For some time now there has been discussion by the Firefighters’ Pension Board about the possibility of providing an additional benefit under the plan for retirees of the system primarily in the form of an annual cost-of-living adjustment. As I am sure you will recall a similar matter relating to adding a one-time supplemental benefit which resulted in a one-time 13th check for current retirees and members of the DROP for the Police Officers’ Retirement System was recently approved by Council on October 1, 2019.
There have been several proposals from the Firefighters’ Pension Board all of which required a payment in various amounts from the City in order to fund the request as the Vested Benefit Security Ratio of the plan is only 92.6%. The difference between the Firefighters’ Pension Board request and the one from the Police Pension Board is that at the time of the request, the Police Officers’ Retirement System was in an overfunded status and had a Vested Benefit Security ratio of 118.1%.
As a result of the deliberations and consideration of several options related to this matter, the recommendation is to ask the City Council to consider approving a 13th check for members of the system that have been retired for a period of ten years. The cost to the City to fund this benefit improvement is $6,187. Funds for this expenditure are available through the excess contributions the City has contributed to the Pension Plan, thus far.
It should also be noted that no form of an annual cost-of-living adjustment has been provided to the members in the past just as was the case with the Police Officers’ Retirement System request.
I think it is appropriate to provide a cost-of-living adjustment to these retirees of the system and request that City Council approve a one-time supplemental benefit payment under the plan for all members that have been receiving a benefit since October 1, 2009.