Kansas City’s mayoral candidates on funding municipal employee pensions

Over the last few weeks, we’ve been speaking with Kansas City mayoral candidates about how they’d use the office to approach the biggest challenges facing Kansas City. (Pick up our March issue, out now, for a preview of the race.) 

As of the end of the 2018 fiscal year (last April), Kansas City, Missouri, is $733.3 million behind on its pension commitments to municipal employees. 

Mayor Sly James has appointed a task force to look into how the city can continue to fund employee pensions without further bankrupting the city, which is already sitting on nearly $2.7 billion of long-term debt. 

We asked each candidate what their plan would be to deal with escalating pension and benefits costs for city employees, and if they would be open to reforming how the city deals with pensions. Most of the candidates agreed on the importance of keeping the city’s pension promises to its employees. Some of them are waiting for the report from the mayor’s task force to decide how they would move forward, while others floated ideas like working to increase the city’s population to add to the tax base and making cuts to the pensions of the highest-paid city employees. 

Alissia Canady 

“We need to fully explore it. [Pensions are important] to municipal employees — that was a promise that we made. We need to be able to deliver on that and fund the pensions adequately. My understanding is that we’ve fully funded it at least these last five years, which is a good start. But we need to make sure that according to the best practices, we are aggressively investing in that area to make sure that we don’t have a negative impact on the city’s credit rating later.” 

Henry Klein

“A pension is this wonderful thing that really feels like it’s becoming a relic of the past, but I don’t want it to become that … I don’t want to obliterate pensions, especially when the compact that we have always had unspoken was: You work at city government, you don’t make as much money, but we take care of you in retirement … I’m way more interested in reforming pensions as it relates to the higher end of those pensions in terms of people who are drawing excessively large amounts of dollars of pension. I’m more interested in reforming that high end. Taking away from that person who is at the lower end of the income scale and now reducing their pensions more feels like a really mean-spirited, wrong thing to do … Do I want to make sure that we keep pensions solvent? Of course I do. Do I also want to make sure that we aren’t contributing so much to pensions that we can’t do all the other things that we need to do in terms of city government surplus? Of course. I see the higher end is the area that I want to focus on.”

Jermaine Reed

“It’s important that we protect our pensions, so let’s be very clear about that. The second part of it is that I do think that it is something that we have to tackle, and the next mayor and council is going to be responsible for protecting the pensions that are in place … I don’t think that this is something that should be too rushed or done in a vacuum. There are a number of important stakeholders. Our employees are our most valued assets. There are over 5,000 of them throughout this entire city. They are residents of this community, just like all of us. And it’s important that we are being fair and honest and being able to protect their pension.” 

Jolie Justus

“The way that they’re being currently done is not working right now. Right now, we have a task force that is made up of folks who are representing city workers and folks who are going to be future pension earners. I would also have a lot of great minds in the business and civic community taking a look at that. So what I would like to do is get their report back, take a look at all of the options that are in front of us, and then make the decisions we need to make sure that we are not underfunding our pension and that we are focusing on a long-term solution that won’t bankrupt the city.”

Phil Glynn

“I think that retirement security is a really important part of the agreement between workers and management. Retirement security is also important to our whole community because when people feel they have financial security, they buy goods and services and they spend money. Having a robust retirement security system in Kansas City is something that is good for everybody. Clearly, we have long-term fiscal challenges in Kansas City. I am more focused on trying to ensure that we are not overusing our tax incentive program, which erodes our tax base over the long-term. I’m more focused on ensuring that we spend the resources that we have today wisely. Those are the avenues I want to go on to address so long fiscal challenges.”

Quinton Lucas

“First of all, I do believe, unlike some others, that a pension is a contract … I think when we talk about reform, it’s about how do we make sure that as people are entering the program, there are different ways that we’re funding retirement. I think there’s another important point in those programs themselves: how do we make sure we are [funding] them sufficiently, and that the city’s making its annual contributions as it should be? I think there are more responsible measures we can take to try to deal with it. And frankly, how is it that we can ensure that we have enough tax base to address those issues? A big part of it is going to be having a population in Kansas City. I’d like to continue to see us increase population in the city without incentivizing it. Part of that is how do we see development in Kansas City in the long-term? … I hate commissions, appointing blue ribbon commissions, so let’s say I won’t. I’ll actually just try to find an expert or several, who will talk to others, instead of having an ex-city council member or state representative, or some other people who don’t know what the hell they’re talking about. Let’s actually find one of the best experts in the country to address the issue, have them visit with different groups in Kansas City and come up with a real solution.”

Scott Taylor

“One thing I would be careful on with pensions: with city employees, firefighters, police, it’s really a recruitment tool as well. Police and fire, and obviously first responders, are some of our most difficult jobs out there — and some of our city jobs are very dangerous also. And quite frankly, we — just like other municipalities — can’t pay enough for what the risk and danger that they put themselves out for. We just will never be able to pay them as much as they will get in the private sector … We have some [employees] that are retiring after 30, 35 years. We recognize them in each session. There’s always one or two people a week, it seems like, it’s amazing, the dedication we see. I don’t think most everyday citizens necessarily see it, because they’re at a desk or on the phone, but they really do go above and beyond what’s asked. And we want to keep people coming into the city to work … .And so the pension is a key part of it. Now, whether we can make changes, I think we can sit down. We need to do it in a collaborative manner and not a divisive manner. And that’s something I think my style is — my whole life has been getting people in a room. I transact and put people together and put things together to get results. So I think that’s kind of the same discussion. We need to have a pension. It should be an ongoing discussion out of respect and collaboration.”

Scott Wagner

“In about three years, at least two of those [the city’s] pension programs [there are four total] are going to be upside down. We are currently paying the appropriate contributions to keep them at the state-required levels that we have. That will begin to change in the next two or three years. There’s actually a discussion going on right now related to pension reform — the second one that has occurred over the past eight years. I’d like to see what they come up with, because the issues that we’re talking about are big ones as far as what we may have to do in order to shore them up in the longer term. Those are issues that, quite honestly, will involve collective bargaining agreements with all of our bargaining units. They’re going to be tough conversations, but the reality is that every city in this country is behind on their pension. I know of no city that is 100 percent fully funding its system. We are in a lot better position. We have fiscal challenges, frankly as a result of the obligations that we are paying right now. But I’m going to wait and see what we hear from the second pension task force and then go from there.” 

Steve Miller

“[Pensions are] a serious issue. And I bring that back to my experience with leadership: This is actually something that I had to address in leadership on the State Highway Commission. I had a plan that was in much worse shape than Kansas City. The City of Kansas City supports about 74-75 percent of funded pensions. When I came into MoDOT they were only at about 7 percent.  Now — it is complicated. You have to figure out how to pay into the promises of the people that gave to the organization based on these benefits and how we remain fiscally liable. I know from having already done this once, it is a hard, tough, process. It takes really smart people, actuaries, investment advisors, and this is going to be something that we are going to wrestle with. Mayor James has already appointed a committee to examine this issue, so I am eager to see what recommendations are made public. It’s like I said before, the mayor, along with the city manager, and the rest of the city council need to be concerned about being fiscally responsible. And part of that is figuring out how we manage our pension and benefit plans.”