The Paducah City Commission will consider a raise for the Police and Firefighter Pension Fund (PFPF) after an impassioned plea by former fire chief Leon Dodge, who serves as the fund's board chairman.
Dodge spoke Tuesday to the City Commission on behalf of the 60 individuals who participate in the plan. Its members, who did not pay into Social Security during their careers, see an average monthly payment of $1,940.
Eleven of the 60 - most widows - receive the minimum monthly payment of $723. The highest individual payment is $4,304, Dodge said.
Dodge asked the board to consider a 2 percent raise, or a $210,000 one-time payment by the city to the fund.
The plan was created in 1956 to provide retirement, disability, and death benefits for police and firefighters and their beneficiaries. Once the plan closed to new entrants in 1988, members had the choice to transfer to the state plan or remain in the city's plan.
According to City Manager Jeff Pederson, the fund is not solvent and relies on substantial funding from the city.
In 2005, the city issued a $6.1 million general obligation bond to fund the pension fund's unfunded liability.
"Even after the bond, the city has had to appropriate funds from the annual budget to meet obligations," Pederson said.
Last month, the city refinanced the 2005 bond, saving approximately $365,000 in interest payments over the remaining life of the bond.
Because the city is in better shape financially this budget year, Pederson said, the city may be able to consider pension payment increases.
Any increases to the plan going forward would need to be pre-funded. The last cost of living increase to the pension fund was in 2008.
As the one-time payment would not exceed the savings the city realized from refinancing the bond, Commissioner Carol Gault expressed her support for the 2 percent increase. Commissioner Richard Abraham agreed.
"Prior to this year, as stated by the city manager, we didn't have the room to do what we are doing now. I think we should help folks out," Abraham said.
Commissioners Allan Rhodes and Sandra Wilson asked for appropriate time to study the fund.
A possible resolution will be brought before the commission at an upcoming meeting.
In other news from Pederson, negotiations should begin within the next couple of weeks regarding the animal shelter. Pederson stated he and Mayor Gayle Kaler met earlier Tuesday with Judge-Executive Van Newberry and Deputy Judge-Executive Doug Harnice regarding an agreement among the city, county, and the McCracken County Humane Society regarding animal shelter services.
Contact Carrie Dillard, a Paducah Sun staff writer, at 270-575-8657.
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