Home > Budget, CEO, commission > DeKalb budget strained by pensions; personnel

DeKalb budget strained by pensions; personnel

February 16, 2011

I attended a public meeting on DeKalbs budget held by commissioners Elaine Boyer and Kathy Gannon on Tuesday. It was an eye opening experince as to why the taxpayers in DeKalb should be concerned in the next week or so. The county commission is scheduled to vote February 22nd on whether or not to approve or amend a 12% increase in property taxes that CEO Burrell Ellis has proposed. The CEO and others feel that a tax increase is the only way to balance a budget that started the year off 7 million in the hole.

At the meeting, a financial consultant laid out what is at stake when the commision votes. In his estimation, the county cannot continue down the path it is currently on. The worst case scenario showed the property tax digest falling once again in 2011 and personnel costs continuing to increase. In that scenario, the county would not be able to maintain services at the the present tax rate. Something will have to give. Either a tax hike, which many in the audience were against, more service cuts or massive overhaul of the benefits and pensions of county employees. when looking at the numbers, it is obvious that the pension system is killing the budget, along with the bloated payroll. I have posted in the past how the county has ignored the recommendations of a Georgia State University audit that said the county should eliminate or consolidate positions within the county government to reduce costs. That will address some of the short term pain, but a closer look at the pension system shows it is the 800 pound gorilla that no one wants to tackle. Because of state law, the county has to maintain a certain level of funds to pay out pesions to county employees. In 2011, the county is on the hook for nearly 50 million dollars so that the pension remains viable. But lets take alook at this pension. Way back in the day, government employees were compensated less than their private sector counterparts. To address this governments around the country gave their employees very gracious health and pension benefits to hire and keep good employees. Today, that system is bankrupting local governments, who have to continue to pay out benefits to retirees and help cover employees healthcare. Add to that the downturn in the stock and bond markets, and local goverments are finding it hard to keep pace with the required minimums set by law. So what is the solution?

In the private sector, when your 401k tanked in the last couple of years, you were on the hook for the losses. That is not the case for government funded pensions and healthcare. We the taxpayers have to foot the bill to ensure that DeKalb’s pension system does not go into default. So the 50 or so million dollar tab that the pension system needs to remain viable is passed on to us, the taxpayers. Raising taxes today will not solve the pension and benefits problem that will continue for years to come. If the county wanted to fix this, they could force employees into a private system such as plans similar to 401k where employees determine how much of their pay goes towards their retirement. Any future employee would be directed into this new pension formula thereby taking the responsibility off the taxpayer a placing it on the shoulder of the employee. The county could also ask employees to pay higher deductibles for their healthcare. High deductible plans are the path that many government and private sector employees are going to help balance their budgets.

Let me go on the record as saying I am not totally against a tax increase to help balance the budget. What I am against is the county asking me to send them more of my income to balance their budget when they have not trimmed as much fat as possible. Public safety should be their primary concern. Quality of life issues like libraries and parks may have to take a temporary cut, but if the county would address benefits and pensions, the cuts to quality of life programs would not be hit nearly as hard.

I encourage all DeKalb residents to contact their commissioners and tell them that they must act on health and benefits before they pass a tax increase. In this economy, few people should have to pass more of their hard earned dollars to the county, when the county has not put forth an effort to curb its spending.

Another budget town hall will be held at the Tucker Library, 5234 LaVista RoadTucker, GA 30084 on Thursday February 17th at 7 pm.

Want more info on the DeKalb budget? Check out these links

CEO’s proposed budget

BOC budget information

Budget Opinion

    March 4, 2011 at 5:02 pm

    Hi, working on an article I am a freelancer and I am currently doing a piece on the mis-management of pension funds and accounts. Can anyone tell me how Mr. Edmund Wall became Chairman of the Pension Board? was he elected or appointed? Did Burrell Ellis appoint him? I am curious about their connection or relationship? Any help or guidance is much appreciated!

  2. MS
    February 22, 2011 at 7:38 am

    I think everyone is under the misconception that the county workers are making more money than we are.
    I have seen my pay reduced for the last 5 years. Higher pension contributions, higher insurance premiums and no cost of living increases. Many of us work 2 and 3 jobs to make ends meet , thus reducing time spent with our families. Our families have gone without and we have suffered furloughs along with many of the private sector employees.
    I came to work for DeKalb over 18 years ago and have served the citizens of this county with pride and a goal to go above and beyond what was called for. Now I am made to feel that I am less than a second class citizen. I have given blood, sweat and everything I have to the citizens of this county and all I have ever asked is to be treated fairly.
    The public needs to choose whether or not they are willing to place their safety at a risk. Theirs, as well as their families. The reduction of service will include public safety. The system already drains an already tasked workforce. Longer waits on 911 calls, less manpower to respond to emergency calls. Is this what we all want? I am also a tax payer in this county and I can assure you it is not.

  3. JB
    February 21, 2011 at 4:19 pm

    The only employees that are benefiting from the pension are the ones that have already retired. Please do not make it sound like any recently hired (last 10 years) are on a gravy train pension ride. Prior to 10 years ago it was standard to get an 5% salary raise every year and only have to pay 1/2% of salary into the pension.

    This resulted in very high retirement salaries (which is what one’s pension payment is based upon) and very low contributions into the pension fund by these employees. They were capped at 82% of salary after 30yrs work.

    Current employees are capped at 67% at 30yrs, pay in 8% of their salary to the pension fund (which will likely go up more) and most have not seen a raise in the last 5-6 years are are not likely to see one in the next 5-6. The result is paying in more money and retiring with way less.

    Maybe the current situation is more equitable compared to the private sector, I have no idea. However, it seems foolish to not take a look current retirees pensions and reevaluate them somehow. By which I mean lower them to a sustainable level. flame away…

  1. February 16, 2011 at 1:29 am
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