legislation passage now appears unlikely

Action needed by Sept. 5

Measure could return later with changes if time to vote expires

August 06, 1996|By Scott Wilson | Scott Wilson,SUN STAFF

Time is running out on County Executive John G. Gary's plan to recast Anne Arundel County's $750 million retirement system.

The County Council last night was poised to propose a slew of amendments to what has become the most complex bill the Republican administration has introduced or that the Republican-majority council has considered.

Those would come on the heels of 20 proposed amendments from the administration. The council was to consider them late last night.

Gary said during his 1994 campaign that he would cut personnel costs, which account for 75 percent of Anne Arundel's budget. The centerpiece of those cost-saving measures, which have included tying future pay raises for 3,500 county employees to job performance, was expected to be pension legislation.

The administration estimates that the bill would save the county $6 million annually in future years.

But with two meetings left to vote on the measure before it expires, council members and labor leaders are beginning to say that passage is unlikely. The legislation, which was introduced in June, could be resubmitted with changes if the council does not act by Sept. 5.

A bill must be acted on by the council within 90 days of its introduction.

"If we don't vote on these [20 amendments] tonight, then I think the bill is dead," Councilman Williams C. Mulford II, an Annapolis Republican, said last night. "There are a lot of questions that still need to be worked out."

Said Dennis P. Howell, president of Fraternal Order of Police, Lodge 70: "The administration is doing exactly what it didn't want to do. They said months ago that they didn't want to do pension reform piecemeal. And what we have now is one huge bifurcated bumble."

Council members have criticized the administration for failing to sell the legislation effectively. Gary officials, including County Administrative Officer Robert J. Dvorak, have said that without pension reform, the retirement system will crash in a "train wreck" within 10 years.

But several council members, particularly North County Democrats George F. Bachman and James E. DeGrange, have called the "train wreck" a dramatic way of hiding the administration's true intent: To cut county expenses at a time of shrinking tax revenue by asking county employees to sacrifice.

The bill would, among other things, eliminate the guarantee of an annual cost-of-living raise for the county's 1,100 retirees by tying increases to pension fund investment earnings.

Labor leaders have opposed that provision vehemently, claiming that it would illegally roll back approved benefits. But the suggestion surfaced during a meeting called by LeRoy A. Wilkison, president of Local 1563 of the International Association of Fire Fighters, with Gary last year.

In spring 1995, Wilkison and former Baltimore City firefighter Edward C. Heckrotte met with Gary to suggest that Anne Arundel establish a board of trustees to supervise the pension fund. They also recommended that Gary link cost-of-living raises for the county's 1,100 retired employees to investment earnings. Gary said he would consider the proposal.

This year he introduced a bill that contains both provisions but with one catch: The Baltimore City pension plan for firefighters does not guarantee annual cost-of-living raises, but it pays increases with earnings from the city's entire pension fund. In Anne Arundel, firefighters would receive raises from the earnings of a $50 million fund, not the entire $523 million portfolio.

The council is still asking questions about the scope of the proposed board of trustees. Members also are trying to determine whether eliminating guaranteed cost-of-living raises is legal.

"I don't think six months of study on a bill like this is unreasonable," Mulford said.

Meanwhile, the administration is pushing through a thick personnel bill that would give Dvorak a 7 percent pay raise. The county's No. 2 official has testified that pay and benefits are contributing to Anne Arundel's mounting fiscal crisis. The bill has served as a distraction and a handy talking point for opponents of the pension legislation.

But Lisa Ritter, Gary's spokeswoman, said last night that the administration would not pull its pension bill to clean it up. "From the administration's perspective, it makes no difference," she said. "The effect would be the same."

Pub Date: 8/06/96

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