[quote=no_such_reality]IMHO, the unions have repeatedly said how they DIDN’T ask for the 3% formulas. Seems like the easiest fix is to give up the unrealistic 3% formulas.
That’s really were the problem is, 3% at 50 or 55. People retiring with an 8-90% of max year payout with 37 years of life expectancy left.[/quote]
Absolutely. At the very least, retirees should only receive benefits based on what they’ve put in. IOW, if someone worked under the 2% formula for 29 years, and then 1 year under the 3% formula, the benefit formula should be calculated based on that. As it works now with the “retroactive pension increases,” those workers are getting benefits based on the 3% formula that CURRENT employees and employers have to pay. Additionally, most of those older retirees also have retiree healthcare, whereas most municipal employees who’ve been hired since the mid-90s do NOT get these benefits.
Again, taxpayers do NOT pay benefits directly to retirees. The fund calculates a percentage required to fund the entire fund for current and future retirees, and this percentage is charged to the employees and employers. It’s the “employer portion” of the pension contribution costs for CURRENT employees that represent what “taxpayers” have to pay toward the retirement funds.
