Retirement contributions column draws fire from online readers
Letters to the Editor
- February 28, 2011
To the Editor,
I respectfully disagree with Mr. Shepherd’s editorial [“Filling in the hole: making responsible financial decisions for the Virginia Retirement System” by Jim Shepherd, Jan. 11, ]http://www.VirginiaBusiness.com] It la.cks historical context and balance.
The 5 percent VRS contribution was given in lieu of a raise in 1983. The contribution was cheaper for the state than a 5 percent salary increase. In large part, VRS is facing difficulty because administrations of both parties have deferred payments to it. Shouldn’t Mr. Shepherd have mentioned this essential fact?
Gov. McDonnell, who specifically pledged during his campaign not to rescind the state contribution, is a case in point. He recently deferred a $600-plus million contribution to “balance” the budget. Is this shell game the sort of “true leadership” to which Mr. Shepherd refers?
Unmentioned in all the discussions regarding VRS is that state employees enrolled in Optional Retirement Programs (ORPs) — such as TIAA-CREF — are also facing a 2 percent cut in compensation. ORPs are not in financial difficulty. (For VRS participants, the governor’s 5 percent cut in compensation would come with a 3 percent raise; ORP participants would simply see their compensation cut by 2 percent.)
Here’s a great question for Mr. Shepherd: Does changing who pays the 5 percent employee contribution add one cent to the VRS fund?
State employees haven’t had a raise in four years. And now that we’re coming out of the recession, we’re facing a 2 percent cut because Republicans childishly refuse to acknowledge that we have to increase revenue as well as demand efficient government.
Gov. McDonnell’s proposed skewering of underpaid state workers is grossly unfair.
Dr. Alexander S. Leidholdt
To the Editor,
The governor has proposed only a one-time $122 million payment on a debt owed the pension fund of $5.4 billion [“Filling in the hole: making responsible financial decisions for the Virginia Retirement System”].
This is inadequate and doesn’t begin to address the long-term solvency issue. Moreover by changing who pays the 5 percent from the state to employees does nothing to increase contributions to the system.
This is smoke and mirrors and ultimately an attempt to fund needed core government services by reducing state employee benefits. It is a broken promise and a broken proposal.
Suzanne J. Keller