CIVILIAN PENSION BOARD

The Civilian Pension Board met on February 8, 2006 at 2:37 p.m. with Chairman Ruane presiding. Members present were Mr. Hogan, Mr. DePrima, Mrs. Mitchell, Mrs. Braun, Mrs. Rigby, and Mr. Lucas.

AGENDA ADDITIONS/DELETIONS

Mr. Hogan moved for approval of the agenda, seconded by Mr. Lucas and unanimously carried.

Annual Review of Pension Benefits Paid to All Civilian Retirees (COLA)

During the Civilian Pension Board Meeting of January 27, 2000, members directed the City Clerk to maintain a permanent pending agenda item to review pension benefits paid to City of Dover retirees (COLA) prior to the third week in February each year.

Mr. Lucas presented to members a form that indicated changes that have taken place in the Civilian Pension COLA’s and noted that, to date, the Civilian Pension COLA is down nine percent (9%) (Attachment #1).

Responding to Mr. Lucas, Mrs. Mitchell noted that some of the retirees receive both Social Security and a Pension and in order to get the correct increase both of these numbers would have to be added together. She also stated that those retirees who do not receive Social Security are usually younger retirees who take on other forms of employment and do not live solely on a pension.

Mr. Lucas noted that Social Security has been increased in order to keep up with inflation and the consumer price index; however, he indicated that the pension benefits continue to lag behind.

Mrs. Mitchell indicated that she would not recommend a COLA due to the unforeseen impact on the unfunded liability, which is now at 27%. She would like this trend to turn around prior to recommending a COLA .

Mrs. Rigby stated that for several years, COLA’s were not provided for retirees of the Civilian Pension Plan. She noted that the Police Pension Plan has an automatic annual two percent (2%) COLA and strongly suggested that this be considered for the general pension plan retirees.

Mr. Hogan stated he is bothered by the fact that the unfunded liability is growing and explained that, in order to address the unfunded liability, the City must include funds in the budget.

Mr. Pike stated that a 2% COLA would cost approximately $500,000 and suggested that this be included in the budget instead of paying for it over a period of nineteen (19) years.

Mrs. Mitchell moved to recommend that Council consider a priority of fully funding a one percent (1%) Cost of Living Adjustment (COLA) increase for active retirees as of December 31, 2005 by making a direct contribution of $280,000 to the Civilian Pension Plan. Mr. Hogan seconded the motion.

Responding to Mr. DePrima, Mrs. Mitchell stated that the COLA has not been included in the Budget. Mr. DePrima questioned if members would prefer to add to the liability or use funds earmarked for other projects. He suggested that the motion not be specific with regards to funding but simply recommend granting a 1% COLA.

Mrs. Mitchell indicated that she felt that the 1% COLA should be fully funded and not be added to the liability.

Mrs. Mitchell withdrew her motion, as did Mr. Hogan his second.

Mr. DePrima stated that the COLA should be tabled until further review of the Budget.

Mr. DePrima moved to table the matter of a Cost of Living Adjustment (COLA) increase and reconvene within two months. The motion was seconded by Mrs. Mitchell and carried with Mrs. Rigby, Mrs. Braun, and Mr. Ruane voting no.

Mr. Lucas moved for adjournment, seconded by Mrs. Mitchell and unanimously carried.

Meeting Adjourned at 3:23 P.M.

                                                                                          Respectfully submitted,

                                                                                          Eugene B. Ruane

Chairman

EBR/jcr

Dover_1cityclerkClerksOfficeAgendas&MinutesMisc-MinutesPENSION2006