New York pension contribution costs lowered

The New York State Association of Counties warned as recently as Sunday of another expected pension contribution increase. It's a cost that has been vexing local governments and school districts since the recession and forced increases in what were already some of the nation's highest property taxes.

"We are still paying for when the bottom fell out of the stock market in 2008," said Orange County Executive Ed Diana, the association's president. "We can't overstate the impact that these increases have had on every single municipality in New York."

In 2011, Gov. Andrew Cuomo and the legislature created a new, less expensive tier of pensions for new hires to reduce the future cost to governments and schools. The state constitution prohibits lowering the pension benefits of workers and retirees already in the $158 billion pension system.

This year, the Legislature approved a plan with DiNapoli's advice to lower current costs even more than DiNapoli's plan by offsetting them against anticipated lower costs when the economy rebounds. DiNapoli had questioned that approach, and some local leaders, led by Syracuse Mayor Stephanie Miner, called it risky borrowing against a rosier future that may not materialize.

DiNapoli's current proposal is more conservative and based on gains in Wall Street investments already received and on an analysis by the independent consultant.

The change combines equity assets and nonequity assets, rather than separating them as has been done in the past. That serves to smooth out gains and losses and provides a dependable, and in this case, less expensive bottom line cost, DiNapoli said.