Mayor Berke Accepts Recommendation From Pension Task Force; Details Given

Thursday, January 9, 2014

Mayor Andy Berke accepted a consensus recommendation on Thursday, from the Pension Task Force for reforms to the Fire & Police Pension Fund, pending review by the city’s actuary and legal counsel. The recommendation does not decrease monthly pension checks for retirees, he said. Based on initial estimates, the Pension Task Force "believes their recommendations will save taxpayers approximately $4 to $5 million annually and will ensure the fund is financially healthy for retirees in coming years."

“After months of discussion, the Pension Task Force has reached a consensus recommendation that puts the pension plan on a sustainable path in a fiscally responsible way,” said Mayor Berke. “I have reviewed the recommendation, and I am confident this is a strong set of benefits that will reach our shared goals for the Fire & Police Pension Fund.”

“This was difficult work, and I thank the Pension Task Force for the time and effort they put into this process. I’d also like to recognize the representatives of retiree and employee groups, like FOP, IBPO, and IAFF. They showed true leadership and solved a problem that had threatened their members retirement security; police officers and fire fighters should be proud of how strongly they were represented through this process,” he said.

The recommendation made by the Pension Task Force is subject to legal and actuarial review and includes the following: 

  • 100% benefits for public safety employees killed in the line of duty (31.25% increase);
  • An increase in benefits payable to elderly widows of public safety employees, currently received only $500 per month;
  • Sustained, yet cost-neutral, DROP benefit;
  • Temporary reconfiguration of the COLA structure so that those employees who receive the lowest pension benefits receive a higher COLA; and
  • Increased employee contributions phased in gradually over the next three years.

Last August, Mayor Berke formed the Pension Task Force and charged it with finding a consensus approach to reform benefits provided by the Chattanooga Fire and Police Pension Fund. The Pension Task Force aims to ensure the pension plan achieves the following:

  • Attract public safety employees and encourage them to have long careers with the City;
  • Meet the City's obligations to police officers and firefighters; and
  • Use taxpayer dollars responsibly in order for Chattanooga to fund present day public safety initiatives.

Click here to read the recommendation.

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