Solving our pension woes
Open letter to the City of Wheeling elected officials:
It was recently reported that Wheeling’s fire and police pension plans are nearly $53 million in the red. Wheeling Finance Director Michael Klug said that the city contributes much more into its pension funds than general fund money because of video lottery revenue from Wheeling Island Hotel and Casino Racetrack.
But as Ohio and Pennsylvania are getting gambling, the coffers will be reduced because of increased competition. There is only so much money to go around and Wheeling should not solely depend on gaming money, because eventually the funds will dry up.
Wheeling, yet again, has hired another consulting firm, Pittsburgh-based Duda Actuarial Consulting, to help determine ways to pay down their unfunded liability plans. The City needs to be more fiscally conservative and find ways to prevent the pension plans from going under. Chesapeake Appalachia paid the City of Wheeling $386,629 to lease potential natural gas drilling sites at Oglebay Park. Perhaps the city would listen to my opinions to this problem (I am not charging a dime for my advice), we could solve this issue.
The city manager has not yet decided what do with the proceeds from the natural gas lease. Instead of allocating these monies into the general fund, earmark the $386,629 and any further proceeds (14 percent royalties from gas productions) to pay down the pension plans. The city will still need to make their current payments to the plans and pay off more of the principle with this increased revenue that they will be getting.
Gov. Joe Manchin got involved with this issue to give Wheeling and other cities in West Virginia the option to eliminate these programs and pay off their funding shortfalls over the next 40 years.
Another suggestion I would make is to add for any future hiring to the state’s pension plan instead of the city’s.
Using the analogy of a conventional 40-year home mortgage under current rates, if an extra payment of $386,629 is made toward the principal of the loan, it will reduce the number of months to pay off the loan by 11. It is imperative that the city do this. We need to follow this money and see if it is spent correctly, but then again what do I know; I’m not an elected official.