City Hall’s 4,200 retirees likely may wait years before seeing another cost-of-living adjustment in their pensions.
In a report to City Council on Monday, Leo Griffin, director of the Richmond Retirement System, projected that 2029 may be the earliest that cost-of-living adjustments are considered for enrollees in the defined benefit pension plan. The defined benefit plan provides a guaranteed pension that depends on the salary earned.
Mr. Griffin’s report suggested the city would be better off waiting until 2033 to consider pension improvements. That is when the system is projected to be fully funded and the city’s yearly
contribution for the pension plan is projected to plummet 81 percent from around $55 million a year to $10 million a year.
Mr. Griffin’s projections assume that the system achieves an average annual 7 percent return on investments.
If that level of return is received, his report indicates that the system would cross the 80 percent threshold of funding in six years – the funding threshold the retirement system has set before any cost-of-living adjustment could be considered.
Author(s): Jeremy M. Lazarus
Publication Date: 10 Nov 2022
Publication Site: Richmond Free Press