A pension fund set up for staff of the City’s Police and Fire Pension Fund has drawn differing opinions on whether its board had the authority to create the Senior Staff Voluntary Retirement Fund.
City General Counsel Cindy Laquidara provided an opinion on the issue Aug. 10 stating, “There was no authority for the Police and Fire Pension Fund Board of Trustees to create the Senior Staff Plan within the 1937 Police and Fire Pension Plan.”
The fund responded Sept. 25 through its counsel Robert Klausner, who stated that the board did have the authority through the City’s Charter.
“Section 22.04 which grants the board broad powers, including the flexibility to fix the compensation of its administrator.”
Klausner considered the pension as deferred compensation, which the board had the authority to adjust, he stated.
Laquidara said discussion between the Office of General Counsel and fund board is at the preliminary stage.
“It was discovered at the beginning of the budget, it’s in a list of things we need to address,” said Laquidara.
The staff pension fund was discovered by City Council auditors during the budget deliberations in August. Council Auditor Kirk Sherman informed Office of Ethics, Compliance and Oversight Director Carla Miller that his office was not aware of the fund until 2012.
Miller is also studying the formation and transparency of the fund.
As of Sept. 30, 2011, the assets in the fund were more than $2.3 million, according to the office’s report.
When asked what the next step would be in discussion of the staff retirement plan, Laquidara said that communication was ongoing.
“I’m not going to discuss the strategy the City is going to engage in in order to recover funds that were not appropriately disclosed or expended. Our goal, of course, is always to get them back,” said Laquidara.
The fund has one retiree, one surviving spouse and one active member, Police and Fire Pension Fund Executive Director John Keane.
Council member John Crescimbeni, also chairman of the Finance Committee, appeared before the fund’s board at an Aug. 15
meeting to relay Laquidara’s opinion. After reviewing the legal opinion from the pension fund, Crescimbeni discussed the need for a judicial opinion on the matter.
“I suggested to (fund Director John) Keane that we may need to ask for a declaratory judgment to get this all worked out,” said Crescimbeni.
The fund board would prefer to avoid going to court over the issue, according to Bobby Deal, board chairman.
“Hopefully we’ll be able to sit down and resolve these issues. When you start talking about pensions and benefits you are talking about people’s lives, their compensation. We just want to make sure everything is done appropriately, legally and it takes its proper course,” said Deal.
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