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MBTA: I wonder if they're hiring?

Discussion in 'Political Discussion' started by Real World, Aug 21, 2007.

  1. Real World

    Real World Moderator Staff Member

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    What a state we live in. Hey, can we get the government to run more programs, agencies, and services? Please? I think I'm in the wrong profession. My best friend & also my closest cousin, both work at the MBTA. Talk about a joke.


    MBTA's retirement plan pays off for two

    Ex-officials get pension, work government jobs

    By Andrea Estes, Globe Staff | August 21, 2007

    Two former top officials at the MBTA are taking advantage of the generous terms of the agency's retirement plan, which allow employees to begin receiving a full pension at an early age, while simultaneously collecting six-figure salaries in other government jobs.

    Former MBTA general manager Michael Mulhern, 48, who became executive director of the MBTA Employees Retirement Fund after retiring, takes home more than $350,000 a year: a salary of about $225,000 and a pension of about $130,000.

    James Rooney, 49, a former deputy manager at the MBTA, now makes $255,000 as executive director of the Massachusetts Convention Center Authority, while drawing an MBTA pension of more than $70,000.

    If they were employees covered by the state pension plan, they would have qualified for much less. To get a full pension, most state employees must wait until they are 65, but MBTA workers can receive a full pension after 23 years of service, regardless of age.

    If they had retired from the state, Mulhern would have qualified for a $35,000 pension and Rooney just $3,000, and they would have faced strict limits on how much they could earn in a government job.

    As the MBTA struggles to pay its bills and has been forced to raise fares three times in six years, some specialists say the pension plan is a fringe benefit the state can no longer afford. The T receives one-fifth of every sales tax dollar paid in Massachusetts.

    "These benefits are utterly astounding," said Michael J. Widmer, president of the Massachusetts Taxpayer Foundation. "I've never heard of anything like this. The combination of benefits may well be the richest in America. There is absolutely no way that the T can maintain this kind of benefit structure and not eventually fall into effective bankruptcy."

    .............

    The T plan is generous in other ways. Employees must contribute 4 percent of their salary to the retirement fund, according to MBTA spokesman Joe Pesaturo, while most state workers must pay 9 percent on the first $30,000 of their salary and 11 percent on the remainder.

    There are also no restrictions on the amount of money MBTA retirees can earn if they return to work in the public sector. State workers are severely limited: They can earn no more, salary and pension combined, than the current salary of the job they retired from. Regardless of their new salary, they are allowed to work only 960 hours a year.

    MBTA retirees also receive free health insurance for life, regardless of when they retire, while state retirees continue to contribute toward the cost of their medical insurance, either 15 or 20 percent, depending on when they retired.


    http://www.boston.com/news/local/ma...08/21/mbtas_retirement_plan_pays_off_for_two/

    <-------------------------------------------------------------------->

    **Now here's the best part, the T is $8 Billion in debt. Yes, I said $8 Billion. So who do you think is going to pick up the tab when it's on the verge of going bankrupt? Yup, that'd be you and me! :enranged:

    At the heart of the MBTA’s huge—and growing—problem is its massive $8 billion debt burden. The authority devotes 27 percent, or $363 million, of their annual budget to debt service payments, which represent the authority’s largest single expense. If this debt debacle goes unaddressed, over 30% of its expenses will go to debt service by 2010.

    http://barriosblog.typepad.com/barriosblog/2007/04/mbta_debt_out_o.html
     
  2. Pujo

    Pujo Experienced Starter w/First Big Contract

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    I honestly have no problem, on principle, with someone working while collecting retirement. They've paid into the fund and earned their retirement money, whether they're able to work a second job doesn't affect the taxpayer in the slightest.
     
  3. maverick4

    maverick4 Banned

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    ridiculous.
     
  4. sdaniels7114

    sdaniels7114 Experienced Starter w/First Big Contract

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    The worst of it is you know those two went home ten pounds heavier (in nickels, dimes and quarters) every day they worked at the T.
     
  5. Real World

    Real World Moderator Staff Member

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    Excuse me? How does it not? Do you know how the pension fund works in the MBTA? They match investment which is a direct cost to the agency. They also take the highest 3 years of earned income, divide it by 3 9getting the average obviously), and then paying out 80% of that figure for the rest of your life. Sorry, but that is a cost to the employer/agency which in this case falls to the consumers and the taxpayers.
     
  6. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    Whoever negotiated the contract for the city obviously didn't do a good job. Happens all the time. Some jobs pay disproportionately well. It's not fair, but that's the nature of the free market. The same sort of inequities occur in private industry as well. What's the solution?
     
  7. Pujo

    Pujo Experienced Starter w/First Big Contract

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    So let's reform pensions.

    But if we've said that someone becomes entitled to some benefit at a pre-determined time, the fact that they continue working elsewhere doesn't affect that. Whether he's staying home or working another job, he's still going to be costing taxpayers the same amount.
     
  8. Real World

    Real World Moderator Staff Member

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    Free market? WTH are you talking about? The MBTA is union dominated and government run. There's nothing free about that. Matter of fact it's restricted from sub-contracting. What a surprise, a govt. run agency that overpays it's employees and is $8 Billion in debt. Oh, and you don't have a problem with it. Another surprise I guess. :rolleyes:
     
  9. BelichickFan

    BelichickFan B.O. = Fugazi PatsFans.com Supporter

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    #24 Jersey

    This is the kind of crap that makes me against pensions. When I retire I will get something like 30% of my final 3 years - that's more appropriate. Quite honestly, though, if they'd raise the limit on Roth IRAs and eliminate the pension completely I'd be good with that. Whether it's the burden on the taxpayer or on a company, overweight pensions can just become unsustainable especially with life expectancy rising over the decades.
     
  10. Pujo

    Pujo Experienced Starter w/First Big Contract

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    I agree that pensions are outdated and personal retirement plans are the way to go.

    But, as long as someone IS vested in their plan, and the amount they're earning is already set in stone, the fact that they work another job at the same time doesn't change anything.

    I know it feels wrong that a public service employee is making that kind of money, but there's nothing terribly improper here.
     
    Last edited: Aug 21, 2007
  11. scout

    scout Veteran Starter w/Big Long Term Deal

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    #15 Jersey

    This is totally bogus. My guess is someone got paid off somewhere along the line. Why should a taxpayer pay someones' outrageous pension. But wait there's more, the freakin' business they are running is losing money. Something really smells bad on this one.
     
  12. Pujo

    Pujo Experienced Starter w/First Big Contract

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    What are you talking about someone got "paid off"?

    What's he doing contrary to the law? Is it the amount he's getting from his pension that bothers you? Is it the fact that he's allowed to work a second job? Where's the issue, exactly?
     
  13. Real World

    Real World Moderator Staff Member

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    Math isn't your strong suit is it? It is a cost to taxpayers when these jokers start sucking off the pension plan. Sure they've "paid in", if you call 4% "paying in" in return for 80% of the average of your highest 3 years of salary. When you do the calculation of what that salary is, and what the pay in is at 23 measley years (and that's not counting the trade in of sick days), I can guarantee you that it's proportionally less than the pay in. Most pensions are factored on 30, or 35 years of service, not 23. Most require a higher rate of investment, with a shorter period of return.

    Reforming the benefits is the entire point isn't it? That the sweet heart deals these clowns get is wrong, and a fleecing of the tax payer.
     
  14. Real World

    Real World Moderator Staff Member

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    You're not really following the math here. If I tell you to give me a dollar a week, and that you can retire in 10 years, with full pay and benefits, that's great for you, but someone is going to have to foot the bill, because it won't have been you. At 4% pay in over 23 years, there is no way that the fund can pay you without going in the red. The whole point here is that this ridiculous plan is only possible because you and I will one day, if we're not already, be expected to pay the bill.
     
  15. BelichickFan

    BelichickFan B.O. = Fugazi PatsFans.com Supporter

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    #24 Jersey

    While I do agree with you, this is the kind of thing that I think should be changed, means tested if you like. Whether it's these guys or other cases like my parents getting social security while not knowing what to do with the 3% of their IRA they have to take out, the government just keeps pouring money out in an unsustainable manner. Social security, pensions, it should all be as needed to help people make it through their last years - not as a retirement plan. Instead they'll just raise taxes.
     
  16. Pujo

    Pujo Experienced Starter w/First Big Contract

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    I do fine with math, thanks. It helped me a lot in my selling mutual fund days. Your issue appears to be the retirement plan, not the fact that he's able to earn it while working two jobs. In that case we agree. I'd say just extend 401K accounts to government employees and let them save for retirement like everyone else.
     
    Last edited: Aug 21, 2007
  17. Real World

    Real World Moderator Staff Member

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    They're not just losing money, they are $8 billion in debt. 1/3 of their revenue goes to paying the interest on their debt. All the while my cousin sits under a tree at a subway station drinking coffee. He's an inspector for the MBTA. He does nothing. They have 11 people doing the job of two. Mind you, my cousin was an engineer on the Big Dig, and then one for Mass Highway. When I tell you that his jobs have all been a massive fleecing of our money, I'm being nice. Afterall, he's the one who tells me they've been.
     
  18. Real World

    Real World Moderator Staff Member

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    My issue is the plan, the governement, the agency, the pay scale, the benefits, the costs, and most importantly, my money. :enranged:
     
  19. Harry Boy

    Harry Boy Look Up, It's Amazing PatsFans.com Supporter

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    In maine a State Cop can retire (w/pension) and go to work on a town Police Force and probably get another pension.

    My own son just retired with a Captains Rank Pension from a Fire Dept, he applied for a job as Chief of a small town Fire Dept and it looks like he's going to get it, I asked him what he thought of this practice, he said "never look a gift horse in the mouth" if they are willing to give, than the receiver would be nuts to refuse, doesn't the cure for this lie with our government?
     
  20. scout

    scout Veteran Starter w/Big Long Term Deal

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    #15 Jersey

    If it quakes like a duck, smells like a duck...... come on. Who negotiated the pension for these guys. Look at all the back scratching, winking, behind the scenes wheeling and dealing that goes on in Boston, constantly. With that in mind, a company heavily in dept, gets its people whopper pensions has to be looked at with scepticism. Remember K-Mart went belly-up and the Sr officials were excused from there $$$$ loans. Sounds similar here, tho this is a public entity, so bankruptcy is probably not a problem.
     

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