A Mcouple of factors have contributed to the pending increase, Barrett said: Police and fire budgets and a drop in the anticipated earnings on the city’s pension fund from 8% to 7.5%.
Police and fire pensions
The city’s fire and police sworn personnel make up about 80% of the total pension costs.
Barrett said the city is looking at the structure of the pension system for all other police officers and firefighters throughout Wisconsin as a potential template for the city’s package for those departments.
Milwaukee and Milwaukee County are separate from the state’s retirement system.
The city is interested in having parity with the Wisconsin retirement system, Barrett said.
“We are faced with the notion of having a dramatic increase in the pension payment on the horizon, (and) a law that does not allow us to renegotiate this unless we do it through collective bargaining,” Barrett said.
Shawn Lauda, president of the Milwaukee Police Association, said he believes the parity is already there. He said the union has made concessions.
“I think we’re absolutely paying our fair share if not more so than some,” he said.
Mike Bongiorno, president of Local 215 of the Milwaukee Professional Fire Fighters, said both sides do significant research before bargaining to ensure the city retains good employees and is comparable to the rest of the state and cities of the same size.
He said Local 215 understands the financial challenges facing the city and said it’s necessary to find ways to help fund not just the pension system but the entire city.
“We understand the financial challenges that the city faces, and we’re here to be a part of the solution, not part of the problem,” he said.
Drop in assumed rate of return
In addition, starting in 2023, the city will be contending with a 0.5% drop in its anticipated earnings on its pension fund, from 8% to 7.5%.
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