Nutter urged to drop pension perk

A government-reform group yesterday urged Mayor Nutter to bar elected officials from a controversial retirement benefit and suspend the program for all other employees pending an independent review of its financial impact on the city's pension fund.

Nutter, who supported removing elected officials from the Deferred Retirement Option Plan as a city councilman, had not yet seen the letter from the Committee of Seventy, Nutter's spokesman Doug Oliver said.

The program allows employees to announce a fixed retirement date, usually four years in the future. They then begin amassing pension payments while still on the job collecting salary. They collect a lump sum at the end of the four years. The program gives city departments and the pension board an advance handle on retirement impacts.

At least nine elected officials - including Mayor Street, District Attorney Lynne M. Abraham, and five City Council members - have taken advantage of the program, drawing fire from critics who said the 1999 law was not intended for politicians. Payouts have ranged generally between $200,000 and $500,000.

While most city employees are required to retire at the date they specified, the law allows some to collect their DROP payment, retire for a day, then return to work as "rehired retirees," according to the city law department. Usually only key employees are granted this waiver, but City Councilwoman Joan Krajewski and City Commissioner Margaret Tartaglione are collecting their DROP payments this year and continuing to serve.

They each retired for a day last week to jump through the legal loophole.

The Committee of Seventy's president, Zack Stalberg, wrote that The Inquirer's stories about the loophole prompted his letter. The Inquirer reported on Friday that Council members Anna C. Verna, Frank DiCicco and Frank Rizzo Jr. had joined Krajewski in DROP. The Daily News on Saturday reported that Councilwoman Marian B. Tasco had also joined.

Stalberg wrote that the committee's recommendations "are important not only to the city's fiscal health, but also to your commitment to restoring the voters' trust in the integrity of city government and in their elected officials."

In 2003, the Board of Pensions voted to continue DROP indefinitely, citing an "immaterial" cost to the pension fund, which currently has only 53 percent of the cash required to fund its pension liabilities.