Philadelphia’s City Controller has come up with a patch to help pump up the city’s sagging pension system.
Alan Butkovitz suggests offering cash buyouts to the oldest city workers to get them out of the most lucrative pension programs.
“About $6 billion out of $6.9 billion of what the city owes that the city doesn’t have the funds for are because of retirees that were in the system between 1967 and 1987,” he said.
The proposal would offer a lump sum payment to the pensioners, which would be worth far less than what they would get through years of payments. That discount is where the city finds savings.
“That would yield at a maximum up to $3.8 billion worth of savings on the $6.9 billion the city owes,” he said.
City finance director Rob Dubow calls the proposal interesting, but he says more research is necessary before offering buyouts.