Montgomery County Executive Marc Elrich\u00a0(D)\u00a0this week\u00a0said he will not veto a bill that transfers key responsibilities for managing the county\u2019s pension system from the chief administrative officer to a volunteer board \u2014 despite his\u00a0concerns about its implications.\u00a0<\/p>\n
In a\u00a0Monday\u00a0memo to\u00a0County\u00a0Council President Natali Fani-Gonz\u00e1lez (D-Dist. 6), Elrich said\u00a0the council \u201cis trying to fix something that isn\u2019t broken and, in doing so, is breaking something that has worked exceptionally well.\u201d\u00a0<\/p>\n
Pension benefits for retired county government employees are overseen by\u00a0the 13-member\u00a0volunteer\u00a0Board of Investment Trustees\u00a0in collaboration with the\u00a0chief administrative officer.\u00a0\u00a0<\/p>\n
The Board of Investment Trustees is managed on a day-to-day basis by an\u00a0executive director, who has historically\u00a0been appointed\u00a0and supervised\u00a0by the county\u2019s chief administrative officer.\u00a0<\/p>\n
A second volunteer board, the Consolidated Retiree Health Benefits Trust Board of Trustees, oversees other post-employment benefits for retired county government employees as well as for Montgomery County Public Schools\u00a0(MCPS)\u00a0and Montgomery College retirees.\u00a0<\/p>\n
Last month, the\u00a0council voted to pass Bill 28-24, which among other changes gives the Board of Investment Trustees the power to hire and fire its\u00a0executive director under the county\u2019s merit system. The chief administrative officer would still\u00a0be\u00a0responsible for\u00a0recruitment and\u00a0identifying\u00a0qualified candidates for the role.\u00a0<\/p>\n
Currently, the chief administrative officer is also responsible for selecting an actuary for the county pension system and\u00a0setting the variables\u00a0used to\u00a0determine\u00a0the county\u2019s annual contribution to the pension fund.\u00a0<\/p>\n
Rich Madaleno, the county\u2019s current chief administrative officer, told Bethesda Today on Thursday that key variables impacting the county\u2019s annual contribution include projected cost-of-living increases, inflation over time and\u00a0life expectancies of various employee groups.\u00a0<\/p>\n
Under Bill 28-24, those responsibilities would also shift to the Board of Investment Trustees, according to a council staff report.\u00a0<\/p>\n
\u201cWe are moving from having the concentration of decision-making in the hands of one person to expanding it to the board to benefit us with increased transparency, accountability, and so that we can benefit from the expertise and professional experience of all the board members,\u201d Councilmember Kate Stewart (D-Dist. 4) said before the March 17 vote on the bill.\u00a0<\/p>\n
The council vote to adopt the bill was unanimous except for Vice President Marilyn Balcombe (D-Dist. 2), who was absent from the\u00a0March 17\u00a0meeting.\u00a0\u00a0<\/p>\n
The council rejected\u00a0a number of\u00a0amendments to the bill\u00a0proposed by\u00a0Elrich\u00a0that would have kept more responsibilities with the chief administrative officer.\u00a0The bill became law without Elrich\u2019s signature.\u00a0The county executive has 10 days after the passage of a bill to approve or veto it.\u00a0<\/p>\n
Differing perspectives\u00a0<\/p>\n
Three unions\u00a0representing\u00a0the county\u2019s police officers, career\u00a0firefighters\u00a0and non-uniformed county government employees, respectively,\u00a0supported the proposed changes.\u00a0\u00a0<\/p>\n
In a\u00a0joint statement on Jan. 26<\/a>,\u00a0the groups wrote that\u00a0keeping key responsibilities\u00a0with\u00a0the chief administrative officer\u00a0\u201ccreates an unacceptable risk of a conflict of interest between the temporary political demands [of] the County, and the need to ensure that the plan is appropriately funded in order to meet its long-term obligations to the County employees.\u201d\u00a0<\/p>\n According to Madaleno, most current employees who are eligible for county pensions are in the public safety sector. Others, including many MCPS and Montgomery College employees, participate in the state pension system.<\/p>\n Elrich and other opponents of Bill 28-24 \u2014 including the Montgomery County Retired Employees Association and the MCPS Retirees Association \u2014 argue that actuarial and other consequential decisions should be made by the county, rather than by volunteer board members.\u00a0<\/p>\n In a\u00a0Jan. 27 letter to the council<\/a>, the Montgomery County Retired Employees Association wrote that members of the Board of Investment Trustees recognize that they \u201care not actuarial experts.\u201d Instead of shifting more responsibility to the board, the association said the council should support shared responsibility with the county\u2019s chief administrative officer.\u00a0<\/p>\n Elrich in his memo wrote that shifting responsibilities away from the chief administrative officer \u201ccould jeopardize the county\u2019s AAA bond rating, driving up costs for future capital bonds and financial services that taxpayers will ultimately bear.\u201d\u00a0<\/p>\n Asked for comment on Elrich\u2019s memo, Fani-Gonz\u00e1lez on Thursday told Bethesda Today that the council\u2019s decision on Bill 28-24 \u201cbrings greater accountability into key decisions\u201d\u00a0impacting\u00a0the county\u2019s pension system.\u00a0<\/p>\n \u201cThe County Executive and Council still have oversight of the Board of Investment Trustees as the [county executive] appoints them subject to council confirmation,\u201d Fani-Gonz\u00e1lez\u00a0said.\u00a0<\/p>\n Despite his concerns about the implications of Bill 28-24, Elrich\u00a0indicated\u00a0in his memo Monday that he would not veto it because it had the council\u2019s unanimous support. Only seven votes are needed\u00a0for the\u00a011-member\u00a0council\u00a0to override a veto<\/a> from the county executive.\u00a0<\/p>\n \u201cUnfortunately, the full impact of this decision may not be apparent for years,\u201d Elrich wrote in the memo. \u201cI remain hopeful that future policymakers will take a closer look at what has been changed and why it matters.\u201d\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"Montgomery County Executive Marc Elrich\u00a0(D)\u00a0this week\u00a0said he will not veto a bill that transfers key responsibilities for managing…\n","protected":false},"author":2,"featured_media":564776,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[39],"tags":[28,3,147,530],"class_list":["post-564775","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-news","tag-personal-finance","tag-personalfinance"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/564775","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=564775"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/564775\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/564776"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=564775"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=564775"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=564775"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}