Cuomo budget director Bob Megna has been the star witness for the last few days before the joint legislative budget hearings, emerging as the administration’s main defender of the spending plan the governor introduced last week.

And on the controversial proposal to add a sixth pension tier to the public workforce retirement plan, Megna is no different. Among the points of contention is an option to allow new workers to move to a TIAA-CREF inspired plan similar to a 401(k) in the private sector.

Though the new tier does not achieve any significant savings in the coming 2012-13 budget year, Megna says the long-term goal is what’s needed. Cuomo tried and failed to get the tier in June, but it was a stand alone budget bill. The governor in New York has more power in the budgetary process, thus making the sixth pension tier more likely as Sen. Neil Breslin, D-Delmar, told me earlier.

Again, the plan only impacts new workers. But that hasn’t stopped public labor unions from opposing it, who say the proposal is something of a false option for younger workers.

“I think saving $83 billion over 30 years is an important thing,” Megna said. “It’s crippling the finances of state and local governments and we need to take a longer-term view.”

Comptroller Tom DiNapoli said yesterday that the state wasn’t in a position of crisis when it came to the pension fund. Megna said the real concern ought to be the burden carried by local governments. DiNapoli is highly critical of the defined-contribution proposal, a speech that’s taken on more weight after Cuomo made the Tier VI proposal.

“The pension fund is fully funded because employers are contributing rates of 16 to 20 percent,” he said. “That’s a crisis for state and local governments.”

Megna Workforce Testimony

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