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Allentown council hears presentation on proposed DROP pension for police to address looming retirements
Summary
At a June 10 special meeting, Allentown City Council received an informational presentation on Bill 46, which would add a limited Deferred Retirement Option Program (DROP) for police. Administration and police leaders said the program is intended to retain experienced officers; finance staff gave a range of potential annual municipal cost increases and council requested more data before any vote.
Allentown City Council held a June 10 informational session on Bill 46, a proposal to add a limited DROP (deferred retirement option plan) for the Allentown Police Department intended to retain officers who become eligible for retirement.
Managing director Frank Kane introduced the item and the chief of police explained the mechanics: once an officer reaches the service threshold (commonly 20 years, with military buyback options), the officer may enter DROP for up to 60 months. During that period the officer continues to work and the city places pension payments into an account that compounds; when the officer separates service they receive a lump-sum payment plus their pension. “This is not about a money grab. This is about making sense with public safety,” the chief said, framing the proposal as an operational retention and recruitment tool.
Sergeant Chris Matthews, president of the local FOP, told council the union membership supports the benefit and stood ready to answer questions about implementation. Finance director representatives cautioned the fiscal impact depends on enrollment behavior. The finance presenter said the city’s current minimum municipal obligation (MMO) for the affected pension is roughly $9.5 million. Under a baseline scenario the actuaries estimate the MMO could rise to about $10.6 million; in a heavy-enrollment scenario it could rise to about $12.3 million. The administration also provided an illustrative range for net additional cost after offsets of roughly $500,000 to $2.5 million per year, depending on how overtime and staffing changes balance out.
Council members pressed for detail. Members asked where the money would come from, whether the program would create an enduring liability, and whether similar benefits would prompt parity requests from other unions such as the fire department. The chief and union representatives said DROP is intended to limit mass retirements that could force mandatory overtime and reduce capacity; they also argued seasoned officers in DROP could mentor newer officers. The chief said the department currently has about 205 sworn officers and identified roughly 40 who could be eligible to retire in the near term.
No vote was held. Council characterized the session as informational; members asked the administration to produce municipality-by-municipality case studies, historical recruitment and attrition data, and a fuller actuarial breakdown of MMO assumptions before the item returns for action. The administration agreed to provide a redline of assumptions and additional data during budget planning and future meetings.
The council did not take formal action on Bill 46 at the June 10 special meeting.
