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City revises pension ordinance

Firefighters’ plan has been subject of repeated state audit findings

City Council has introduced a revision of the firefighters’ pension ordinance designed to bring the ordinance into line with collectively bargained provisions of the firefighters’ pension plan.

The ordinance has been the subject of repeated state audit findings, including those noted in the city’s Act 47 distressed municipalities program recovery plan and in a recent news release from the state auditor general.

The corrections will help ensure that the state won’t penalize the city by withholding pension aid and highway aid funding as a result of the repeated findings, said City Councilman Michael Haire.

The problems took three years to correct, and required heavy negotiations, according to Haire.

One obstacle to completing negotiations was the death of the attorney representing the firefighters, Haire and City Manager Marla Marcinko said.

It took a while for that attorney’s replacement to familiarize himself with the issues, Marcinko said.

The ordinance was less generous than the plan for most of the provisions that were in conflict — for firefighters hired before 2014.

The existing ordinance calls for retirees to be eligible for pensions only after reaching age 55, while the plan allows for those hired before 2014 to be eligible after 20 years of service, regardless of age.

The existing ordinance calls for pension benefits not to exceed half the maximum salary being paid to active firefighters, while the pension plan sets the cap at 75 percent of the retiree’s original pension benefit.

The existing ordinance doesn’t include a definition of full salary, while the pension plan defines full salary as comprising regular salary, plus longevity, holiday and overtime pay.

The existing ordinance doesn’t mention deferred retirement option plans (DROPs), but the pension plan includes that option.

The existing ordinance allows vesting after 25 years, while the pension plan permits it after 12.

The existing ordinance calls for members to contribute 5 percent of their pay, plus $1 a month toward the service “increment,” while the pension plan calls for 5 percent, plus $5 a month toward that service increment.

The existing ordinance calls for paying 100 percent of normal retirement benefits upon disability, while the pension plan calls for paying 25 percent of annual compensation after 10 years’ service and 50 percent of annual compensation after that.

The existing ordinance calls for payment of $100 a month in service increment after a normal retirement, while the pension plan calls for payment of $500 a month.

While most of the conflicts were between the pension ordinance — the “governing document” — and the pension plan itself, there was one prior conflict between the pension plan and the Third Class City Code, which is part of state law.

That was an illegal addition of $100 to pensioners’ service increment.

It brought their total increment to $200 when the state maximum was $100.

And it brought their total increment to $600 when the state max was $500.

That illegal payment has been negotiated out of the contract with the firefighters, Haire and Marcinko said.

The city is now under home rule, but for pensions, the Third Class City Code still applies, Marcinko said.

Mirror Staff Writer William Kibler is at 949-7038.

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