DN Editorial: DROP is not about the money

THE CITY COUNCIL members who want to reform the miserably unpopular Deferred Retirement Option Plan say they want to make it "cost neutral."

They would lower the interest rate that DROP accounts earn, raise the age at which workers can enroll, and deduct DROP payments from future pension pay-outs. They argue that reforming DROP rather than killing it would help the city avoid costly lawsuits.

To be fair to DROP - bet you haven't heard that line before - the program has been the subject of some unfair characterizations. A report last summer over-estimated its cost, claiming it cost $22.3 million annually when the real number is $10 million. (Which means, coincidentally, that we've spent $100 million in the past 10 years on DROP . . . just the amount the city is trying to raise to help the school district.)

And the faces of the program - bigwigs like Councilwoman Marian Tasco, who will collect nearly $478,057 from this retirement program without actually retiring - aren't representative. The typical worker's use of DROP is much less abusive.

So maybe Council is right. Maybe DROP could be made cost-neutral, in terms of dollars and cents.

But here's the problem: DROP is no longer about the money. (In fact, DROP was always just a tiny raindrop in a tidal wave of pension problems headed for the city.) DROP is now about confidence in government.

Philadelphia just had an election. Voters made fairly clear what they think of the DROP program: After five members of Council decided not to seek re-election, quite possibly because of the stink of DROP, two DROP participants, both political powerhouses, actually did lose (Tasco prevailed).

Council's attempt to keep the program, not just for city workers but for several remaining eligible members of Council, will rightly be seen by voters as an attempt to thwart their will. And that will feed into the same cynicism that leads to low voter turnout, poor civic participation and a lesser civic dialogue.

(And that cynicism won't be helped by a recent report in the Philadelphia City Paper that the pension board has allowed more than 30 employees to "pre-register" in the current DROP program, even if their retirement dates are a decade away . . . effectively grandfathering themselves into an expensive program that may very well get eliminated.)

Nor does it make life any easier for actual government workers when citizens perceive the city as corrupt. Who wants to bother calling L&I about a collapsing vacant building when all you expect the workers to do is ask for a bribe?

DROP was supposed to be cost-neutral in the first place. Even if Council can get the math right this time - and that's a big if - there will be other costs to city government, and to the city, that it can no longer afford. *

Correction:

In two editorials referring to then-attorney General Tom Corbett's results in the Bonusgate scandal, we incorrectly stated the number of indictments of lawmakers. The Bonusgate scandal resulted in 26 indictments of current and former legislators as well as aides.