| Milford officials look at pension change | ||||||||
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| MILFORD — The city is considering a change to the pension system that would save $2 million and help lower the substantial tax increase residents are facing. |
| Insurance actuary Daniel Arnold, of the West Hartford based firm of Hooker & Holcombe Inc., unveiled the proposal Thursday. Arnold said the city's pension fund has a surplus of $79 million. The city's pension fund is $271 million as of March 31. Currently, the city is scheduled to make a $2.6 million payment from next year's general fund to cover police and fire retirees' cost of living increase. Arnold said because of the pensions board's "phenomenal management" of its fund the city could take the $2.6 million out of the pension fund's surplus. Arnold said the city would only have to contribute $600,000 next year to maintain the fund. He said police and fire account for $52.7 million of the total surplus. Arnold said by merging the police and fire supplemental fund into the pension fund the city would be taking on $47 million worth of unfunded liability. Mayor James Richetelli Jr. said the $47 million figure represents money the city would owe all fire and police union members if they were to all retire at the same time. Arnold said the city is responsible for the $47 million regardless of whether it merges the supplemental fund into the pension fund. Because the police and fire portions of the surplus is $52.7 million he said it can absorb the $47 million. "We have one of the most successful pension funds in the city, which is why this is even possible," Richetelli said. "We could be saving taxpayers $2 million a year." The Board of Finance last month approved a $136.5 million city budget for 2002-03, which would result in a tax rate of 29.14 mills, an increase from the current fiscal year. The 2001-02 city budget is $127.5 million. The tax rate is 26.86 mills. A mill equals $1 for every $1,000 assessed property value. The city for the past several years has not made contributions to the pension fund because it's been so over-funded, but the city does have to make contributions to the police and fire supplemental fund, Arnold said. At the pension board meeting, there was uncertainly whether the police and fire unions would have to approve the proposal. Police union President Jeff Matchett and fire union President Michael Ryan attended the meeting. Ryan expressed concern that under the proposal the police and fire's pension surplus would be eradicated and wondered if the city would make a financial investment to restore the surplus. He also expressed concern that the city may try and make union employees increase their contribution to the pension fund. "The union's position is we feel it's a mandatory subject of bargaining and that we're willing to sit down and discuss the impacts," Matchett said. Richetelli said in order to show the city's good faith he's proposing the city contribute $2 million to their supplemental fund for 2002-03, instead of the $600,000 recommended by the actuary. However, he said it would still save taxpayers $600,000 for the upcoming fiscal year. The mayor said he'll meet with Matchett and Ryan next week to discuss the plan further. Brian McCready can be reached at bmccready@nhregister.com, or 876-6800. |
| İNew Haven Register 2002 |