Philadelphia City Council is set to eliminate the controversial DROP retirement program for elected officials. Council will hold a hearing on the issue Wednesday.
Philadelphia City Council is set to eliminate the controversial DROP retirement program for elected officials. Council will hold a hearing on the issue Wednesday.[audio: 100308SPDROP.mp3]
The Deferred Retirement Option Plan allows city employees to pick a retirement date four years into the future, and have pension payments deposited in an account so they get a nice lump sum payment when they actually leave.
The program was intended to help the city plan for the loss of experienced workers. But elected officials also signed up for the large retirement payout.
The practice was widely condemned as abusive, and last year, the state legislature banned the program for future politicians.
The current Council bill brings city rules into conformity with the state law, but it doesn’t affect the seven Council members who have already signed up for the program.
Zack Stalberg from the watchdog group the Committee of Seventy says those who already signed up should leave office once they get their payouts.
Zack Stalberg: I think they have a moral obligation to leave if they agree to enter this particular pension program. The one day resignation has been deemed to be legal by the city solicitor but that doesn’t make it right.
Stalberg says Council members who’ve taken advantage of DROP may find it’s an issue in the 2011 elections.