Firefighter Pension Plan Passes Unanimously in Chattanooga

By: Kelli Findlay

Chattanooga, TN (UTC/The Loop) — Chattanooga Firefighter and Police Pension Fund receives unanimous city council vote.

On February 25, 2014, Mayor Andy Berke spoke at the Chattanooga City Council meeting and proposed the passing of the Chattanooga Fire and Police Pension Fund. 

Mayor  Berke addressing Pension Plan

Mayor Berke addressing Pension Plan

A pension is a defined benefit paid monthly to employees during retirement. Police officers and firefighters pay into a large fund with 8 to 9 percent of their salaries. The city contributes to the fund each year. In 2013, the city’s contribution was $11.2 million, an amount that’s expected to rise dramatically over the next 26 years. The fund also receives significant revenue from its investment portfolio.

“What you’re going to do tonight by adopting this ordinance is that you will secure the retirement for our pensioners,” said Mayor Berke.

Berke also said that they want to look these men and women in the eye and promise them a financial future with the new pension plan.

 One part of the bill requires those cities to contribute at least 100 percent of the annual amount needed to make or keep the plans sustainable over a 30-year period. This doesn’t affect Chattanooga’s fire and police pension plan because the city already pays 100 percent of its contribution.

Not all citizens approve of this new pension plan. The full opposition story and interviews about the passing of the Firefighter Pension plan covered by Channel 9  can be found here.

Kirk Salter, former Chattanooga Sgt., was upset that they didn’t take everybody’s interest into account. Salter said, “They wouldn’t listen to anybody in 2000 and they are not listening to us now.”

One part of the bill requires those cities to contribute at least 100 percent of the annual amount needed to make or keep the plans sustainable over a 30-year period. This doesn’t affect Chattanooga’s fire and police pension plan because the city already pays 100 percent of its contribution.

Task Force Proposal

The plan requires approval from the pension board and the City Council. Here are the key details.

• Minimum retirement age for non-vested members 50, new hires 55

• Employee contribution to go up from 8% to 11%, or 9% to 12% over the next 3 years

• Cost of living adjustments for retirees at an average of 1.5%

• The DROP will no longer include interest, and employees will have the option to stay 3 extra years without losing the benefit.

• Increases benefits to 100% for beneficiaries of those killed in the line of duty

Sources: Chattanooga Times Free Press, Nooga.com, Channel 9 News

 

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