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Council DROPping ball on re-election issue?

With its final session of the year scheduled for today, City Council will conclude 2010 without holding hearings on the controversial DROP retirement program, which Mayor Nutter has sought to abolish.

With its final session of the year scheduled for today, City Council will conclude 2010 without holding hearings on the controversial DROP retirement program, which Mayor Nutter has sought to abolish.

Council members argue that they are waiting for further research on the Deferred Retirement Option Plan before moving ahead. But the delay will undoubtedly create political headaches for the six members who are considering re-election bids despite their participation in the program.

"I have always believed, and obviously have recently, that it would be a political issue for myself and any current member who's in the DROP program," said Councilman Frank DiCicco, who is enrolled in DROP.

Armed with an study from Boston College which said DROP had cost the city $258 million since 1999, Mayor Nutter sent legislation to Council in September to eliminate it.

But Council is still waiting on its own review of the study from Bolton Partners, an actuarial consulting firm based in Baltimore.

"I was hoping, believe me, beyond all hope, that this issue would have been resolved," said Council President Anna Verna, who is enrolled in DROP. She said Bolton was still waiting on some information from the Boston College researchers.

Anthony Webb, of the Center for Retirement Research at Boston College, said that he was working to answer some questions from Bolton.

Still, both Webb and Thomas Fulton, chief actuary for Bolton Partners, said that they expected there to be a cost associated with the program. And Webb said that although the number may be tweaked, it would likely still be a substantial figure.

"I don't see it going from $258 million to $2.5 million or $25 million," he said.

Through a spokesman, Nutter said: "It is my hope that City Council will take action and pass the DROP legislation almost immediately upon their return to session in January because we can't afford DROP anymore."

City union leaders have opposed ending DROP, questioning Nutter's numbers and saying that any changes must be bargained. City Solicitor Shelley Smith has provided an opinion to Council, stating that Council could kill the program, although she noted that the outcome of any court challenges was unclear.

DROP allows city workers to set a retirement date up to four years in advance. At that point, their pension benefit is frozen and they start accruing pension payments in an interest-bearing account. Workers get those payments in a lump sum when they retire, in addition to their full city pension.

Elected officials can use a loophole that allows them to run again, resign for a day to collect the payout and return. Councilwoman Joan Krajewski did just that in 2008, collecting $274,587.

Six Council members - Frank DiCicco, Jack Kelly, Donna Reed Miller, Frank Rizzo, Marian Tasco and Anna Verna - are set to receive $2.2 million in DROP payments by 2012.

DiCicco and Rizzo have said they'll run again in the May primary, although DiCicco says that if re-elected, he would donate his salary back to the city or city-related nonprofit organizations.

The other four remain undecided. Future elected officials won't be allowed in DROP, under state law.