Pension issues

Mlive.com's Printer-Friendly Page: "Pension issues land at Muskegon's feet
Pension costs don't bedevil only big corporations, like personnel-heavy airlines or automakers. They're a big expenditure, too, for municipalities -- and taxpayers -- and must be addressed.
Retired city of Muskegon employees now actually outnumber active employees 300 to 275, and the city must set aside more than $1.8 million on an annual basis to fulfill its pension obligations to them. Those retirees are the lucky ones. Think of all the underfunded pension plans in the private sector that have been slimed by corporate skullduggery in recent years.
Personnel spending is the biggest component of a city's budget. It goes to police who patrol your neighborhood, the firefighters who respond quickly to an emergency, the men who plow your street in the middle of the night.
Obviously, local governments can't simply dissolve the pensions earned by such individuals, the way some troubled private corporations have done recently, nor should they. These are legal obligations that have to be met not just by force of law, but out of a sense of honor and decency that says -- or used to -- that a promise is a promise.
However, cities can and should find new ways of addressing those costs.
Muskegon took what looks like a good step when it changed the way it deals with its new employees. Instead of saying it will pay them a certain number of dollars for every year of service, it is requiring them to pay some of the cost. And it gives them a say in how those dollars are invested. That, and the fact that those benefits can transfer to a new employer, give workers a feeling of ownership and responsibility for their futures. More importantly, the new employees understand up front how the system works.
The city also is shifting non"