Mayor Sanders announced an additional $88 million in projected savings Thursday to a system that was already billed as a $714 million savings during 25 years.
Sanders called it the largest cost saving measure in city history. It’s a retiree health care plan for city workers that is going better than expected.
“That actually turns out to be $802 million and that’s based on the elections people actually made” said Sanders.
The new system went into effect April 1 making full health care benefits for retired city employees a thing of the past. Under the new retiree health care plan City workers were offered 3 options - with varying degrees of contribution costs and coverages.
An overwhelming majority chose a 401(k) style option, which city workers don’t have to pay into, but also represents the biggest long term cash saver for the city.
It also helps cut the retiree health care deficit in half according to Sanders. The savings won’t be reflected in the 2013 budget. In fact, it could be many years before the budget actually sees the additional funds.
“It's going to free up money, probably out in the future maybe 10 years out or so it'll start freeing up money” said Jay Goldstone, the city’s chief operating officer.
The police officers association is hoping the money will eventually go towards new hires, estimating the force is down 300 officers in the past two years.
“I think you'll see future councils starting to slowly restore police, certainly starting to restore park and rec hours, library hours, and really starting to look at those things along with the infrastructure which needs some additional money” said Sanders.
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