The teachers union and Mayor Bloomberg announced a breakthrough deal last night on a pension-reform package that the mayor estimated would save the city $2 billion over 20 years.
It was the first significant pension change won by Bloomberg since taking office in 2002 — and followed a series in The Post that disclosed that some city workers, especially cops and firefighters, were routinely collecting six-figure retirement checks.
The tentative deal — unexpectedly announced in a 7 p.m. press release — preserves the right of teachers to retire at age 55, a benefit the United Federation of Teachers adamantly refused to surrender.
Two weeks ago, Gov. Paterson convinced the state’s two largest unions to accept a new Tier 5 retirement age of 62, instead of 55, to stave off massive layoffs.
The key points of the new deal, which requires approval from Albany, include:
* New teachers would contribute 4.85 percent of their pay to their pensions for 27 years, when the payments would drop to 1.85 percent. Currently, teachers chip in 4.85 percent for just 10 years, before going to 1.85 percent.
* Starting this September, teachers won’t have to report for two days of “professional development” before Labor Day.
* To obtain retiree health-insurance benefits, new teachers would have to put in at least 15 years instead of 10. To vest in the retirement system, they’d have to stay on the job for 10 years, double the current minimum.
* The city would guarantee an annual 7-percent return on the assets of the teachers’ tax-deferred retirement account, down from 8.25 percent.
Bloomberg described the pact as a “very good deal.”
“It will save us a lot of money over the long term — not as much right away, but we have to address the long-term problems now,” he said.
Officials said the savings to the city would start at $15 million in fiscal 2012, growing by $12 million each year as new teachers flow into the system.