Special Council session on city's pension system
Cincinnati Council held another special meeting Wednesday night to discuss the city's troubled pension system.
Like many plans around the country it has a large unfunded liability, meaning without changes eventually there won't be enough money to pay promised retiree benefits.
Council Members Charlie Winburn and Christopher Smitherman called the meeting.
Winburn asked retirement system Executive Director Paula Tilsley if there are plans to change the annual cost of living adjustments for current retirees. She said the board is concerned about the three percent compounding COLA.
"It is the most expensive provision in the plan and it is the provision that many other municipalities and states have been changing if they had something in that area," Tilsley said. "But many municipalities and states don't have a 3 percent compound. They have no COLA, or they have a simple COLA or something lower than a 3 percent."
Council made a change a couple years ago meaning future retirees will only receive a simple COLA.
Smitherman asked City Manager Milton Dohoney about what steps the city needs to take to stabilize the pension system.
"More money in, figuring out where that more money will come from, looking at the current picture of the benefits themselves, and some way of financing it short of putting lump sums of cash in," Dohoney said.
Some Cincinnati retirees sued the city in 2009 for changing their health care coverage. A Hamilton County Common Pleas judge and the Ohio First District Court of Appeals ruled in the city's favor.
City Solicitor John Curp told Council the Ohio Supreme Court has declined to hear the case.
"Which means the First District Court of Appeals opinion which ruled that the city may adjust healthcare benefits for retirees, we won that case," Curp said. "It was a three year case. I think that case alone cost about $300,000 in attorneys' fees, but the savings to the pension system was close to $300 million."
The retirement board will present the 2012 report for the pension fund to Council in May.