- 13th check, other pension rights at stake;
- Public hearing Tues. Nov. 29 9:30 a.m. CAYMC, Council chambers
By Diane Bukowski
DETROIT – Detroit Mayor Dave Bing and the City Council are bidding HAPPY HOLIDAYS and thanks to city retirees for their years of service, by trying to snatch their annual “13th check,” which many have counted on for 20 years to pay past due bills or buy Xmas gifts for their families.
A proposed ordinance amending the City Code would also redefine and limit excess earnings on Detroit General Retirement System (DGRS) investments, from which the check is provided, among other strictures placed on the powers of DGRS trustees to distribute funds to retirees.
Council will hold a public hearing on the ordinance, introduced and supported by Council member Saunteel Jenkins, on Tues. Nov. 29 at 9:30 a.m. It plans to vote on the ordinance later that morning. (Click on Proposed pension ordinance for summary of ordinance.)
“These kinds of changes in pension plans are mandatory subjects of bargaining, and would have to be negotiated and agreed to by the parties,” John Riehl told council Nov. 22.
Riehl, a DGRS trustee and president of Local 207 of the American Federation of State, County and Municipal Employees, spoke at a hearing which had to be rescheduled to Nov. 29 because notice of the hearing did not include mention of the 13th check.
He noted that the Michigan Supreme Court declared pension changes a mandatory subject of bargaining as part of their decision in DPOA v. Detroit, 391 Mich 44 (1974).
Bing first raised the idea of taking the 13th check and reducing city contributions to the pension systems during his April 12 budget address, after which he met with system trustees.
“This is a double whammy on the people” Riehl said, referring to an agreement made during that meeting. “We already agreed to allow the city to spread out their payments into the system over a longer period of time.”
William Williams is a city bus driver and officer of Amalgamated Transit Union Div. 26.
“I’ve been in this city all my life,” he told the council. “I’m one of those who stayed when all my friends were moving to Houston and Dallas. It almost brings me to tears to see the city try to fix its condition on the workers’ backs. We’ve given and we’ve given and we have no more to give.”
Cornell Squires is a former City of Detroit EMS technician, retiree and community activist.
He told VOD, “American Axle got city tax abatements but went overseas,” he said. “The Downtown Development Authority and DTE don’t pay taxes. Tell Illitch and all those people running the Fox Theater, Comerica Park, and the casinos, making money every day to come and contribute, not just the workers. It was the people and city workers who kept Detroit going. They’re building up ‘Midtown,’ but there’s no development in the neighborhoods. There are 72.000 vacant parcels. People could come together like on Angels’ Night if they had the money, they could take all the vacant buildings, turn them into gym shoe plants and other factories and provide jobs for city residents who pay taxes.”
The Detroit Police and Fire Retirement System does not provide a 13th check at this time, according to a published statement by Paul Stewart, Vice-President of the Detroit Police Officers Association (DPOA). He notes, “The DPOA continually tries to obtain such a benefit by negotiations with the City of Detroit. However, so far we have not yet accomplished such a benefit, but we will continue to do so.”
Jenkins told Detroit’s Channel Four News on Nov. 9, “There’s one study done that said if we had not distributed 13th checks there would be about $1.9 billion dollars more in the pension system today.”
However, Bing and the Council are not worried about putting more money in the pension system, which is quite solvent. A previous effort to eliminate the 13th check, during the administration of Mayor Kwame Kilpatrick, was intended to funnel the pension systems’ excess earnings back into the City of Detroit’s general fund. Voters defeated the ballot proposal resoundingly.
Before her election, Jenkins told The Michigan Citizen, which endorsed her, James Tate and Andre Spivey, that although she supported privatization “as a last resort,” she respected the role of labor negotiations. (For MC story, click on http://michigancitizen.com/detroit-city-council-endorsements-p7920-1.htm.)
During his first term, Bing attempted to sabotage both of the city’s pension systems, worth $6 billion. He supported four bills in the state legislature that would have merged the systems into the Michigan Employee Retirees System (MERS), a state-wide system, whose board has no Detroit representatives and is all-white.
Highland Park retirees reported that when MERS took their system over, they frequently failed to get their monthly checks on time.
Council members in office at that time passed a resolution against the takeover. Bing’s effort later failed because the bills were introduced prior to the Rick Snyder and Republican takeover of state government.
Public Act 4, however, contains a provision that calls for a mandatory takeover of municipal pension systems if their funding level falls below 80 percent, among other attacks on public pensions.
Both Detroit systems are funded well above that mark, but the systems filed a lawsuit to overturn PA 4 in April (click on http://voiceofdetroit.net/2011/05/03/detroit-pension-systems-file-federal-suit-against-pa-4-broad-coalition-also-expects-to-take-legal-action/ )
Unfortunately, the suit was assigned to U.S. District Court Judge Sean Cox, a rabid Federalist right-winger and supporter of the Snyder agenda. He dismissed the suit Sept. 29, 2011, but the systems appealed their case to the U.S. Sixth Circuit Court of Appeals on Oct. 26 of this year.