The Longboat Key Town Commission knows it has a major problem with its three pension plans.
But it’s not sure how to fix a growing unfunded liability problem that has town taxpayers responsible for at least $21 million in unfunded liabilities.
At a special pension workshop Monday, Nov 16, the Town Commission heard from its actuary, pension attorney and a financial management director regarding the problems it faces with its three pension plans.
Before any discussion, however, the commission continued to hear negative reports about its pension plans and received no clear direction on how to solve the problem without spending a large amount of money.
Town pension attorney James Linn, of Lewis Longman & Walker, told the commission the total annual costs for the town’s police, firefighter and general employee pension plans total $2.2 million per year, about 30% of the town’s payroll costs and 15% of the general fund’s operating budget.
The town can reduce benefits to its employees, increase employee contributions, terminate the plans or freeze them, Linn said. However, any of those options won't cure the problem.
"There is no silver bullet that’s going to fix your problem," he said.
Reducing benefits for all employees, Linn said, is the only way to significantly create an immediate cost savings that will reduce unfunded liabilities.
For more information about the four hour meeting and the commission’s discussion, pick up a copy of the Nov. 19 edition of The Longboat Observer.
Contact Kurt Schultheis at [email protected].