DC 37 Stops Bill Merging BERS Pension System

By MEREDITH KOLODNER

The Bloomberg administration's push to fold the smallest municipal-employee pension system into two larger ones was blocked in Albany this legislative session by unions opposed to the bill.

PETER J. ABBATE: Unions blocked bill.

The measure would have transferred 21,000 enrollees in the Board of Education Retirement System, and its $2 billion in assets, to the Teachers' Retirement System and the New York City Employees' Retirement System. District Council 37, which represents most of the members affected, had lobbied against its passage.

'Unions Killed It'

"It's dead for this year," said Barbara O'Neill, the legislative director for Brooklyn Assemblyman Peter Abbate, who introduced the bill at the request of the Mayor. "The unions had enough problems with it that it didn't move."

DC 37 Political Action Director Wanda Williams did not return phone calls seeking comment. Sources said the union opposed it because its members would lose their tax-deferred annuity option if they moved into NYCERS. Local 372, DC 37's largest local, was also opposed because it would have lost its seat on the fund's board; DC 37 has its own designee on the NYCERS board.

Calls to Custodians Local 891 of the International Union of Operating Engineers were not returned, but sources said the union also opposed the bill.

Only TRS and BERS currently allow employees to invest pre-tax money in funds that grow based on stock or bond market performance. NYCERS does not offer that option. Instead, Tier 1 and 2 pensioners are guaranteed an 8.25-percent return and Tier 3 and 4 members are guaranteed 5 percent. The average annual return from the New York Stock Exchange over the past 75 years has been about 10 percent. That number varies, however, depending on which years the money was invested.

UFT's Position

The UFT was working to make sure that all of its members were shifted into TRS, since initially some titles were slated to move to NYCERS. If that change had been made, sources say the UFT would have backed the bill. But negotiations stalled and amendments to the original bill were never offered. UFT officials declined to comment.

Local 372 currently has one of the two "employee" seats on the 15-member BERS board. In order to act, a majority of board members must approve a measure, and that majority must include one of the employee members. The board makes most decisions about the fund's usage, including whether a member is eligible for a disability pension and how the money is invested.

The Mayor's Office argued that BERS had become "redundant," and had promised that all 70 BERS employees would be transferred to similar positions at other retirement systems.

"It preserves jobs and benefits for members while saving the city $12 million annually," mayoral spokeswoman Dawn Walker stated of the failed bill.