Minutes 02/14/2017 - Laserfiche WebLink

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February 14, 2017 • In FY 2016, the city paid a contribution of $7.6 million to the systems and a debt service payment on pension-obligation bonds of $10.9 million for a total payment of $18.5 million. In FY 2017, the city will pay a contribution of $8.01 million to the systems and a debt service payment of $10.95 million for a total payment of $18.96 million. • The city’s financial advisors and actuaries recommend reviewing the impact of retirement funding status before determining benefit changes. Discussion:  The retirement systems represent a liability and a significant contribution is made every year to properly fund the systems. The use of pension obligation bonds to increase the funding of the systems increase the city’s debt substantially. The Actuarially Determined Contribution (ADC) required to fund the system continues to increase due to improved mortality rates and lower than anticipated investment returns.  By providing a one-time supplement versus a cost of living increase, and having that amount funded from the city’s General Fund, the city avoids increasing the ADC and there will be no increase to future liability through this action and the funding of the plan remains the same. Financial Impact:  The one-time $500 net supplement for the 1,007 retirees will cost $559,450. The funding will be taken from current year budget savings. . Recommended Action:  Adoption of the ordinance. Vision Principle: Enhanced Quality of Life. Next Steps Following Council Action: • The city will work the retirement plan’s administration to make the programming change for the March payment and the retirement board to inform retirees regarding the one time supplement. 1. Garland Alexander, 2913 Tanbark Lane, spoke in support of this item. 2. Mark Geduldig-Yatrofsky, P. O. Box 50141, spoke in opposition to this item. Motion by Ms. Psimas, and seconded by Mr. Moody, to adopt the following ordinance, and was adopted by the following vote: “ORDINANCE AUTHORIZING PAYMENT FROM THE GENERAL FUND OF A ONE- TIME SUPPLEMENT IN THE NET AMOUNT OF $500 TO BENEFICIARIES UNDER THE PORTSMOUTH SUPPLEMENTAL RETIREMENT SYSTEM AND THE FIRE AND POLICE RETIREMENT SYSTEM.” Ayes: Cherry, Clark, Lucas-Burke, Moody, Psimas, Whitaker, Rowe Nays: None 17 - 83 - Adoption of a resolution adopting the Vision Principles and Guiding Principles of the Portsmouth City Council. Background:  On February 3 – 4, 2017, Portsmouth City Council held a two-day retreat to discuss the future of the city and how Council members can work together to maximize their efforts in achieving moving the community forward. One of the major goals of the retreat was for Council to develop a new vision statement for the City – a statement of what City Council hopes to achieve as it works to move our community to its future. Discussion:  As part of this retreat, City Council developed a new vision that celebrates the city’s history, envisions the future of Portsmouth, and set of guiding principles for the City and its leadership to follow.