Mayor Chris Beutler today testified in favor of an ordinance to change the City employee retirement plan to a $1 to $1 match for new employees. But he said the ordinance, which had it public hearing before the City Council today, is only one step in the process of changing the match. The City currently contributes $2 for every $1 contributed by employees to the pension plan. The Mayor proposed the lower match, effective January 1, as part of his 2009-2010 budget proposal.
The Mayor said he continues to believe that the two-to-one match has created a divide between residents and City employees, especially in light of budget cuts. "It is difficult for Lincoln citizens to understand why we must cut the services they depend upon, but still maintain the two-to-one match," he said. "Residents are less likely to follow our leadership if they don't believe we have their best interests at heart."
But Beutler said the City faces limitations on making the change. Every expert consulted by the City has agreed that the retirement match for current employees cannot be legally changed. The City also must follow the rules established by the state Commission of Industrial Relations (CIR), which mandate that compensation be determined by comparison with similar cities. The City has hired expert counsel with CIR experience to provide advice on the process for changing the retirement match.
We can and should provide for our employees' reasonable retirement benefits. It's our obligation. It is our duty," Mayor Beutler said. "But our commitment has to be tempered by the day-to-day realities faced by the citizens of Lincoln who pay the bills. The change is a step in the right direction for the future of our City.
Beutler said City employees have "risen to every challenge we have issued," and the proposed change does not diminish the high value placed on their work.