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R -19 -24 <br />A RESOLUTION DEDICATING ALL SAVINGS REALIZED FROM THE <br />REFINANCING OF THE CITY'S 2013 PENSION OBLIGATION BONDS TO THE <br />PORTSMOUTH SUPPLEMENTAL RETIREMENT SYSTEM AND THE <br />PORTSMOUTH FIRE AND POLICE RETIREMENT SYSTEM FOR THE SOLE <br />PURPOSE OF ENHANCING THE FUNDING STATUS OF THE SYSTEMS. <br />WHEREAS, the City of Portsmouth has two closed pension funds, the Portsmouth <br />Supplemental Retirement System (PSRS) and the Portsmouth Fire and Police Retirement System <br />(PFPRS); and <br />WHEREAS, in 2013 the City issued nearly $170,000,000 in Pension Obligation Bonds <br />(the POB) to significantly improve the funding status of the PSRS and PFPRS; and <br />WHEREAS, while the POB were effective for that purpose, the funding status of the <br />plans has declined since the injection of the bond proceeds in 2013; and <br />WHEREAS, market interest rates have fallen significantly since 2013, and the City <br />therefore has an opportunity to refinance a portion of the POB and achieve a savings of several <br />million dollars by issuing refunding bonds; and <br />WHEREAS, by Ordinance 2019 -34 adopted on May 28, 2019, City Council authorized <br />the issuance of refunding bonds; and <br />WHEREAS, it is anticipated that the refunding bonds will be issued in August of 2019; <br />and <br />WHEREAS, the savings from the issuance of the refunding bonds will be structured to <br />reduce the City's FY 2020 debt service payment obligation on the POB, which will make money <br />that was originally budgeted to pay debt service available for a direct contribution to the PSRS <br />and PFPRS; and <br />WHEREAS, using the savings realized from the refinancing of the POB to make direct <br />contributions to the PSRS and PFPRS will improve the funding status of the plans; and <br />WHEREAS, City Council recognizes that providing adequate funding to meet its <br />pension obligations is critical to the City's financial health, both from the standpoint of <br />maintaining the City's present credit rating and from the standpoint of ensuring the City's future <br />liquidity; <br />NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Portsmouth, <br />Virginia, that the City Council hereby commits to use any savings realized from the issuance of <br />FY 2020 refunding bonds to make a direct contribution to the PSRS and the PFPRS for the <br />purpose of enhancing the funding status of the systems, and for no other purpose; and <br />