Rendell on DROP: 'If I knew then what I know now...'


At long last, Gov. Rendell, whose mayoral administration gave birth to the city's Deferred Retirement Option Plan (DROP) in 1999, has contributed his two cents on the future of the program, which Mayor Nutter wants to eliminate because is allegedly costs the municipal pension fund $22.3 million a year.

At an unrelated appearance in Harrisburg Thursday, a reporter asked Rendell whether DROP was a mistake.


“We had no idea it would be implemented the way it was implemented. We had no idea elected officials would take advantage of it," Rendell said. "What sold us on it was that it was a way to reduce overall workforce at cost that was projected to be a bearable cost. If I knew then what I know now, obviously we wouldn’t have done it."


Rendell seems to be troubled less by the cost of the program then by the fact that elected officials have lined up to take advantage of it -- the part of it that particularly inflames the public.

DROP allows employees to begin collecting their pensions in an interest-bearing fund over the last four years of their employment, while also collecting their paycheck. In theory, it encourages public safety employees to work longer, or actually encourages long-term employees to retire earlier. Critics have argued that it serves no purpose for elected officials, who have walked away with lump-sums of more than half a million dollars upon leaving the city.

Nutter's study, released Aug. 3 by Boston College's Center for Retirement Research, found that cops and firefighters were staying less than a year on the job, on average. Other workers were staying more than a year, but all were collecting their pensions earlier than they would have without DROP, the study found.

Nutter proposes to eliminate DROP altogether. City unions are lobbying City Council on proposals to tweak the program to eliminate its costs. Hearings are expected in the fall.

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