Greensburg police pension liability will rise once again in 2015
The city of Greensburg’s police pension costs will exceed $1.2 million in 2015, the latest in a string of record-high years.
Next year’s cost constitutes an increase of $174,000 compared to 2014.
Without additional revenue or cost reductions elsewhere, Greensburg would need to raise taxes by 1.5 mills to cover the gap, said Councilman Randy Finfrock, director of accounts and finance.
The city will be responsible for about $832,880 of the cost. The state will probably provide $375,000, and about $128,000 will come from police officer contributions.
Council is expected to approve the expense when it meets on Monday night in city hall.
The problem of increasing pension costs is not limited to Greensburg.
The city’s pension plans are among those of 573 municipalities — almost half of all communities statewide — labeled as “distressed” by the state Public Employee Retirement Commission.
Police pension costs have been increasing sharply in Greensburg for several years, rising to more than $1 million for the first time in 2014.
Several officers have retired in the past few years, increasing overall pension costs, according to city Administrator Sue Trout. More will likely be retiring soon, she said.
Revenue from interest on the city’s investments, which help to cover pension costs, has yet to recover from the economic downturn, Trout said.
And increasing pension costs show no sign of abating in the short term, Trout said.
The increase can be stemmed only by decreasing police benefits, higher state contributions or better returns on the city’s invested money.
“Those are the only ways that this could come down,” Trout said.
Many retired officers receive 60 percent of their salaries in their pensions.
Until recently, officers were allowed to retire with full benefits after 20 years. This led to officers retiring in their 40s and obtaining other jobs, Trout said.
In 2009, the city and police revised the officers’ labor contract. Those hired after January 2009 receive half their salary in pension payments and are not able to receive full benefits unless they are at least 50 years old when they retire.
The cost of nonpolice pensions in Greensburg will be $174,623 in 2015, up about $52,000, according to city officials.
Jacob Tierney is a staff writer for Trib Total Media. He can be reached at 724-836-6646.
Jacob Tierney is a Tribune-Review staff reporter. You can contact Jacob at 724-836-6646, email@example.com or via Twitter .