Public Pension System
Fri January 20, 2012
Cuomo's proposed Tier VI
During Tuesday's unveiling of Andrew Cuomo's Executive Budget, he proposed adding a new Tier VI to the public pension system. As he described it, it would work more like a 401k account. Newly hired employees, or as the Governor calls them the 'unborn,' would enter into a plan that would feature a voluntary option for a defined contribution plan. It also offers a portability feature not currently available to state employees and raises the retirement age from 62 to 65. Members of the legislature, particularly Assembly Democrats who have strong ties to unions across the state, may not be willing to go along with the plan.
Bob Ward, the Deputy Director of the Rockefeller Institute of Government, says it could lead to a legal battle between Cuomo and the Legislature. According to Ward, Cuomo would have the upper hand. 'The Court of Appeals has said the Governor has great power in using the budget process,' Ward tells New York NOW, 'not only his popularity in a public sense, but using in a legal sense the construction of the budget itself to limit the legislature's opportunities to change his proposals.'