Heard in the Hall

Council moves forward to save DROP

As promised, City Council on Thursday introduced a bill that will preserve the controversial DROP retirement perk for all city workers, including the Council members themselves.

49 comments

Council moves forward to save DROP

POSTED: Thursday, May 26, 2011, 10:54 AM

Jeff Shields

As promised, City Council on Thursday introduced a bill that will preserve the controversial DROP retirement perk for all city workers, including the Council members themselves.

In a press release, Council President Anna C. Verna said a compromise bill will eliminate DROP's cost, while avoiding costly litigation that is sure to follow if the prized benefit is denied city workers. That bill would shift the guaranteed 4.5 percent interest rate on DROP funds to the U.S. Treasury rate, saving an estimated $1 million a year, and push back DROP eligibility to two years after workers reach retirement age.

"I know there has been immense pressure to eliminate the DROP because of its cost,” which has been estimated to be at least $100 million since its inception in 1999, Council President Verna said. “The bill introduced today preserves DROP as an option. It is designed to eliminate its cost for all employees in currently open pension plans who are not yet eligible to retire. My colleagues and I believe this is the better approach, but we look forward to exploring the alternatives at the scheduled hearing on the bill.”

A hearing is scheduled for June 8.

The bill does not change the status of current elected officials, who can still join DROP. All newly elected officials are excluded by a 2009 state law.

Seven City Council members have already joined the Deferred Retirement Option Plan, walking away with lump-sum payments from between $190,000 to more than $500,000. Ten others are still eligible. They are Jannie L. Blackwell, Blondell Reynolds Brown, Darrell L. Clarke, W. Wilson Goode Jr., Bill Green, William K. Greenlee, Curtis Jones Jr., Brian J. O'Neill and Maria Quinones Sanchez.

Six of the 10 have pledged not to join DROP in the future. Blackwell, Clarke, Greenlee and O'Neill -- all of whom could collect lump sums of about $500,000 in four years if they joined DROP tomorrow -- have refused to make any promises about their intentions.

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49 comments

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Comments (49)

0 like this / 0 don't • Posted 5:31 PM, 05/26/2011

Please vote these pigs out of office. They are the absolute worst and Philadelphia will continue to be a second-class city as long as we have second (third? fourth?) class citizens representing us on City Council. What a bunch of unethical morons. We may not be able to fix Washington, but we can fix these folks.

— K362PA

0 like this / 0 don't • Posted 5:40 PM, 05/26/2011

Today the city of philadelphia has ended due the empty leadership of michael nutter and city council---thet are keeping DROP and raising TAXES ---wht would anyone ever vote or TRUST another elected official. MAYOR MICHAEL NUTTER we expect more from YOU

— the commodore

Comment removed.

0 like this / 0 don't • Posted 5:42 PM, 05/26/2011

DROP program was introduced in 1999,as an alternative to the traditional retirement track for TWO reasons:
1)To retain experience employees-especially police and firefighters-by giving them an incentive to STAY in their jobs for four years after they might have otherwise retired; and
2)To allow the department in which a DROP enrollee is working time to choose and train a successor.
Has these goals been accomplished, and if so, where is the study with statistical numbers to back the effectiveness of the program. If there isn't a study with numbers, then all DROP is, is a ponzi scheme, that employees and elected officials are sapping millions of dollars from the city pension fund!!!!

— Dadair1