Mayor: Root of pension problems goes back more than 60 years

MEMPHIS, Tenn. — Wednesday, Mayor A C Wharton told WREG he welcomes any and everyone’s help to solve the city’s pension problems. An estimated $600 million deficit in the pension forced the city to raise health care premiums.

Memphis made big cuts to health care coverage for all city workers and retirees to cover the city’s pension problems. However, protesters want to know why the money is not already there.

Mayor Wharton said it’s complicated.

“It goes back 25 or 30 years to the very design of the plan.”

A change in state law changed how the city approached the budget. It forced more money into the pension and because of the city’s poor planning put the financial future of tens of thousands of workers and retirees in danger.

Wharton said the problem started before most current workers were even born.

“You’ve got a plan that was designed in 1948, and things have changed so much,” he said.

Financial planner Martavius Jones said the city set aside smaller amounts of money than what was needed since at least 2008.

“For the city of Memphis, they were not putting in the required contribution to keep up with what was required. So we were putting in less than what was required in order to shore up the plan.”

He said, even though the ball was obviously dropped, no one person or even administration is solely to blame for the current situation. Instead, he said there are plenty of people to blame for getting the city in this jam. He also believes it will take that many people to get us out.

“This community has to be prepared for more taxes. Employees have to be prepared to pay more for their retirement in order to get beyond this.”

Jones said another big reason why we’re facing pension problems now is that people are simply living a lot longer than they used to.

9 comments

  • King Willie

    That’s rite it wasn’t my fault! I wuz a good mayor. The chump firefighters and cops loved me. So did the big developers – they loved me so much they gave me cash and land for spending your pension on their pork projects!!

    So bend over – your house value is going down when the mortgage payments go up! Your rent is going up! But the folks still love me. Let me feel the love!

    • poolgirl2

      KW, bless your little heart! Maybe those charter schools will help line your pocket. Will you pay any taxes on those revenues?

  • XEROX

    Regardless of when it started, as someone who is SUPPOSED to be the city mayor, and your council clowns, it’s your job to do what’s right. All the waste on projects no one cares about is shameful and THAT will be your legacy.

  • poolgirl2

    Stop whining about the past and get this problem solved! Take the bull by the horns, come with a 5 year plan to reduce spending and increase income. Everyone played, everyone pays.

  • Larry Boothby

    For the love of God, are you guys going to ever investigate the massive debt, this council and Mayor have loaded on the city? Stop shilling for the Mayor and DO YOUR JOB!

  • Diana Hudson

    Wonder if all the high paid execs that got “jobs reevaluated” and increases would help me to pay bills and buy groceries when the city takes all my pension and some to have health benefits I was understood I would have when I retired and paid for for 25 years

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