Unions and Pensions: Another Year Older and Deeper and Debt. By Geniusofdespair

New City of Miami Manager Carlos Migoya said on "Issues" last week that life expectancy has made City of Miami pensions unsustainable (people with pensions have to start dying younger to fix that). He said, right now 56% of the budget is spent on benefits and it should be at about 40%. He also spoke about the cost of living adjustments in union contracts that are costing the City an extra $100 million dollars a year. He said that is because the City pensions have to have a return of 7 3/4% to have the money to make future payments to retirees but he said that with the bad markets these past few years, the City is not getting that return. However, the city still has to guarantee it, thus the extra $100 million needed. (That is how I understood what he said)

Former City of Miami Manager, and Current County Commissioner, Carlos Gimenez was also talking about union contracts - the County's - today in the Miami Herald. What he said was more complex so I don't rightly know if I can sum it up, but here is a quote:

"However, COLAs, merit increases and longevity bonuses do not have a reopener clause. Additionally, the PBA contracts call for their flex benefits to be automatically restored in one year. While the unions agreed to contribute back to the county 5 percent of their base salary toward health insurance in lieu of a salary reduction, these savings are greatly diminished once the guaranteed COLA, merit increases and longevity bonuses are reinstated. For the PBA contracts, the financial impact to the county is even greater. While I am a strong supporter of our police officers, I cannot support contracts that will, on the one hand, have the employees contribute 5 percent of their base salary back to the county toward health insurance, but then give the members of the PBA a 5-percent (one step) raise this year and another 5-percent (one step) raise next year, along with a 3-percent COLA in July 2011. In essence, the members of the PBA are receiving an overall net salary increase of 8 percent through September 2012."

Now if you think the likes of Commissioners Dorrin Rolle, Pepe Diaz, Audrey Edmonson, Javier Souto or Bruno Barreiro can understand any of that...you are sadly mistaken. They will just do what County Manager Burgess tells them to do, or worse, some Lobbyist. Gimenez has made his own mind up: "I could not vote to approve these contracts when that would leave only two options when the time comes to set the millage -- raise taxes or lay off more employees (both of which I oppose)."