We’ve been reading with great interest the debate over St. Louis Mayor Francis Slay’s proposal to change the pension plan for city firefighters.
One published report noted that even before Slay’s proposal was introduced to the city’s Board of Aldermen, members of International Association of Fire Fighters Local 73 staged a press conference at City Hall to announce a counterproposal.
Firefighters’ pension costs have escalated from $7.2 million in 2007 to an estimated $32.9 million in 2014, according to city officials. But the skyrocketing cost of employee pensions is not something that will keep Mehlville Fire Protection residents up at night, thanks to the efforts of the district’s Board of Directors.
Chairman Aaron Hilmer and Treasurer Bonnie Stegman were elected in April 2005 after campaigning on a re-form platform, vowing to eliminate fiscal waste while improving services.
The biggest reform by far, according to the two, was changing the district’s pension plan to a defined-contribution plan from a defined-benefit plan.
Less than a year after taking office, Hilmer and Stegman voted to change the district’s pension plan. To listen to the outcry from members of Local 1889 of International Association of Fire Fighters and their legal counsel, one might have thought the world was coming to an end.
Heck, the union’s legal counsel at the time was ranting about the need for a grand jury investigation.
Within days of the vote, Local 1889, which merged with Local 2665 last year, filed a lawsuit seeking to prohibit the board from changing the plan. After a nearly three-year legal battle in which the district and board — including Secretary Ed Ryan, who was elected in 2007 — prevailed every step of the way, union leaders agreed to settle the dispute.
Quite frankly, we’re baffled why the proposal to change the plan met so much resistance. Under Mehlville’s defined-contribution plan, the district contributes from 8 percent to 11 percent of an employee’s total compensation to the retirement plan based on years of service.
Calculations performed about a year ago found the old pension plan’s un-funded liability would have totaled nearly $18 million if the plan hadn’t been changed.
We applaud the MFPD board for its foresight and courage to solve the pension issue instead of doing what most elected entities have done — kick the can down the road and hope a future board will solve the problem.