Nick Evans, Fargo, Published June 09 2012
Only Gehrig is focused on pensionsPensions have been getting a lot of news coverage lately due to the fact that many pension funds are severely underfunded as a result of low interest rates and lackluster investment returns. Because of this, many local and state governments, along with businesses, are enacting plans to reduce their pension liabilities or rid themselves of these plans altogether.
Here in Fargo, however, the underfunded pension plans provided to city employees as part of their benefit package get very little attention, even with city commissioner elections Tuesday. The idea of reform was brought up at a recent City Commission meeting, but it was rejected and met with indifference; the status quo was accepted. One has to wonder why that is.
Why are we willing to spend $1 billion on a diversion around the city but unable to come up with a way to de-risk the city’s retirement plan? Could it be that current city leaders don’t think residents understand the financial risks associated with a defined-benefit pension plan? Do they think we only understand earth levees, sandbags, and river levels? Why are we not talking more about the fact that the city has budgeted a 29.7 percent increase in funds to be contributed to the Pension Trust compared to last year? This a major issue that deserves attention.
A vote for Anthony Gehrig in Tuesday’s City Commission race will be a vote to in the right direction to deal with this issue. Gehrig realizes the city must act to de-risk its pension plan and move to a retirement plan similar to what most businesses in and around Fargo offer, a 401(k)-style. The city should not be subjected to the risk and volatility of the stock market. Gehrig has made this a major point of his platform, which is what this issue deserves.