NEW ORLEANS (AP) - The city of New Orleans must pay $17.5 million for its share of the fire department’s retirement fund for 2010 through 2012, The Louisiana Supreme Court has ruled.
The 4-2 ruling Friday upheld decisions last year by Civil District Judge Robin Giarrusso and a state appeal court.
The reasons were not available Friday or on the Supreme Court website Sunday.
“It’s over,” firefighters’ attorney Louis Robein told The New Orleans Advocate (https://bit.ly/1dDxOaU ). It might be possible to appeal to the U.S. Supreme Court, he said, “but you’d have to be pretty creative to come up with a true federal basis for a local dispute.”
Arguing that firefighters had long received overly generous longevity raises and retirement benefits, the Landrieu administration stopped making full monthly payments to the fund in July 2010, Nola.com The Times-Picayune reported (https://bit.ly/1dbo38W ). By the end of 2011, that debt rose to $12.5 million and reached $17.5 million in December 2012.
The money is not in the 2014 city budget passed last fall. Landrieu has said he would consider simply refusing to pay, arguing that state courts can’t seize city assets. The Orleans Parish School Board, for instance, has millions of dollars in unpaid judgments against it.
City officials contends that poor investments by the Firefighters Pension Board have driven up the amount the city must pay to keep the New Orleans Firefighters Pension and Relief Fund in good standing
“In these tough times, it is particularly offensive that the city’s taxpayers are on the hook for this extraordinary sum, largely because of the Firefighter Pension Board’s reckless investments,” Landrieu’s chief deputy, Andy Kopplin, said in a statement. “This ruling, combined with the impending costs related to the sheriff’s consent decree, will be devastating to the city’s budget and could potentially lead to cutting critical city services and employee furloughs.”
Pension fund investments have included $15 million put into a hedge fund that went bankrupt.
Aside from claiming that the city simply could not afford it, Landrieu’s administration argued that ambiguities in the law should give the mayor discretion over how much to contribute.
Nick Felton, head of the local firefighters union, said, “We’re trying to set up a meeting now to see if we can’t come to some kind of reasonable understanding. But we cannot turn $17.5 million into zero, which is what they wanted.”
Please read our comment policy before commenting.