In response to the substantial increase in contributions to the New York State Pension Plan, Westbury Village Mayor Ernest Strada recently joined other elected officials from Nassau, Suffolk and Westchester counties to call for an immediate reform of the pension plan. Mayor Strada is past president of the Nassau County Village Officials Association (NCVOA).

"We have requested both the State Comptroller and the New York State Legislature to immediately review the current pension needs and seriously consider implementing a new formula that will not strain and crush the budgets of all municipalities," said Mayor Strada.

In 2003, the state legislature approved the restructuring of the pension plan and imposed a minimum annual contribution rate of 4.5 percent of payroll, which is the rate for December 2003 billings. However, billings for December 2004 are expected to jump 12 to 17 percent with the higher rate applicable to police officers and firefighters.

"This significant increase is completely unnecessary," said Strada. The increase in 2004 pension costs exceeds all local government aid by 126 percent. Additionally, the state pension fund is back up to $106 billion. "There is no logical reason why the state comptroller's office should burden the residents of Westbury with such an excessive and unwarranted tax increase," he stated.

Strada is supporting the position of the Tri-County Municipal Officials Association and the New York Conference of Mayors to modify the pension process in the following ways:

( Enable local governments to use their existing reserve funds to help pay the huge spike in the pension plan obligations;

( Authorize local governments to create and set aside local monies in a reserve fund for future pension contributions;

( Give local governments the flexibility to pay the pension bill by January 15 instead of the current December 15 requirement; and

( Modify current actuarial methods used to determine pension contribution rates, including:

a) The retirement system currently uses a "smoothing" technique for measuring assets whereby it averages gains and losses of equity investments over a five year period, but places a cap on the size of the investment gain that can be included in the valuation calculation. This cap should be removed to allow for a more accurate measure of system assets.

b) Expand the amortization period of recent benefit enhancements from 15 years to 30 years; and

c) Place reasonable limits (e.g. 2-3 percent of payroll) on the amount pension contributions may increase from year to year.

"We hope our state elected officials will understand the magnitude of this dilemma and enact reasonable legislation that will prevent unnecessary fiscal burdens from being placed on our village and our residents," said Strada.