March 25, 2014
Update on the pension ordinance from Government Affairs
The Government Affairs team has been working with Chamber members, the Mayor and members of Cincinnati City Council regarding an ordinance that addresses the pension problem. As one of the top priorities of the Chamber, the immediate need has been to address the $870 million pension liability facing the City of Cincinnati retirement system. The Chamber was pleased last week when Mayor Cranley proposed an ordinance to City Council that would allow the City to enter into negotiations with city retirees and current employees regarding pension and medical benefits. On Wednesday March 19th, City Council voted to unanimously support the plan.
These negotiations, mediated by U.S.District Judge Michael Barrett, would help the City address that liability and protect future benefits. The negotiations will likely include a temporary halt to cost-of-living increases, lowering the permanent COLA (cost of living allowance), reducing health benefits, and a mandated annual city contribution to the pension fund.
The ordinance and vote come at a time when the City is under financial scrutiny from bond agencies and state officials. Representatives of Moody’s and Standard and Poor’s are visiting Cincinnati this week to discuss the city’s financial situation and Mayor Cranley expects that the City’s credit rating will be downgraded, but hopes that this ordinance will lessen the rate drop.
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