Tuesday, June 06, 2006

Milwaukee County Board:
Retiree Costs Not That Big of a Deal


As the push for a $1.2 million annual tax hike begins, the Milwaukee County Board is touting data that attempts to downplay the drag retiree benefits have on the County budget.

"We must continue to do all we can legally to keep County pension costs to a minimum," said Holloway. "But it is wrong to portray all County retirees as receiving large pensions, as this data shows."

The data indicates the annual pension payments to county retirees averages out to only $17,600 per retiree per year. But there are more than 6,000 retirees.

Moreover, Holloway and his enablers on the board conveniently decide NOT to highlight the costs associated with the lifetime free health care for retirees and their families that many retirees still get. Or the fact that many of these retirees, who leave their jobs while in their 50s, will be in the system for decades, with health care costs only escalating over time.

To be sure, this is not all covered by the tax levy. For example, the County put in less than $20 million to cover the pension obligation last year. The retirement system pays out their obligation with monies earned through investments, too. But there is a huge crisis looming.

As Scott Walker says when making the case against the sales tax hike:

First, it will give Milwaukee County the highest (by far) sales tax in the state. If you go out to eat in the county, add 6.85% to your bill. Can you say 'tax island?'

Second, even if the voters passed a resolution (unlikely), the state government still has to approve an increase in the sales tax. Last I checked both candidates for Governor and the leaders of the State Legislature were opposed to new taxes. In other words, residents could be dragged through this entire debate only to find out that the state says no.

Third, it hasn't worked before. In 1991, the county enacted a .5% sales tax increase for 'property tax relief.' From 1992 to 2002, the property tax levy went up 52%.

Fourth, it is not that we don't have enough money; it is that the county does not spend it well. Our parks system costs $37 million. Pensions will cost the county $50 million next year. Free health care for life will cost $29 million in 2007.

So while retiree costs are not the only component squeezing the Milwaukee County budget, they are a significant concern--regardless of whether the board will admit it or not. Their 'head in the sand' mentality is what put Milwaukee County in this budget crunch in the first place.

True, not all retirees are pulling down big bucks. And clearly, not all Milwaukee County employees are pulling down exorbitant salaries. Yet, I continue to be amazed that this Board actually chastises Milwaukee County Executive Scott Walker for being too pessimistic about the county's fiscal predicament and the ongoing costs associated with exorbitant benefit packages for many employees and retirees.

But, with this bunch, I guess nothing should surprise us anymore.

6 Comments:

At 6:07 PM, Anonymous said...

Is the average too high? What exactly is your criticism here?

Should retirement benefits not include health care?

 
At 7:25 PM, Anonymous said...

No,they should NOT include health care. At least not at the levels that are currently paid.

Retirement health care should have increased co-pays, deductibles and they should have to pay a portion of the premium.

I would LOVE to have the benefits that are given out. But I work for a company that actually has to account for expenses .

 
At 8:39 PM, K. Carpenter said...

$17,600 x 6000 retirees = $105,600,000

and this does not include health care costs or the lump sum payments that many are getting????

Holy cow, my head hurts!

Question- Has anything been done to keep the current employees from making this pension mess worse? Will they be getting the same benefits that current retirees get?

 
At 10:42 PM, Anonymous said...

So, K. "Christian values" include screwing people out of health care? Good health benefits are a good thing.

I will tell you, nothing amuses me more than whiney republicans who want everything, including modern government and satbility, for free.

How about stepping up and taking a little responsibility. Or pray for widespread fatal cancer amongst retirees. jeez.

 
At 11:10 PM, Anonymous said...

In your haste to blog, Brian, you forgot Holloway's first name. Again: another rip at black elected officials. It's a pattern.

 
At 8:51 AM, grumps said...

You should check out Deb Jordahl's blog. She says that "Pensions Belong To the Worker" and that pensions are a good thing.

 

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