Fewer Ore. Firefighters on Disability Under New System

April 11--The percentage of Portland police and firefighters off work on disability has dropped 44 percent since 2006, the year voters approved reforms to the city's unique public safety fund.

Linda Jefferson, director of Portland's Fire and Police Disability and Retirement Fund, presented the data in a report to City Council this morning.

In 2011, 5.3 percent of the city's police and firefighter workforce was off duty, collecting disability benefits; compared to 9.5 percent in 2006.

Put another way, in 2006, the fund denied 3 percent of disability claims, approved 95 percent and the remaining 1 percent were withdrawn. In 2011, 9 percent of disability claims were denied; 87 percent were approved and the rest were withdrawn.

Further, an average of four fund members a year -- representing just over 1 percent of approved disability claims -- are transferred from short-term to long-term disability, meaning they're out of work for more than a year.

The other 99 percent who have disability claims approved are returning to work within a year, some to limited duty jobs.

"Very few members are staying on disability more than a year now," said Nancy Hartline, the fund's financial manager.

Jefferson also told the council that medical expenses are being contained due to the use of managed health care service providers.

On the pension side, new officers and firefighters hired after Jan. 1, 2007, are placed in the state's Public Employee Retirement System -- a pre-funded system unlike the city's pay-as-you-go, taxpayer-funded public safety fund.

While pension expenses are increasing now, as the PERS contributions are funded by the fund's tax levy, the fund's pension costs in the long term are expected to decrease.

PERS contributions were $2.9 million in fiscal year 2010-2011, and are the fastest growing part of the fund's budget.

Those expenses are projected to increase 178 percent over the next five years, to about $14 million by 2017, Hartline said.

"Higher expenses mean a higher tax levy until the pay-as-you-go FPDR pension expense begins to decline," the report said.

Currently, the tax levy for the fund is at $1.41 per $1,000 of real market value. It's projected to rise to $1.93 per $1,000 of real market value.

A fund analysis suggests there's a 10 percent risk the fund's levy will reach its cap of $2.80 per $1000 of real market value in 2029, Hartline said.

"Things are working the way they've been designed," said Bob Lemon, a Portland firefighter who is a trustee on the fund's board.

Commissioner Dan Saltzman, who helped champion many of the voter-approved reforms, praised the work of the fund's director and staff, and the stakeholder's committee that worked for months to recommend the changes.

Commissioner Randy Leonard, a retired Portland firefighter, complimented the police and firefighters who supported the reforms.

"Thank you to everyone involved," Mayor Sam Adams said, as the council adopted the "State of FPDR" report. "Forty-four percent reduction in police and fire disability cases -- who would've imagined?"

-- Maxine Bernstein

Copyright 2012 - The Oregonian, Portland, Ore.