Police, Fire pension concerns linger

Both city staff and Police and Fire employees agree on one thing: The plan is woefully underfunded.

The fund has 52 percent of money needed to cover all of its current liabilities, according to Assistant City Manager Evelyn Honea. Honea, who also serves as chair of the plan’s pension board, said a healthy plan would have between 70 percent and 80 percent funding.

The disagreement between the two sides comes in how to fix that lack of funding.

The city says there are three areas that need to be addressed: city contribution levels to the fund, the return the fund receives on its investments, and benefits.

Honea told council that the city is addressing all three elements; the board is currently implementing changes to its investments to improve return, and increased contributions will be discussed during upcoming budget meetings.

The proposed changes, which would be effective only for those hired to the Police and Fire departments on or after June 1, include a minimum retirement age of 55 with 25 years of service and a 2.5 multiplier for pension payouts, compared to a 2.8 multiplier for current employers.

New employees also would contribute 8.5 percent of their pay to the plan – a smaller portion than the 11.35 percent paid by current employees – but that money would not be refunded on retirement.

Eight people spoke against the recommendations.

“This ordinance is not set up to fix the problem,” Shawn Martin, a member of the International Association of Fire Fighters Local 152, told the council. “You have been given a Band-Aid to fix what is effectively a gunshot wound.”

Other speakers said the changes would make it difficult to recruit and retain new Police and Fire employees.

Council can vote on the proposal at its May 15 meeting.

See SBJ’s May 8 issue for more on the pension discussion and other City Council matters.[[In-content Ad]]