ALBANY — New York City taxpayers ducked a giant new pension bill Monday when the state’s highest court overruled lower courts to rule that the city didn’t have to make added pension contributions for the most recently hired cops and firefighters.
City officials estimated the savings to taxpayers at about $500 million over 10 years.
Police and fire unions have been battling for years to “equalize” benefits for their members since those hired after July 1, 2009 have been placed into a “Tier 3” with reduced benefits.
The city contributes 5 percent toward the 7.5 percent that most cops and firefighters hired before that date have taken out of their paychecks for pension purposes.
But the city doesn’t chip in anything to the Tier 3 hires, who are making 3 percent pension contributions.
Police union officials argued that the city’s payments — known as the “Increased Take Home Pay” program — date back to a deal engineered in 1963 that traded higher pay for enhanced pensions that the city was supposed to help fund.
There were several changes made through the years to state legislation authorizing the deal, but the city maintained that none of them entitled the newest hires to the same pact as the older ones.
State Supreme Court Justice Carol Edmead disagreed in a 2012 ruling that the unions hailed.
But in a 5-0 ruling Monday, the state’s Court of Appeals said its reading of the legislation was the same as the city’s, not Judge Edmead’s.
“None of the statute’s legislative history or the bill’s extensive fiscal note hints that the legislature aimed to countermand the city and extend the ITHP to Tier 3 police officers and justices,” the appeals panel decided.
“This would be a striking exception to the way public employee pensions in New York typically operate.”
The largest police union, the Patrolmen’s Benevolent Association, said it would keep pushing to get the same benefits for all its members.
“It is our belief that there should be equal pay and benefits for all police officers wearing the blue uniform of the NYPD,” said PBA president Patrick Lynch.