Federal Judge Won’t Issue Ruling in Pension Fight Between City, Public Safety Workers

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A U.S. District Court Judge has declined to issue a ruling in a decade-long dispute between the city of Annapolis and its retired public safety workers.

The dispute, explained by the Capital Gazette:

A federal judge has declined to wade into a 12-year dispute between the City of Annapolis and retired public safety workers over pension benefits.

Senior U.S. District Court Judge for the District of Maryland William M. Nickerson issued an opinion on Tuesday dismissing the city’s claims for declaratory judgment in its case against some 60 retirees. The city filed the federal action in August, after a 10-year old case filed by the retirees against the city was reopened in Anne Arundel Circuit Court.

The city sought to have changes to its retirement program over the past year declared constitutional and consistent with state law. This was after the retirees filed their own motion for declaratory judgment in Anne Arundel Circuit Court in June in light of the changes to the retirement program.

[…]

Former Annapolis police and firefighters are classified under four retirement plans. Individual retirees receive benefits from the plan in place upon their retirement. Two of the plans contain language in the city code tying pension increases to active-duty employee salaries.

“Each retired member’s pension shall be increased by the same percentage as any increase in the pay scale for members of the same rank and years of service who are on active duty,” the code reads.

Retirees sued Annapolis in 2002 seeking retroactive payments dating to 1995. After six years of legal battles, the state’s Court of Appeals ruled in favor of the retirees. The Circuit Court of Anne Arundel County later issued a declaratory judgment for pension increases, despite a premonition from then-Mayor Ellen Moyer that the ruling would bankrupt the city.

The city’s retirement plan liabilities increased by $6.2 million because of the ruling, according to a 2013 report produced for the city.

Annapolis had suspended adjustments to police and fire retiree benefits since 2009. City employees did not receive pay increases during that time period.

In Oct. 2013, the city announced a deal with its four public-sector unions on pay increases. Employees would receive a 10-percent raise over the next three fiscal years. Retirees would receive annual 2-percent increases, regardless of future city pay increases.

“Thus, the Retirees would receive only a 6 percent pension increase while active members would receive a 10 percent increase in pay,” Nickerson’s opinion reads.

The changes funded the retirement plan by 100 percent, according to the city.

The Annapolis City Council says it is deciding how to move forward in light of the ruling.

 

Photo by Joe Gratz via Flickr CC License

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