In a February 13, 2012 letter to the City Council, the Chairman of the Annapolis City Police & Fire Retirement Commission is asking the City to meet its obligations to the pension fund by making a onetime contribution of 8.3 million dollars to bring it up to a “normal” level.
The lion’s share of the $8.3 million is due to a court decision regarding the COLA (Cost of Living) increases. The City assumed that they would prevail in the litigation; but the trust was required to pay the costs. Now they seek to be repaid.
Currently the pension is only funded at 87% and the City has not made a contribution in several years. As Mayor Cohen and the City Council try to dig themselves out of a financial mess, this is yet another unexpected expense that will need to be addressed.
The City is in the midst of preparing the budget for next year and reports from City Hall have indicated that the Mayor and Council have made much progress in getting the City back on the right track. The City has borrowed (and re-paid) several multimillion dollar bridge loans in order to meet then-current obligations. It remains to be seen if a similar loan will be needed again this spring.
Unexpected expenses have been a hallmark of Mayor Cohen’s administration. First there was the TIF payment for the Park Place garage, and currently they are looking at more money to be put into the still-closed Market House.
- Mayor Cohen: Market House Update (eyeonannapolis.net)