Pine Bluff voters have an opportunity to extend a hand to retired firemen and policemen who put their lives on the line for us by increasing the millage that funds the Firemen’s Pension Fund and Police Pension Fund.
A millage referendum will be on the May 22 preferential primary ballot asking for approval of a proposed 0.4-mill increase on property taxes citywide to help prevent the pension funds for more than 150 uniformed public safety employees and their spouses from becoming insolvent.
The city currently levies for each fund an annual tax of 0.8 mill on the assessed value of real and personnel property in the municipality. State law allows a maximum amount of 1 mill to be applied to each fund.
Voters will be asked to raise the millage by 0.2 mills each for the Firemen’s Pension Fund and the Police Pension Fund to 1 mill. The firemen’s fund has been deemed “projected insolvent” by the Arkansas Fire and Police Pension Review Board, which uses actuaries and analysts to assess whether the 144 locally run pension funds that remain operational in the state have the funds to sustain making pension payments to their members for the next 10 years.
In December the city of Pine Bluff and the Firemen’s Pension Fund Board were notified that the firemen’s pension had been placed on the review board’s “projected insolvent” list.
Independent reporting for Pine Bluff & Jefferson County since 1879.
While the police fund is not projected to become insolvent in the next 10 years, it is still an “underfunded” plan.
If voters approve the increase, collection of the taxes will end when the final recipient leaves the pension rolls.
The pensioners, who all worked for the police or fire departments for at least 20 years, do not receive Social Security benefits for the years working for the city, thus in most cases are dependent on the pension funds. A number of municipal pension funds for public safety employees across the state are facing the same issues.
The state established a retirement fund for municipal fire and police personnel in 1983. After 1983, newly hired uniformed employees were required to join the state-run plan and are no longer paying into the two local funds. Low interest rates paid on municipal funds and the lower number paying into the local funds has been cited as the key problems.
The Pine Bluff City Council elected to hold the pension referendums on May 22 to save about $60,000 projected cost for a special election.
Without the millage increase, the pension funds shortfall will have to be made up either by a reduction in benefits to retirees or by the city contributing tax dollars directing from the city’s general budget. With the millage, the likelihood of a benefits reduction is decreased, as is the amount the city would have to contribute to the funds.
Often the public is opposed to any tax increase. It is essential to counter that reflex in this case because the individuals who will suffer are the same people who risked their lives for us, worked six-day weeks and long hours under difficult circumstances. Without the increase, the impact on the retirees, as one official said, would be “devastating.” Certainly, anyone depending on Social Security or planning to depend on Social Security can imagine the reaction if suddenly that well ran dry. These retired police and fire fighters are in the same situation.
Approval of the two referendums means the owner of a home with an assessed value of $75,000 would pay an additional $3 per fund, or a total increase of $6 per year.
The millage increase is set forth on the ballot as two separate questions, as necessary since there are two separate funds. We encourage voters to go to the polls on May 22 and cast a ballot “FOR” both millage proposals. These folks put their lives on the line for us daily; this is the least we can do in return.