The City Council voted 15-0 to approve the plan, which some experts said could save the city from financial ruin. Minutes later, surrounded by council members and city employees, Reed signed the agreement.
“I think everybody’s breathing a little bit easier,” Reed told Channel 2’s Richard Elliot. “This is a good day because we’re going to stop the bleeding.”
The plan will reduce the pension’s costs to the city by 7 percent by shifting those costs onto city employees. That, said Reed, will generate $22 million to $30 million in savings over the next 10 years and $500 million over the next 30 years.
Reed also says the plan provides a way for the city to pay down, over 30 years, the massive $1.6 billion unfunded liability many financial experts said was hanging over Atlanta like the Sword of Damocles.
It was a plan agreed upon only after months of debate and political wrangling and after five different versions.
“We let go and ended up with a plan that saves more money than every other plan that was presented,” said Reed. “And that’s because we stopped arguing and started trying to solve a problem.”
City Council members lauded the spirit of cooperation that created the pension reform plan.
“Our work here is not about ourselves,” said City Council President Ceasar Mitchell as he quoted fellow council member C.T. Martin. “It’s not about our own personal ideas and ambitions. It’s about the future of our city, the health of our city and the respect we have not only for the process but for human beings.”
Many city employees admitted they didn’t love this plan but also endorsed it.
“It’s not a win for everybody, but it certainly is a equitable plan that can work fully for us,” said Atlanta Police Union President Ken Allen.
As as result of this plan, Reed said, the city will not have to lay off any more employees and will boost its reserves to $77 million.
“This is a new day, a new beginning,” said council member Felicia Moore. “We hope this collaboration continues to work.”
The plan goes into effect Nov. 1.