City pension obligations up
The obligation to fund the city’s three pension funds next year is $3.9 million, or $82,370 more than this year.
City Council Thursday accepted the minimum municipal pension obligation the city must provide by Sept. 30.
Revisions may be made up to the time the budget is finalized, said William E. Nichols Jr., city finance director.
The police pension fund is $1.6 million, fire pension is $1.4 million and officers’ and employees pension is $872,233.
“It could be changed and be more or less with the 2017 assumptions in a month,” Nichols said.
Council was provided a letter from Colleen A. Deer, president of Mockenhaupt Benefits Group, regarding the pension funds.
Pension obligations have put the city in the hole even larger in the past.
“I can see a rough budget season,” Councilman Clifford “Skip” Smith said.
Mayor Gabriel J. Campana told the Sun-Gazette he has been and will continue to seek investment opportunities and ways to bring in funds and added revenue into the city.
When asked how that could be done, with the pension funds growing each year, Campana said “by speaking with other mayors.”
The city also has taken a step toward a refinancing strategy. Taking advantage of low interest rates, it has agreed to a $21.2 million bond that will require final sale approval the next council meeting.
With the interest rates low, the city can realize $350,000 in savings over the first three years, and $500,000 over the life of the bond, which matures at 2038.
“We’re not taking on more debt,” explained Council President Jonathan Williamson. “Nothing other than refinancing at a lower interest rate.”
Nichols assured the city there would be no eligible new projects attached to this bond.
However, the city has borrowed $2.5 million that was to go toward renovations of City Hall and a $1 million rolling line of credit for Williamsport Parking Authority.
All of the city’s outstanding debt will be covered in this bond, said Councilwoman Liz Miele, chairwoman of the city finance committee.