Lynchburg: facing a loss of $15-16 million in state revenue? A suggestion.
December 2, 2009
News and Advance
PO Box 10129
Lynchburg, VA 24506
Letter to the Editor;
“Working for efficiency in government” was the official editorial in the News and Advance on December 1. Noted were examples of possible cost savings in Lynchburg City government.
What other costs can be reduced?
For example in 2009 Lynchburg paid 20 percent of the City’s employee payroll into the public employee Virginia Retirement System (VRS). That is millions of tax-dollars paid year after year. For the budget year ended June 30, 2008 --- $17.7 million in VRS pensions were paid out to retired city and school board employees (per the City’s Comprehensive Annual Report on page 44 as completed by Lynchburg’s Financial Services)
What is the cause of the high 20 percent contribution rate? Is the total amount the City pays into VRS driven up by the high number of employees taking early disability retirement? The answer I received from a City official during a recent meeting in City Council Chambers is that this is in fact the root cause of the City’s high VRS cost. During that meeting it was also noted that another large local government employer in the greater Lynchburg area pays less than 10 percent of its payroll cost to participate in VRS. As such, it appears possible for the city in the long-run to significantly lower this high cost.
State legislators acted in 1998 to insulate State government from skyrocketing costs of employee disability retirements. Legislators created the Virginia Sickness and Disability Program which keeps state employees from receiving permanent early disability retirement pensions through VRS. Why haven’t the local governments who belong to VRS been allowed to participate in the state’s sickness and disability insurance coverage?
See link (click here). “The VSDP focuses on helping you make a safe return to your full duties following your disability. Return-to-work plans, such as job modifications or vocational/medical rehabilitation, may be developed in consultation with your employer and treating healthcare or medical professional to assist in your recovery and return to your regular schedule.”
To elected leaders – its time to cut costs by allowing local governments to join the state’s Virginia Sickness and Disability Program.
