by David Chapman
Staff Writer
A final decision by City Council on a study to find the true costs needed to fund employee pension plans must wait until next Tuesday, but the Finance Committee will have a chance to weigh in today.
If approved, the ordinance under review will again delay a study required by the City Charter to fund the plans “based on actuarial reports.”
The actuarial study would determine the City’s annual funding of the plans. If it’s found that calculations were higher for 2011-12 than those of 2009-10 — the last year the study was conducted — then the City could be on the hook for millions of additional dollars.
While the City Charter requires such a report annually, the state only requires one every three years.
The waiver was requested by the Jacksonville Retirement System Board of Trustees on the basis that such a study done now would not reflect stock market gains during the current fiscal year while also requiring an increase of the City’s pension contributions for fiscal year 2011-12.
But passing on finding out the true costs of the City’s contribution is “counter-intuitive,” according to a memo from the Council Auditor’s Office about concerns with a waiver.
The current calculations “most likely would be” higher than they were in 2009-10, according to the memo, and a waiver would defer addressing current deficits and pass on larger obligations into future years due to purposely underfunding the City’s contribution.
City Council President Stephen Joost asked Finance Committee members during their first meeting in the new Council year to delay a vote on the study waiver.
He said he wanted the pension reform deal currently in Council’s hands to be decided on before they determined such a waiver.
“I believe that issue should be settled first,” he told the committee.
Council Rules Committee members voted to deny the waiver 0-7 the day before.
Finance Chair Richard Clark honored Joost’s request but said then he had “every intention in two weeks to vote it up or down.”
Joost said Monday the two measures go together and approval of the pension reform deal would change the figure the study would calculate by as much as $110 million.
There is no sense in possibly conducting the study on a figure based on old assumptions if pension reform passed, he said.
He will not ask for another deferral of the waiver measure in the Finance Committee like he did two weeks ago, he said.
Instead, he said he will organize the full Council agenda to ensure a vote on the pension reform deal takes place prior to the waiver measure.
Joost said he wasn’t sure of his pension reform vote but was a proponent of waiving the study for another year.
He said Monday he believes the overall economic and market growth will continue over the next year and delaying the study would net better returns for taxpayers.
“I’m hopeful,” he said. “I think we’re going to see it (economy) continue to get better.”
The study will cost $40,000-$50,000, he said.
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