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City Council Passes Pension Reform Package

December 1, 2017

Councilmember-At-Large Stacy Head
NEW ORLEANS - Today, the New Orleans City Council approved changes to the New Orleans Municipal Employees Retirement System (NOMERS). The changes incorporate several recommendations of the pension board and apply only to employees hired on or after January 1, 2018.

The change is intended to maintain a reasonable benefit level for current and future retirees while costing the city less. In 2002, pension benefits were aggressively and retroactively increased and, since then, more of the general fund has been dedicated to keeping the NOMERS system solvent. Those changes, along with the 2008 recession led to a steady decline in the NOMERS funded ratio, which went from 109.7 percent funded in 2002 to just 68.2 percent funded at the end of 2016.

"I have worked for years for rational pension reform. The declining funded ratio is dangerous for the pension system and the city's financials. Today's reform will, over time, reverse the negative trend, make the fund healthier, and allow more taxpayer dollars to go to basic city services such as catch basin cleaning, minor street repairs, and public safety improvements," said Councilmember-at-Large Stacy Head.

Research by the Bureau of Governmental Research laid the foundation for the changes pushed by Councilmember Head.

"Throughout this effort, I have spoken with city employees and retirees, union leaders, business leaders, policy experts, financial analysts, and my colleagues on the council and in the administration. I appreciate them sharing their perspectives and experiences with me. I especially want to thank Christy Harowski at Forward New Orleans, Meg Lousteau at the Vieux Carre Property Owners and Residents Association, and Keith Twitchell at the Committee for a Better New Orleans for their support," said Councilmember Head.

The Council also approved an increase in pay for the lowest-paid city employees to be included in the 2018 budget.

"This is a move in the right direction," said Councilmember Head. "Pension reform cannot exist in a vacuum; the effort must be comprehensive. I hope the next council and administration will continue to find ways to support our excellent public employees. We need competitive salaries to attract and retain the best employees to public service. But we also need improvements in employee evaluations, employee management, professional development and career advancement opportunities."


Media Contact: 
Katie Baudouin
Policy Advisor/Special Projects
(504) 658-1060

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