ATLANTA — The Atlanta City Council on Wednesday unanimously voted to overhaul the city’s retirement plan.
The changes avoid the need for personnel reductions and service cuts, and puts the city on a more stable financial path for this year and the future, city officials contend.
The plan creates $22 million in savings the first year and allows the city to pay off a $1.5 billion unfunded pension liability. The measure saves the city more than $270 million over the next 10 years, and more than $500 million over 30 years, officials said.
“One year ago, the City of Atlanta’s pension plan could fairly be compared to a sub-prime loan in which the city was investing $110 million per year without one penny of that amount going to pay down its $1.5 billion unfunded pension liability,” Mayor Kasim Reed said in a statement. “Today, because of the courage of the Atlanta City Council and the women and men who work for the City of Atlanta, we have faced this problem head-on, and through shared responsibility, we have taken a critical groundbreaking step toward resolving it.”