Pension plan helps contain city's costs
The Baltimore Sun's editorial on retired city police and firefighter benefits is wrong and incredibly mean-spirited ("A costly pension benefit," editorial, Oct. 23).
Let's start with some basics.
All city employees, except police and firefighters, earn for their years with the city both a city pension benefit and Social Security. Police and firefighters do not get Social Security benefits. The only pension benefits they get for their years with the city come from the Fire and Police Retirement System, which is funded in part by their own contributions.
Under this system, instead of getting cost-of-living increases annually in retirement like other city employees and most other workers in the country do, retired Baltimore police officers and firefighters only get an increase when the investment return from their retirement system is greater than the actuarial requirements for the year.
Even then, only a portion of the excess goes to the retiree pay increase. The city gets the benefit of the rest of that money to reduce its costs for that year or in future years.
This model has worked well for the city from a cost perspective.
In 2009, for example, Social Security retirees will get a 5.8 percent increase in their pension benefits. Retired police and firefighters will get no increase because their retirement system did not have excess investment returns for the year. Simply giving the police and fire retirees the same 5.8 percent increase Social Security retirees will get would have cost the city about $80 million.
To characterize the police and firefighter at risk benefits as a "gravy train" is simply wrong.
To suggest that these retirees bear the brunt of balancing the city's budget is mean-spirited. It is also inconsistent, unless The Baltimore Sun also supports cutting Social Security benefits to retirees to help balance the federal budget.
The editorial is also wrong about William Donald Schaefer's position on the issue. Mr. Schaefer, who was mayor at the time the variable benefit system was created, initially opposed it.
However, he eventually became a solid advocate of the variable benefit system, as is evidenced by the commendations he gave to me and others involved in creating it and by his strong support of it among retirees.
Robert G. Bolton, Baltimore
The writer is president of an actuarial consulting firm who helped design Baltimore's variable pension benefit plan for police officers and firefighters.
Let legislators deal with budget woes
State Comptroller Peter Franchot's call for a bipartisan group to undertake a "critical review of state revenues and spending" is indeed (sorry, Jay Hancock) a dumb thought, an idiotic attempt to, literally, pass the buck ("Bipartisan budget-cuts panel deserves consideration," Oct. 22).
One would think that as comptroller, Mr. Franchot would know there is already a bipartisan body that deals with state revenues and spending.
This motley crew is called the Maryland legislature, and they are the folks we elect and pay to deal with state revenues and spending.
John Lofton, Laurel
Slots take the most from those with least
Slot machines in Maryland are a bad idea ("Slots advocates build cash lead," Oct. 25).
One-armed bandits prey on people who can't afford to gamble. They provide a way for politicians to create more ways to keep themselves in office without the pain of making the budget decisions they were elected to make.
Both parties should be ashamed of themselves for creating the travesty that is the slots referendum.
Any money that slots might make available for education is at least a couple of years away.
And why should horse racing get to suck money from the public feeding trough?
Ralph W. Geuder, Ellicott City
Wall St.-style bailout for racing moguls?
If you liked Washington's $700 billion bailout of Wall Street tycoons, you will love using slots to bail out Maryland's racetrack moguls and should vote yes on Question 2 ("Slots advocates build cash lead," Oct. 25).
However, if you did not like the Wall Street bailout and don't want to see a repeat performance here in Maryland, like me, you should vote no.
Herman M. Heyn, Baltimore