Council told sales tax increase needed
Those covered by the Police and Firemen's
The city's finance director,
She said the city would need about
Currently, the fund has only enough value to cover about 63% of the benefits that will be owed to those covered. Next year, the city will have to pay in about
Those contribution costs are straining the city's general fund, Haase said.
Haase told the council the work group supports the proposal to use revenue from a half-cent sales tax that would provide a projected
City officials have discussed proposing the sales tax increase for 12 years or until the pension is funded to 120% to assure there would be enough to pay all the benefits owed and to cover any losses in the value of the fund if investment values dipped.
Haase told the council that the meaning of closing out of the fund is that it would be frozen from accepting new police and fire employees. New hires would be covered by a state pension fund that Haase said would cost less.
Council member
She said that it is difficult to project how many years the tax would be needed to reach that level because sales tax collections may not always meet projections.
Council members will vote at a later meeting on whether to propose the tax, though some members voiced support for it.
The fund covers 120 retirees, 60 current employees who were employed before 2009 and a number of employees hired since then, though that number was not given during the discussion.
Stinnett was skeptical of the actuarial estimates. "I know actuaries don't always hit the mark," he said.
Haase said the work group used the experience that the city of
Council member
"It's about recruiting and retention" of public safety workers, Haase said.
The police and fire departments earlier experienced a shortage of applicants and saw a number of employees resign to work elsewhere, causing union members to demand higher pay and other benefits.
Members
The city work group for police and fire retention includes Mayor
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