The Paying of Retirees Pensions Places a Financial Hardship on the MTA.

ACRE claims the MTA has an immediate financial burden paying the pensions for recent ACRE retirees. How is this possible? ACRE would not know if this were true, after all ACRE did not hire an actuary to perform an actuarial study to determine the Tier IV pension's cost factor. Common sense would indicate that no undue hardship has been assumed by the MTA to pay these pensions.

All ACRE members surrendered their Vanguard accounts once the contract was ratified. The MTA no longer has to contribute either 7% of an employees salary to the Vanguard accounts for employees with more than 19 years of service or 4% of an employees salary for employees with less than 19 years of service. The “mass exodus” that ACRE implied would happen, has not occurred. Approximately 22 Engineers have retired this year, and maybe 10 Conductors. The best estimate is that next year about 10-15 Engineers will retire and possibly 5-10 Conductors. Please explain how this many employees retiring places an instant financial impact on the MTA. Especially after the MTA now has the ACRE employees Vanguard accounts and is no longer required to contribute to them. And, oh yeah, each working active ACRE employee has to contribute 3% of their salaries to this MTA defined benefit pension plan. How much have you contributed to this plan already in 2004?

Most of these retirees left with a 42% or 43% calculation of their final average salary for their pension. One engineer left with a final average salary of $106,000.00 and after his Railroad Retirement Tier II is deducted, will receive approximately $2,700.00 a month for his Tier IV pension. He had to surrender his Vanguard account of approximately $100,000.00. How this number of retirees could potentially affect the MTA with their monthly pension payments in a financially negative manner is a mystery?

Train and Engine service members on Metro-North could have received the Tier IV pension in the 1999 contract for a substantially less cost factor. There would not have been any 3% employee contributions, less funds in the Vanguard accounts, and probably no zero. This did not happen because Richie Engel planned on retiring in 2000 and he notified Mike Doyle that he did not want to give up the funds in his Vanguard account. If Richie would have had to surrender his Vanguard account, then he would not put his support and local members behind the formation and implementation of ACRE. Another factor was Bottalico. He was not a Tier IV pension convert. He liked the Vanguard. Remember, Bottalico degraded the UTU LIRR deal after it was announced. He only became a pension advocate, after the LIRR ratified their contract. He then attempted to assume credit for bringing the pension to Metro-North. Of course he and Doyle performed this act in a span of about three weeks. Not a lot of time to complete an agreement that Doyle states has a “complicated benefit” such as the pension.