Pennsylvania Pension Crisis: Communities Hit Hard

WILKES-BARRE — More pension funds in communities across the state find themselves in danger than ever before.

A state report finds 562 cities, boroughs, and townships with pension plans listed as distressed or taking in far less money than they are paying out.

The state auditor general on Wednesday listed Wilkes-Barre 10th in Pennsylvania in terms of the amount of pension money it will have to pay out, money it doesn’t have.

And city leaders say Wilkes-Barre’s pension plans are in better shape than many others.

Some people spend their working lives protecting us from fires, keeping us safe from criminals, or just working hard to make our communities more livable. And when their working days are up, they rely on pensions to pay for their retirement.

“Some of the retirees that we have don’t get real big pensions,” said Ben Victor.

Victor was a Wilkes-Barre police officer for 47 years. He worries that Wilkes-Barre’s municipal pensions have just been labelled distressed by the state auditor general and that in just a few years, pension benefits could be cut.

“Could that happen here? I wouldn’t rule it out.”

Pennsylvania Auditor General Eugene DePasquale released a list of the communities that have the most pension debt.

Scranton was fourth, Wilkes-Barre was 10th, Hazleton 11th, and Williamsport 20th.

DePasquale worries about municipalities with pension funds listed as severely distressed, meaning they could run out of money in just a few years.

In our area that list includes Scranton and Roaring Brook Township in Lackawanna County, New Milford Township, Forest Lake Township, and Susquehanna Depot in Susquehanna County, and Lamar Township in Clinton County.

“Without a fix to this, we’re going to have significant cuts to public safety, or municipalities are going to have to look at having tax increases that are, in my view, unsustainable to our seniors and to our property taxpayers,” DePasquale said.

“People are really taxed to the hilt,” Victor added.

Victor says it would be unfair to retirees if pension payouts were cut.

“It’s like a contract. You’re getting it and all of a sudden, they’re going to take it off you.”

Some of the main reasons so many pension funds are in trouble are high payouts agreed to in the past, coupled with stock market losses in 2007 and 2008.

Wilkes-Barre Mayor Tom Leighton says his city’s pensions are well managed and in good shape compared to similar sized communities in the state.

He doesn’t anticipate any cuts anytime soon.