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Macon police, fire pension funding may get boost

Macon is moving toward catching up with its required contribution to police and firefighter pension funds, but at a heavy price -- and, added to other looming spending increases, without a set plan to cover the extra cost.

“We did not budget for this expense,” said Keith Moffett, the city’s Internal Affairs director. “We are asking for an (approved budget change) to be paid back over a time period.”

An ordinance sponsored by city Councilmen Mike Cranford and Charles Jones moved Monday through the council’s Appropriations Committee in a 4-1 vote, with only Councilwoman Elaine Lucas voting no. It would dump $1.2 million into the police and fire pension fund for the rest of this fiscal year, thus meeting an actuarial requirement to put in far more money than in previous years. The proposed ordinance may come before the full council for a vote at Tuesday’s meeting.

The required contribution to keep the fund solvent long-term jumped to 16.44 percent after a biennial actuarial review found that the value of its investments had fallen sharply while more retirees were drawing sizable pensions. Much of that value has been recovered, but the required contribution won’t change until after another actuarial study this coming summer. Meanwhile, the city has to make up for nearly two years of underfunding, plus 8 percent interest -- a total of about $4 million so far.

The currently proposed increase of $1.2 million would come out of the city’s general fund balance, which has $4.6 million, and the “Filomena Fund,” which contains $6.5 million, Finance Director Tom Barber said. The Filomena Fund is named for late former Councilwoman Filomena Mullis, who urged creation of a $6 million pool to tide the city over the summer period when little revenue comes in.

Throughout the discussion, Charlie Bishop, a former city police official and a member of the Fire and Police Employees Retirement System board, smiled and nodded. Before leaving, he remarked quietly that he recommended exactly this action three months ago.

Councilman Virgil Watkins asked how close the extra spending will take the city to “dead broke” this year.

“From a cash standpoint, we should be OK,” Barber replied. It’s smarter than leaving the money in the Filomena Fund, which is only earning four-tenths of a percent interest, while the pension deficit must pay 8 percent interest, he said.

The city’s fund balance needs to be increased to about $18 million, not reduced further, but there are no good choices available, Councilman Tom Ellington said.

“Since I don’t see any other way, I’m going to support this,” he said.

Barber, who’s leaving at the end of the week to become city administrator of Fairburn, highlighted the fact that this appropriation would only cover the next six months of required contributions.

“Next year in the budget, we’ll have to do this (again), or something similar,” he said. That will take another $2.4 million, plus $2.4 million more for the recently-approved city employee pay plan, replenishment of the general and Filomena funds and further repayment of the pension underfunding, Barber said. Next month, the city also will learn the amount of its new required contribution to pensions for general employees, likely to require about $1 million, he said.

The proposed ordinance calls for restoring the fund balance within two years, while also catching up with pension funding and interest during the next five years.

Moffett said the city hopes to cover that increased spending by unspecified further cost-cutting and leaving vacant jobs unfilled. In November, Macon Mayor Robert Reichert suggested finding cash quickly by selling the Willie C. Hill City Hall Annex and Macon City Auditorium, having them retrofitted for energy efficiency and then leasing them back for a number of years. After that, the city would be obligated to buy the buildings once again.

Moffett said Monday the administration is still examining that idea, seeing how similar deals have worked in other cities.

Police cars

Before Lucas arrived, the committee voted 4-0 to approve buying 30 new Ford Crown Victoria police cruisers from Riverside Ford for $643,729.20, or $21,457.64 per car.

That doesn’t include equipment such as light bars, Police Chief Mike Burns said. The equipment package is still being bid, but all the new cars will have digital cameras, he said.

Answering a question from Ellington, Burns said the oldest remaining cars in the police fleet will be 1998 or 1999 models.

“For every new car we get, we put a car down from the fleet,” he said.

Riverside Ford offered the lowest bid of seven in a tight field, according to the bid tally. The highest bid, from Legacy Ford, was just $575 more per car, while Riverside undercut the second-lowest, Peach County Ford, by just $6.36 per car.

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