To the editor:
In the Aug. 22 issue of the Buckhead Reporter, the following quote appears: “Howard Shook, the chairman of the city’s Finance and Executive Committee, and Claire Muller, who is given credit for coming up with the idea, jointly submitted a resolution establishing a select council committee to come up with recommendations (to meet the $1.23 billion unfunded pension liability) by the end of the year. Shook has often said that ‘pension reform is the No. 1 priority.’ ”
Funding the $1.23 billion shortfall in the three city pensions (police, fire, general employees) requires a comprehensive program, particularly at a time when a former Atlanta chief financial officer, Janice Davis, writes that “the city will fall short of funding its present operations at least during the next two fiscal years.”
Any comprehensive plan to fund the $1.23 billion pension shortfall should include the following:
• An independent audit of the city’s three pension funds.
• The appointment by the trustees of each pension fund of a highly reputable and successful investment adviser.
• According to the Turnaround Plan (pages 52 and 53), “Another approach used by some cities to improve both efficiency and effectiveness has been marketization.” Savings from marketization vary but can be significant, such as 60 percent for residential waste collection, 38 percent for fleet management, 40 percent for airport management and operations, 50 percent for fire services, and 50 percent for road maintenance.
The Turnaround Plan recommends “revising the performance evaluation system of city employees.” A revised evaluation system might contain specific and measurable productivity and quality metrics for all job functions. An independent, third-party management consultant should conduct these evaluations. While Atlanta has approximately 9,000 employees, other comparable-size cities have far fewer.
The Turnaround Plan recommends “implementing incremental revenue initiatives to significantly improve the city’s financial condition.” An example of such a revenue initiative is through a commuter tax applied to those living outside the city and using city services. A growing number of cities have implemented such a commuter tax.
The Turnaround Plan recommends leasing or selling off city assets. According to federal law, Hartsfield-Jackson could be leased or sold with the approval of the Federal Aviation Administration and Delta. Six years ago, the Australian airport-management firm Macquarium offered $2 billion for a 25-year lease, subject to a feasibility study and the approval of the FAA and Delta. The city also owns 10,000 acres in North Georgia, purchased for a second airport. Finally, the city could condemn and sell off vacant lots, abandoned houses, houses with unpaid water bills, etc., for extra revenue that could be dedicated to help the pension funds.
Let’s hope the Select Council Committee on Pensions will exert the leadership needed to meet the $1.23 billion shortfall.
John S. Sherman, president
Fulton County Taxpayers Foundation