The Plymouth County Retirement Association has given its members a breather, pushing the funding deadline for past retiree benefits to 2034 and cutting the fiscal 2015 assessment nearly in half.
The revision, approved by the association’s board last Tuesday, still requires subsequent increases of 8 percent a year until the underfunding is eliminated, but board members said the deal is the perfect compromise.
“This is the benefit of having a local retirement board; we’re available . . . to address concerns people have,” said Plymouth County Treasurer Tom O’Brien, one of five voting members on the board. “We were glad people came, we appreciated their advocacy, and responded by taking the vote they were looking for.”
Many of the 55 association members, which include municipalities, regional school districts, housing authorities, and regional agencies that supply services such as fire protection, water, trash collection, and health advocacy, were facing increases of 20 to 30 percent in their pension contributions for fiscal 2015, which begins next July 1. The increases translated into hundreds of thousands of dollars in some communities.
The money was intended to fully fund pension obligations for current retirees, whose pensions currently are 50 percent funded. Before Tuesday’s vote, the deadline was 2030.
Bill Farmer, executive director of the retirement association, said that though things seem rosy now, they will not be for long. Member communities will end up paying a total of $360 million more from 2030-2034 to make up for lost revenue stemming from missed investment opportunities.
Officials from southern suburbs understand that dynamic, but said they really had no choice.
“If it didn’t get extended, it was really going to cripple a lot of communities . . . ,” said Marshfield Town Administrator Rocco Longo.
Though Scituate town officials are grateful for the fiscal 2015 reduction, the 10.5 percent increase will still be hard to swallow. The annual 8 percent increases henceforth was also disappointing, officials said.
“We as a town need to take a closer look at this, and see if there are other available avenues to address these pension issues,” said Scituate Selectman John Danehey.