Reform plan for pensions likely to die GOP rift continues to block passage with deadline near

Setback for Gary

Measure could return later, with revisions, if time to vote expires

August 20, 1996|By Scott Wilson | Scott Wilson,SUN STAFF

The County Council last night continued tinkering with the Gary administration's pension bill, all but dooming its chance for passage by the Sept. 3 deadline.

The measure that has been at the center of Anne Arundel politics since June has opened a breach in Republican ranks. In political parlance, pension reform has become a "wedge" issue dividing local party leaders, who are at odds over how much county employees should be asked to sacrifice during tough fiscal times.

Grumbling is coming from Republican groups who accuse the council's GOP majority of failing to support a key party leader, County Executive John G. Gary.

The result of the divisions has been months of debate over a bill that Gary has pitched as the only way to preserve the county's $750 million retirement system.

Union leaders criticizing council members has become a Monday night ritual. As one administration official put it: "The longer this drags on, the longer they get beaten up."

But Republican Chairwoman Diane R. Evans and her three GOP colleagues appear no closer to approving the bill by deadline.

Republican Party activists, most of whom have turned their attention to GOP presidential politics, say Evans may be trying to position herself for future elections by acting as chief skeptic on a controversial bill. Of the 20 amendments introduced last night, Evans sponsored or co-sponsored 18.

"The unity hasn't been there that could have taken care of this stuff a while back," said Robert C. Schaeffer, president of Anne Arundel Taxpayers Association. "Several members are looking for reasons to disagree with John Gary."

The bill has passed through so many versions that drafts have been color-coded for council members.

Last night, council members approved more than 10 amendments to the 41-page bill that officials say will save the county an estimated $6 million annually -- more than a penny on the property tax rate. The amended bill must be advertised in today's local paper for the council to act on it Sept. 3. The council has 95 days to vote on a bill.

The technical changes approved last night do not fundamentally alter the bill, which Gary has called the linchpin of his months-long effort to cut county personnel costs. Most of the savings would result from the creation of a retirement plan for new employees that would pay half the current retirement benefit.

Anne Arundel spends roughly 75 percent of its $754 million budget on pay and benefits.

The administration, as well as its Republican allies on the council, has been trying to line up a four-member majority on the seven-member council to approve the measure before it expires. That support has not materialized. Gary could introduce a revised bill if this one expires.

"It's crunch time, and I want to see pension reform completed," said Councilman John J. Klocko III, a Crofton Republican who is considered a key swing vote. "But not if it's the wrong thing to do."

Evans, an Arnold Republican, has said she will delay a vote on the bill until all sides have been heard. Most notably, the county Pension Oversight Commission has yet to issue its report on the legislation. That analysis is expected the first week of September.

"I concede that some pension reform is necessary," said Dennis P. Howell, chairman of the commission. "But the way they are doing it is not the right way."

Under the new system, county workers hired after the bill is approved would:

Receive 30 percent of their annual salary as a retirement benefit. The county's 1,100 retirees now receive a 60 percent benefit, which will also apply to current employees.

Contribute nothing to their retirement plan. Most of the county's 3,500 employees now give 4 percent of their pay to their pension.

The bill would also eliminate the guarantee of cost-of-living raises for retired workers by linking such increases to the pension fund's investment earnings. In return, the limit on cost-of-living raises would increase from 3 percent to 4 percent. Baltimore city pays COLA raises to retired police and firefighters that way now.

Gary has threatened to place county employees in the less-generous state pension fund if the council does not reform Anne Arundel's retirement system. The council would have to approve such a move.

Schaeffer said the public is not paying attention to pension reform, an arcane topic with broad financial implications for the county. But he said the issue could arise in future elections for county or state office.

"The party as I see it right now isn't showing much enthusiasm for either side," Schaeffer said.

Pub Date: 8/19/96

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