Wednesday, October 22nd, 2014
Full Flop
McDonnell
On whether state employees should contribute to their pensions. 

Bob McDonnell on Friday, December 17th, 2010 in a Dec. 19, 2010 speech to legislators.

Gov. Bob McDonnell flip-flops on state employees pension contributions

On his way to the Executive Mansion, Bob McDonnell emphatically pledged not to reduce the state’s level of contribution to the retirement benefits of state employees.

Back In September 2009, then-Gov. Timothy M. Kaine proposed having employees contribute a portion of their salaries toward their pensions as part of an effort to close an anticipated $1.35 billion revenue shortfall in the state’s recession-wracked budget.

McDonnell didn’t like that idea, as documented on his campaign website.

"The tough fiscal climate...is no excuse for breaking a longstanding commitment to the men and women who have dedicated their careers to the service of Virginia’s people" the Republican gubernatorial candidate said.

In the release, McDonnell noted the state has paid its workers’ pension contributions since 1983 as a compromise for not offering workers a pay raise that year.

"The compromise represents a promise made by the Commonwealth to state workers," McDonnell said. "That promise cannot be broken."

As governor, McDonnell reinforced that commitment in April 2010.

"Current state and many local employees took their jobs with the expectation that their retirement contributions would come from their employer," McDonnell said. "We cannot turn our back on that agreement."

Ultimately, the General Assembly did require new employees hired after July 1 to pay the 5 percent toward their pensions, but not those working the state before that date.  

Fast forward to last week when McDonnell announced that he will ask the remaining 86,000 state employees to pay 5 percent of their salaries toward their pensions.

The governor’s proposal eases the pain by raising pay 3 percent for state employees hired before new retirement rules took effect, meaning the changes would leave them with 2 percent less in take-home pay.

McDonnell said the measure was essential to prop a retirement system underfunded by $17.6 billion. The pension plan, like many public retirement systems, has been hurt by the low investment performance and inadequate support from the state government.

A year ago, before McDonnell took office, VRS was underfunded by $11.9 billion.

Stacey Johnson, McDonnell’s press secretary, acknowledged the governor’s position on employee pension contributions has changed since his candidacy. "Since that time, everyone has learned additional, significant details regarding VRS and the need significant new investment in the immediate future," she said.

McDonnell last week told reporters, "The system is broken and badly in need of repair. I will not pass on a broken system to another governor."

That’s a noble goal, but a reversal nonetheless. Full Flop!