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What Is DROP?

DROP program was created to keep city workers on the job with institutional knowledge longer, while helping the city plan for retirements. DROP is an enhancement to your current pension plan. Under DROP (Deferred Retirement Option Plan), an employee sets a date up to four years in advance. At that point, your monthly pension benefit is then credited to a tax-deferred interest-bearing account.  When you officially retire within four years of your DROP enrollment date, you will begin to receive your monthly pension benefit, plus the accumulated balance in your DROP account.

Who Is Eligible to Participate?

Any employee who has attained at least 10 years of credited service* and attained the normal retirement age of their plan – Plan J – Age 55; Plan Y – Age 60.

What happened to the DROP?

In or about September 2011, The City passed Bill 110443 (Drop Ordinance) making changes to the plan. The bill would have changed the age you could enter drop and the interest rate.  DC 47 filed an unfair labor practice with the NLRB for Local’s 2187 and 810. Our members were harmed and we fought back.  During the negotiations, then Mayor Nutter separated Local 2186 from DC 47 negotiations, because they are a meet and discuss Local. They HAD to enter Drop under the new ordinance.  Our members were harmed and we fought back.  

Settlement Reached and What does it all mean for me?

President Fred Wright, Chief Negotiator for AFSCME DC 47; with the advice of Local 810 President  Jim Magee, Former Local 2186 President Alfreda Jones, and  Pension Representative Carol Stukes-Baylor was able to reach a settlement on October 31, 2016. Members of Local 2186 were made whole.  This settlement is the same as AFSCME District Council 33. Local 2187 President Bob Coyle was consulted.   

  • Within 30 days of signing the City will withdraw its appeal to the NLRB on the applicability of the DROP Ordinance to employees in 810 and 2187. WIN   
  • Effective upon adoption, revised Interest rates in the DROP Ordinance will apply to DC 47-represented employees, EXCEPT any employee who is enrolled in Drop or eligible to enroll in Drop on the date of adoption. (Anyone in DROP will get their pension re-calculated for 4.5%. Employees not vested or not DROP eligible upon adoption would receive 0.65% or the Treasury rate at the time going into DROP.)

NOTE:  It will not be retroactive – meaning that if a person is DROP eligible but not in DROP, they cannot ask to be put in at an earlier date.

  • Effective upon adoption city employees that are members of Local 2186 will NO Longer be subject to a two year delay as imposed by the Drop Ordinance. However, no employee will be able to enter the Drop retroactively. (Meaning a 2186 employee can go into DROP at age 55 J-Plan  or 60 Y-Plan and not wait two addition years.)
  • Effective upon adoption, city employees that are members of Local 2186 who are currently enrolled in OR eligible to enroll in Drop on the date of implementation of this ordinance will have the interest rate calculation which existed before the Drop Ordinance applied to their Drop accounts. (Local 2186 Employees will be made whole, receiving the same benefit as Locals 2187 and 810. For a total of 4.5% interest compared to 0.65% before.)
  • This agreement is entered into as a settlement of the pending appeal of the PLRB Decision and is based solely on the facts and circumstances of the case.

Example of a Drop Benefit:

(Not to undermine the interest rate… BUT  If your service retirement benefit is $2,600.00 monthly and you remain in DROP for the maximum four-(4) year period, upon separating from city employment on average without any interest rate calculated you can receive about $124,800.

For further information concerning DROP, call 215-496-7430 to arrange an appointment with a pension counselor.