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Comptroller Green joins Payne to warn against fire pension plan change

Comptroller Green joins Payne to warn against fire pension plan change

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Building fire at the 4125 block of Obear Avenue in Fairground

Firefighters gather outside of a building after battling a fire at the 4215 block of Obear Avenue in Fairground on Monday, Jan. 4, 2021. A firefighter on the scene said the building was vacant at the time of the fire. Photo by Cheyenne Boone, cboone@post-dispatch.com

ST. LOUIS — Another of the city’s top fiscal officers pushed back against a plan from aldermen to hand oversight of firefighter pensions back to a board dominated by firefighter interests, arguing it would jeopardize reforms meant to check soaring pension liabilities.

St. Louis Comptroller Darlene Green issued a statement Thursday saying 2012 reforms that established a new firefighter pension plan and moved oversight to a city board was an effort to gain local control, reduce administrative costs and “introduce good governance.”

“Board Bill 221 would undo many of these hard-earned gains amid an economy weakened by the COVID-19 pandemic,” Green said in a statement. “Its passage would negatively affect the city’s already stressed operating budget and ability to provide services. The most fiscally responsible action would be to consider any new reforms once the economy is rebuilding and the city is seeing healthier revenues.”

Green’s statement follows a memo issued by Budget Director Paul Payne calling the proposal at the Board of Aldermen “a significant step back” from efforts to put lucrative firefighter retirement benefits under city control. Payne had been prepared to speak on the bill at the aldermanic Public Safety Committee hearing last week, but chairman Joe Vaccaro, D-23rd Ward, said the agenda was too packed to allow testimony on the pension change.

The opposition from the longtime comptroller and budget director may not be enough to dissuade aldermen from pursuing the pension board move in the heat of election season. Backed by the politically powerful firefighters union, which fought hard against the 2012 reforms, the bill sponsored by Alderman Tom Oldenburg, D-16th Ward, has 21 co-sponsors ranging from progressives to more conservative aldermen.

Half of the board is up for reelection in March, and two candidates for mayor are co-sponsors: Board of Aldermen President Lewis Reed and Alderman Cara Spencer, D-20th Ward. Green is also up for reelection but has no opponent.

The number of sponsors all but ensures the bill’s passage with a veto-proof majority. Mayor Lyda Krewson, who helped push through the 2012 reforms when she was an alderman, does not have a position on the bill, according to her spokesman. It could come up for debate at the board as soon as Friday.

Oldenburg and Demetris Alfred, president of Local 73 of the International Association of Fire Fighters, argue the change is merely a tweak in governance and wouldn’t alter the benefits provided to firefighters.

Then-Mayor Francis Slay’s administration pushed the 2012 reforms through despite major opposition from firefighters. The changes established the Firefighters’ Retirement Plan, a new pension plan with lower benefits for new firefighters, governed by a board on which city officials hold a majority. The old Firemen’s Retirement System board, governed by state statute, maintained control over the pensions of already-retired firefighters.

A court challenge from the fire union and the Firemen’s System ultimately upheld the two-plan system. The judge noted that the old board would remain in place “so as to accomplish an orderly termination and winding up” of the old pension system.

Big bonuses remain

The bill from aldermen, though, would move the new plan under the old board, which has its own employees and ability to hire actuaries and accountants that estimate future liabilities and investment returns. The system is governed by state statute, so a bill allowing the change has been introduced by Missouri Sen. Steve Roberts, D-St. Louis. The Firemen’s System has seven lobbyists in Jefferson City.

In addition to checking city pension liabilities, the 2012 reforms were also meant to put control of the new fire pension plan under city procurement and civil service rules to limit overhead and address concerns over huge benefit packages awarded to the old system’s employees.

Vicky Grass, former executive director of the old system, retired in 2015 with a $579,210 cash payout and a $4,800 monthly pension. She was elected to the Board of Aldermen last year and is a co-sponsor of Oldenburg’s bill.

Her daughter-in-law, Lauren Grass, has worked as an administrative assistant for the old system for about five years, Lauren Grass said Thursday.

She and the three other employees of the fire system received bonuses totaling over $17,000 last year, according to documents obtained by the Post-Dispatch. Executive Director John Brewer, a former firefighter and former trustee on the Firemen’s System board, received a bonus of $6,913, according to the document.

In 2013, the Post-Dispatch reported annual bonuses for Firemen’s System employees of up to $2,500 per person. Brewer did not immediately respond to a request for comment.

Payne said the city budgets $400,000 in annual administrative costs for the new plan. The old plan, he said, costs $1 million in overhead, including $457,000 in salaries and benefits for its four employees.

The fire union and Oldenburg argue the bill is a cost-saving measure.

Payne disagreed.

“If this were truly a cost savings initiative,” Payne wrote in his memo, “then consideration would be given to consolidating the plans under the less expensive (Firefighters’ Retirement Plan).”

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