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Astorino Rejects Cuomo’s Pension Plan As “Crack Cocaine”

Posted By Joseph Spector On February 1, 2013 @ 1:37 pm In Other | Comments Disabled

Westchester County Executive Robert Astorino said he opposes Gov. Andrew Cuomo’s proposed pension-smoothing plan, saying it would provide a short-term fix but would lead to more troubled local government finances in the future.

[1]“It’s like crack cocaine. You’re going to get a quick high today, but you’re going to end up in the gutter,” Astorino said in an interview yesterday with Gannett’s Albany Bureau.

Astorino said Cuomo’s pension plan—which would lessen the growth in soaring pension costs for local governments and schools over the next 25 years—is bad fiscal policy.

“I think it’s a bad scheme, and it just makes it worse in the future,” said Astorino, a Republican who has been speculated as a potential 2014 gubernatorial candidate against the Democratic governor. “If the leaders of 10 and 20 years ago had decided to confront the issue of pensions then, instead of kicking the can down the road, we wouldn’t be in this situation today. And we shouldn’t do the same to the next generation.”

Astorino’s comments are the strongest yet against Cuomo’s plan. Many local leaders said they appreciate Cuomo’s efforts, but Syracuse Mayor Stephanie Miner, a Democrat, has also raised concerns.

Westchester County last year begrudgingly entered into a pension amortization program through the comptroller’s office. It lets local governments borrow off the pension fund and pay back the costs with interest over 10 years. A growing number of governments are doing it [2], Gannett’s Albany Bureau reported last month.

Astorino said the county had little choice but to enter the program because of the county’s growing pension bill: It grew from $3 million in 2001 to $91 million this year.

But Astorino said Cuomo’s plan is even worse than amortization because it relies on the expectation that the cost break today would be recouped through future, uncertain savings. He urged state officials to reject the proposal.

“This is not a savings. It’s really a money grab from tomorrow for today,” he explained.

Astorino offered an alternative. He said schools and local governments should be allowed to bond pension costs on the open market, rather than borrow through the pension fund. The state’s pension fund is charging about 3 percent interest this year; it might be half that on the open market.

“It’s sort of like going for a mortgage and being forced to use a particular bank at 6 percent interest when if I shop around I can get it at 3 percent,” he explained. “Who in their right mind would do option A? But that’s what we are in the position of. They are forcing us to use them and only them.”


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[1] Image: http://statepolitics.lohudblogs.com/files/2013/02/astorino1.jpg

[2] A growing number of governments are doing it: http://www.wgrz.com/news/article/194895/13/As-Pension-Costs-Grow-Some-Local-Governments-Turn-To-Borrowing