City of St. Louis Wins Outright Victory for Taxpayers

Judge Rules in Favor of City’s Firemen’s Retirement System Overhaul

June 4, 2013 | 2 min reading time

This article is 11 years old. It was published on June 4, 2013.

firefighter

A judge has declared an outright victory for City of St. Louis taxpayers, allowing the City to terminate its existing retirement plan for firefighters in favor of a less expensive, but still generous, new plan.

Over the last decade every new dollar in the City’s budget has paid for rising pension costs. For every dollar the City has spent on a firefighter’s salary, it has spent another 75 cents for a firefighter’s pension. That’s more than triple the benefit to a non-uniform City employee. 

Today’s ruling by Judge Robert Dierker allows the City to terminate the Firemen’s Retirement System and start a new pension program, the Firefighters Retirement Plan. It also gives the City local control and frees the City of needing the approval of the General Assembly to make any changes.

“These are common sense, fair changes that I proposed,” said Mayor Slay. “I thank the Aldermen who stood up to do what’s right for taxpayers under enormous pressure. Alderman Craig Schmid took the lead by sponsoring the legislation needed to reign in skyrocketing pension costs.”

Because of steep stock market losses, the cost of the Firemen’s Retirement System has soared. It went from $6 million per year when Mayor Slay took office to $29 million, reflecting a 483 percent increase. Until today, there was no end in sight to the cost surge. But now, Judge Robert Dierker’s ruling will allow the City to start a new plan, effective February 1, 2013.

Under a new plan, any firefighter with 20 years or more with the department will see no change to his/her pension plan. Those with less than 20 years with the department will see two major changes effective February 1, 2013:

  1. Firefighters must contribute 9 percent to their retirement plan
  2. Firefighters who retire earlier than age 55 will have a reduced benefit

The new plan will also create changes to the disability benefit to reduce fraud and abuse. Under the new plan, any firefighter who is too hurt to work would get a full disability pension. But, if doctors consider a firefighter fit enough to do another job, he/she would get a smaller pension.

These substantive changes are projected to save nearly $5 million tax dollars in the first year alone and nearly $50 million over the next 30 years.

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