So I saw some comments maybe a month or so ago on a police pension DROP and also some yesterday. I had to do some digging. What I heard is the mayor offered the police a DROP pension. So, for those that do not know what it is (including myself) or how it works, I will explain from what I gathered.
Basically say an employee retires on Jan 1 2026 with a pension of $50,000. The employee does not collect the $50,000 but instead the money is put into a retirement fund, like a 401k. The city does make some money off of this $50k and the employee is normally capped at a max percentage return say 3-5%. Anything above the 3-5% is the city's however the employee is guaranteed not to lose any money. The employee continues to work at the salary they left at say $75k.
DROP programs usually last around 2-5 years that someone can benefit from it, but that depends on what is negogiated. When the employee decides to retire a 2nd time, their $50k which has accumulated $50k a year plus interest has to be rolled into another account or that money can be taken out early with normally a 10% penalty. Example. $50k x 4 years in the drop = $200,000 adding say 3% interest, roughly another $50k (my math isnt 💯 fyi) , said employee after four years would have $250,000 in an account. Or said employee was basically making $62,500/year drop pension plus 75k salary or $137,500 a year for four years. Aka double dipping in my opinion.
The program is used to keep senior employees or experienced ones. Or in this instance is it for Chief Roca since the mayor has openingly said he wants his "yes man" to be chief as long as he is mayor. However, at what cost?
Lets 1st look at the raises coming up since Apd's contract is up at the end of the year.
The average officer after 3 years makes over $100,000. Those eligible for the DROP mostly have 20 years of service and have obtained some rank. So the $100,000 is for patrolman and with those with rank making significantly more. Starting officers make around $70k I believe. A 3% raise per year (which most police contracts are. Fire got 3% and SEIU im hearing got 5%) is roughly $3,000 per guy per year. $3000x200 officers on the force. Thats atleast $600,000-$800,000 a year for tax payers to cover. That doesnt account for the 3% thats added to all overtime. SEIU's raise probably cost the tax payers $450,000 a year and dont quote me on this, but I am told that each employee got 2 checks each for $1500 as part of their contract. Good for them tho, they deserved it.
Just a thought. Remember when the water plant had to be sold just to cover the city's obligations to the pension fund. Anything else left to sell if this goes through?
Back on track, the 4% property tax increase for 2026 generated about $1.5 million for the city. So basically the tax increase was gobbled up by the union raises.
I am figuring the Police DROP Pension will cost tax payers approx. $885,000-$1.2 million a year since the city loses state funding for the pension when officers enter the DROP program. This number could be more. But I highly doubt the finance department will tell council the cost.
*please note all my numbers are not 100% accurate, but they arent far off at all. Simply used to give everyone an idea so don't chew my head off.
So I understand needing or wanting to keep older senior officers for their experience, but the cost doesnt seem obtainable in a responsible sense for the city. Plus does anyone think according to my sources Chief Roca getting a $125,000 pension plus his $170,000 salary is right? That would essentially have him making close to $300,000 a year under the DROP. He could leave after 4 years in the DROP without counting interest at $500,000 in his DROP account. Is he worth that? Or can't he get another job and has no choice but to stay?
Don't forget the $50 million police station that is getting built which at this rate will cost over $70million. Or the Fire department and health department that is proposed at another i dont know 60-70 million.
Where the hell is this money coming from? Is the tooth fairy dropping Mayor Tuerk millions?
Without some serious budget cuts, the city is looking at atleast an 8% tax increase next year to cover a DROP and to pay for the new station. 8% is probably low, but expect tax increases of atleast 5-12% each year for the next 4 years. Will be interesting for the 1st year councilmen to have to vote on a huge tax increase just to save the city.
I just explained where alot of money will be going and I am letting out more expenses they need to cover. The city will be broke. But honestly I feel that at this point is the mayor’s goal.
Lastly, I am not sure how SEIU and AFD would fare if APD is given a DROP since they just signed new contracts, but I imagine they will want one as well. Atleast the greedy firefighters will.
Some of the recent pensions, which are close to 90% of their salary. Something is not right.
https://allentownpa.legistar.com/View.ashx?M=A&ID=1385249&GUID=8DD66DB9-3524-4568-8C15-E4CB0A0CD617
Here's also why the city is going broke.
Now compare all I said to your job. Ridiculous right? I work part time and am semi retired, but my career did not offer pensions this high. Drain the swamp.
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33 comments:
All great points, but you’re missing some of the biggest. The police department is in a contract year. Who the heck gives them this without getting something in return. They are literally going to come to the table asking for everything under the sun, AFTER the mayor already just gave them a DROP for nothing in return. Also, those pensions you posted are so high because their contract allows them to use their last 30 days of salary which includes holidays and a capped overtime to calculate their pension. Is the mayor allowing them to do this to enter the DROP?? If so, this is malfeasance on the finance directors part to allow this to go through.
Let’s not forget the mayor’s cabinet level positions, PW Director, Parks , HR, CEDD,Finance, All with extraordinary high salaries!!! Let’s look All of them get step increases PLUS what mayor feels they deserve, this past year was 3%plus step
Increase, plus all get SUV to drive home at city expense!! WTF 😳!!
The pensions and salaries at the City are mind blowing. What bothers me most is that residents of the West End pay enormous amounts of property tax and we physically see a police officer in our neighborhood once a year; the dozens of APD officers "working" at the St. Patrick's Day parade. There is literally no law enforcement at all in the West End. It would be so refreshing to see an APD officer in the West End proactively patrolling.
These pensions are disgusting. Now lets add a Drop pension in the mix. Someone mentioned what is the city getting in return for this gift? It appears nothing!!!!
Thank you for explaining this so well. I am a woman in my 70s on a fixed income. There certainly will have to be another tax increase to pay for all of this. There are 1000s of Allentonians who simply just cannot afford anymore tax increases.
Sometimes the biggest criminals are the cops
I am disgusted by the blatant mismanagement of taxpayer dollars at the direction of Mayor Tuerk, the finance director and the controller. I honestly don’t know what more to say about this administration anymore. Just when I think the administration sank to the lowest level possible they dig themselves lower.
The council should also be held accountable for allowing this to happen. I bet Napoli just let this go forward as a favor to mayor. I am sure he is looking for a business grant to prop up his suffering clothing stores on Hamilton.
The city government needs to change. These people only serve themselves and are taking our city future down the drain. With a moronic decision like this DROP, it seems we are in the express lane down that drain.
The city is getting the bill. The mayor is buying friendship from the police officers. The mayor knows the majority of police do not like him so he is gifting them a nice retirement option with our tax dollars with the hope he gains some friends.
He has really been on a spending spree with salaries and pensions lately. He is borrowing $150 million for two new buildings, gave the fire an amazing contract, promoted his secretary to a new job with a much higher pay, brought on a managing director so he can spend more time collecting frequent flyer miles, and now this drop?
What is next on his agenda?
I can guarantee one agenda item ——> raise taxes.
And the elected officials
The salaries are high and they are for people who are not qualified. Most of them are in their positions simply die to longevity at the city (Patel, Shahda, Kistler —also friends with Affa, Roca, Agosto). Not talent. The others are there because they are friends with the mayor (Tolino) or friends of council (Velezquez) and are returned a favor.
I wonder if the use of city vehicles for take home is reported to the IRS as required?
Ed Pawlowski sold the water works rather than deal with the rising costs associated with the disastrous police contract Afflerbach negotiated. It was so overly generous to the cops that talk was they had dope on the mayor and used it as leverage. I won't repeat what that allegation but I heard it from several cops who claimed it was legit. I suspect nothing so seedy this time, just the usual short term expediancy from a mayor seeking short term solutions rather than our long term interests
This MUST go before city council because it changes the pension ordinance. Hopefully people turn out to speak against this and city council does the right thing and votes it down and proves they aren’t just yes men to the mayor.
I believe you are correct. If it is true this could cost 1 million a year or more for the tax payers, then it needs to be voted down. The other unions will obviously want it too then.
Raise taxes? Oh they will cook up something even more sinister like the stormwater fee that isn't a tax, it's a fee. Perhaps a "public safety" fee or an "infrastructure fee" that will be sold with the question like "how can anyone be against public safety or infrastructure improvements". The fee racket is a looters way of expanding the tax base to otherwise tax exempt entities. After all, EVERYONE must pay their "fair share".
did you know that in order to prevent a city from flooding that there must be infrastructure to wick away the stormwater? did you know that there is a direct correlation to the amount of impermeable surfaces an entity has to the amount of infrastructure it needs? modern marvels!
We really can’t pretend to be surprised by the decisions coming out of the Tuerk administration. We elected him and this council, and we expected them to handle tax dollars responsibly. Instead, it increasingly feels as though the general fund is being treated like a personal spending account rather than public money.
I watch council meetings regularly, both in person and online, and the lack of community representation is obvious. Showing up has become almost pointless. New rules have been put in place that restrict public comment—rules that may conflict with government conduct. The mayor and council routinely decline to answer questions.
If we want accountability—and want to prevent these elected officials from making decisions like this with taxpayer money—the only real tools we have are our voices and our votes. Speaking up matters. Voting matters even more. That’s how you send a message and change the direction of Allentown.
I appreciate your examples Abe, but something isn't adding up. I don't understand how the drop could possibly cost the taxpayers. To me, I thought the drop was more of a guarantee from the officers that enter the drop to stay on for a period of time. In exchange their pension contributions are moved to a drop account for them to use later as they see fit. It doesn't make sense that it should cost the city. 1. The pension fund will pay their normal pension when they retire. 2. The employee has any future pension contributions send to a drop fund. 3. The city has a secured retirement eligible employee which helps the administration with planning. 4. these are funds that would normally be expended anyway. The only people that lose in this situation are the lower officers that are looking to get promoted and advance. They are stuck until the drop retirement eligible senior officers finally officially retire.
what am I missing?
Great talking points from a “follow the science” sleight of hand argument. Stormwater runoff is dependent upon rainfall not all of which goes into the storm sewer. You are asking people with impermeable surfaces to fund the runoff from the paved roads. Also, impermeable surface is a broadly defined term that can be increased on a whim. There are some who believe that mulch beds lined with weed barrier plastic count as impermeable. The list is endless. Also, the need for the “fee” arises from the very misplaced spending priorities that we see currently. Instead of conjuring up new fees, practice fiscal responsibility instead of spending money like a pimp with a week to live.
It was proposed within the last year to “borrow” from the stormwater fund to close budget holes. That doesn’t sound like a modern marvel approach to preventing flooding. That sounds like perpetuation of the spending problems.
Anyone who expected Matt and/or council to handle our tax dollars responsibility hasn't been paying attention.
This is an excerpt from an audit report that investigated the costs associated with the Philadelphia DROP.
Philadelphia's DROP program cost the city an estimated $237 million to $277 million over 16 years, with thousands of employees receiving large, lump-sum bonuses.
Because DROP allows employees to freeze their pension benefits and store them in an interest-bearing account while continuing to work, it exacerbates the strain on already distressed municipal pension systems. DROP plans often fail to retain workers for as long as intended, and if the promised interest rate on the lump-sum account exceeds the actual pension fund investment returns, the city loses money.
The financial pressure from these payouts can force cities to make cuts in other areas of the budget, such as services and infrastructure, as funds are diverted to cover pension liabilities.
Because deferred compensation is not guaranteed, it is treated as an unsecured liability on the city's books. This is turn most likely effects their borrowing and bond rating powers.
To me there are a lot of risks with this that Allentown cannot afford to take on. The city administration has been making poor financial decisions and this is just another that the taxpayers will be forced to carry for many years.
https://www.phillymag.com/news/2018/09/15/drop-plans-deferred-retirement-option-philadelphia/
Double dipping. They receive their retirement to bank and their current salary at the same time. This isn't receive science. It'll cost fortunes. Read Abe's post again. This an absolute disaster waiting to happen. Just wait and see. You probably don't pay taxes in Allentown so it won't matter to you.
I don't see the big deal...and I have been paying taxes in Allentown for over 20 years.
The city retains a qualified employee and saves recruitment and training costs while the retiree stays with the APD for a determined period (predictability and continuity), stops contributing to the pension (they cannot increase their years of service or pension amount).
In exchange the drop eligible retiree will receive their normal retirement pension payments, but they are sent to an interest-bearing account. They continue to receive the salary that city would have paid to a replacement anyway, or close to it.
The drop seems to be a win for the city and for the retiree.
Now if the concern is retaining poor performers, that is a separate issue. The chief and Administration are responsible for not addressing the poor performance.
The reality is that the city taxpayers deserve to have the Finance Director explain the drop and ALL associated costs and benefits. We shouldn't be relying on a blog to explain this decision. The administration needs to be transparent.
The issue is, as is stated, a DROP keeps alot of slugs. Doesnt replace them with new fresh officers at a way cheaper cost. I can see people just burning their accrued time and never even showing up for work. Unfortunately, this blog offers more info than the damn city. It may not always be 100% but it atleast exposes alot of truth and corruption and things we may not ever know are going on.
Without realizing it, you just pointed out what everyone is missing…..there aren’t any “fresh new officers” waiting to be hired. That’s the whole reason for the DROP. The supply for police no longer meets the demand. The city couldn’t hire enough to replace everyone if they wanted to. They’re trying to keep the ones they have, because that’s more realistic than trying to replace them with new people who don’t exist. Give it 5-8 years and watch the staffing crisis. Write it down.
So it is the taxpayers fault that the city, HR and APD administration can’t hire and retain good officers? The taxpayers should just keep paying for poor performing desk sergeants and chiefs that sit around fat dumb and happy who maintain seniority and maximum vacation time?. Seems to be more of an Allentown problem and not a police problem.
Who would want to serve in a municipality with poor leadership that is plagued by multiple lawsuits run by a leftist lunatic mayor who pushes back against authority?
I’m sick of hearing this constant excuse that they need more officers. They completely contradict themselves. Roca and the Mayor constantly tout how much crime is down…which it seems to be. Look at the homicide numbers alone. So why do we need any more officers than we currently have??? Yes, keeping senior officers making 6 figures is a lot more expensive than brand new officers making the minimum. Also, APD is having no issue with hiring…they are constantly hiring officers and from what I hear, always has a list to hire from which most departments don’t.
I’ve been hearing “staffing crisis” for the Allentown Police for the last 35 years. It’s a union tactic to try to scare the admin into giving them what they want, such as this DROP. I am sure that they are telling anyone that will listen that the “sky is falling” unless they get this DROP and whatever else they’re asking for in the contract. They’ve cried wolf too many times though with this same “staffing issue” and the city has always survived. Heck, much like the above poster stated, crime is down. It’s pretty obvious some cops who want the DROP badly have started commenting here. It will be alright, Allentown Police will do just fine without your $125,000 a year salary.
Dallas and Philadelphia are great examples of why the DROP is a bad idea. Both cities have determined that they are financially unstable. In fact the DROP nearly collapsed their pension funds. Philly is spending a lot of money to keep the DROP funded.
Allentown is already financially unstable, The police and fire pension funds are unstable and would result in severe financial risk that would impact those beloved services Tuerk loves to tout are delivered so flawlessly.
The taxpayers are already paying for the high-risk, low-reward decisions of this administration. We do not need another. I fear Council and Tuerk don’t get it and we will be handing the keys to the city back to the state because we were destructive tenants.
The incompetence spreads in both police and firefighters covering for crime committed that can be traced to the institution of allentown and lehighcounty.
I doubt that aside from his opinion, which we all have an opinion, honest Abe has no fiscal education or experience beyond that of most of us and the handful of posters.
I have no doubt council will request a review of the factors and will give them consideration.
Aa a retiree, in an understaffed field, I have continued to work since my area of competency is unfilled. I perceive that incentives are necessary to address staffing shortages. What Abe has never discussed is the competition that exists among other more lucrative and less stressful positions in the valley. The handful of critics championing Abe need to worry when police chose to work in surrounding areas. It is the same issue the school district faces.
Cops have been going to other departments for years. Nothing new. Why people join APD is because they do real policing and are real cops. Outskirt departments are like volunteer cops.You act like they dont have a 100plus applicants everytime they test... And APD are the highest paid with overtime and get the highest pensions. And only need to do 20years vs 25. Your point is dumb.
City council do what is right? That is funny. They do what keeps them in those seats and nothing else.
Matt is turning out to be another Roy A. and will end up bankrupting the City.
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