Monday, August 06, 2007

What Merger Savings?

It's beginning to look more and more like the consolidation of Indianapolis' law enforcement agencies will result in little, if any real savings. Originally, Mayor Peterson promised $9 million in savings from the merger of IPD and the Sheriff's Department. His admnistration now concedes the savings has been no more than $7.4 million. And that number could fall several million more as the Star's Brendan O'Shaughnessy reports today. Unlike IPD officers, Sheriff's employees participate in social security. The city had hoped those employees would opt out of social security like IPD employees but they chose not to opt out, meaning the city has to continue paying matching contributions of $1.3 million annually. Deputy Mayor Steve Campbell says the city anticipated that happening all along and is not the reason for the reduced savings. The city's legal counsel, Kobi Wright, also counters that the city will eventually realize savings with new hires who don't participate in social security and, therefore, will not require matching contributions from the city.

Nonetheless, current IPD officers are now complaining they are being short-changed and may sue the city. If the city were to make up for the difference in compensation to the IPD officers, it would cost the city $4 million annually. O'Shaughnessy writes:

Former IPD officers are grumbling about what they now perceive as unequal compensation because former sheriff's deputies receive a city contribution toward Social Security.

Officers enrolled in the Social Security program pay a 6.2 percent tax, with a matching amount contributed by the city. IPD officers have never been part of Social Security, unlike sheriff's deputies.

Vince Huber, past president of the city' police union and a member of its executive board, said many former IPD officers are unhappy they aren't getting an equalizing benefit, such as a 401(k) employer-match program.

"There's a lot of talk about a lawsuit," said Huber. "It's not fair to have people getting different compensation for the same job."

In a letter to council members one year ago, Huber warned that the Social Security issue would cost the city regardless of which officers end up in the program. He said council members should not be surprised when future contract talks bring up a matching benefit for former IPD officers.

Kobi Wright, the city's lead attorney, said all Indianapolis metropolitan police officers receive equal compensation.

"It's the same base salary and additional negotiated benefits in the contract," Wright said. "The city can't control a determination made by the federal government about Social Security."

9 comments:

MW said...

Finally the Star is coming out and speaking truth.....Finally someone stepping up to the plate on this

Anonymous said...

The benefits are not equal, I hope they sue. Looks to be an open and shut case to me

Anonymous said...

But they take home 6% more than the former sheriff's employees. Do they want to give up that take home pay?

Anonymous said...

Refresh me, Bart... how is the city saving money?

Anonymous said...

When are we going to stop letting firefighters and police run for public office?

Enough of this double-dipping, conflict-of-interest baloney!

Anonymous said...

Something tells me this isn't a good day for Wilson.

Anonymous said...

11:08, to answer your question..YES!! we would. The former MCSD deputies had a chance to get out of it and have their benfits reduced to our level. Guess what? They voted to stay in by well over 90% And just to make sure they did..others filed a law suit to stay in SS.

I seriously doubt this isn't a substantial benefit and the MCSD guys were smart to stay in. Now that we're all one big happy police department the former IPD guys are entitled to the same benefit and should be able to opt into SS.

Anonymous said...

We tried to tell you it wouldnt save money or work!! If you reelect Peterson you dont get what you pay for. Deconsolidation is the only way!!!

Anonymous said...

The opt-in for Social Security is a special federal exemption for such instances.

It's not an original problem. There is precedent.

And no, former IPD officers who aren't in SS cannot opt in.

It's the feds' rules. Try to argue with them, then get back to us.