PAWTUCKET â The City Council has scheduled a special session Thursday night to discuss the Grebien Administration's suggested solution to the severely underfunded police and fire pension plan.
The meeting will be held at 6:30 p.m. in the City Council's Office, Room 303, at Pawtucket City Hall. Council President David Moran said he called the meeting so the councilors could learn more details about the proposed Funding Improvement Plan (FIP) that Mayor Donald Grebien's administrative team has developed.
The pension plan, which has a total of 630 participants (350 retirees and 280 active), has assets of $73.4 million, but an unfunded liability of $144.9 million and a total accrued liability of $281.3 million, according to a July 2011 actuarial report. Because it is only about 34 percent funded, it is considered to be in âcriticalâ status by state officials.
Under the proposed FIP, the Grebien Administration is asking all plan participants to agree to a freeze of the annual cost of living (COLA) raises for three years. In return, the city will fund the plan at 3 percent above the annual required contribution (ARC) and to make other reductions in city spending until the pension plan is wholly funded again.
Moran said the main purpose of Thursday's meeting is for the council to be schooled in the finer points of the plan, which is based on an actuary report that starts in fiscal year 2013 and includes a series of escalating payments into the fund over the next 29 years. He said the councilors will be given a presentation on the FIP, and will have the opportunity to ask questions of the finance director and other members of the administration.
Moran noted that the council was just given the FIP at its last meeting and the plan had since been referred to the Finance Committee. He said the meeting will be helpful to the council as it evaluates the plan. The council must approve the FIP before it can be submitted to the state for review by a May 1 deadline.
Moran noted that the âtiming is tight,â especially since the administration is scheduled to testify to state officials as to the status of the pension improvement plan by April 22. âIt would be nice to have something in place because they will need to give an update to the state, so we're shooting for that deadline. Yet, it has to be done thoughtfully and carefully,â Moran said.
Moran said that additional meetings will be scheduled in the coming weeks to gather input from plan participants, retirees, and members of the public on the proposed FIP, as the council weighs its final approval.