Springfield Standard

Representatives from Milliman, Inc., a financial firm tasked with evaluating the City of Springfield's Police Officers’ and Fire Fighters’ Retirement System, provided an update to the Police-Fire Pension Board on October 10. The pension plan is currently funded at 94.8%, a significant improvement from its low point of 34% in 2009.

Tony Kelley, pension administrator and former firefighter, commented on the progress: “Most financial advisors consider 80% funded to be healthy. We are at the gold standard level and nearly across the finish line.” He attributed this success to well-invested assets and support from a ¾-cent sales tax.

The original police-fire pension plan faced severe underfunding until Springfield citizens voted in favor of implementing the sales tax in 2009. This tax has been renewed twice and will end in March 2025. The city contributes approximately $5.4 million annually from general revenue to support the plan, which has been closed to new members since 2006. New hires join the state's retirement plan (LAGERS).

All revenue from the sales tax has been allocated to the pension fund since April 2010, overseen by the Citizens’ Tax Oversight Committee. Mayor Ken McClure emphasized its importance: “Police officers and firefighters do not receive Social Security benefits; thus, providing a competitive retirement plan (pension) is vital to the City’s ability to recruit and retain high-quality public safety staff.”

Despite reaching a healthy funding ratio, an estimated $3.5-$6 million per year is still required for full funding of remaining liabilities over several years. Mayor McClure noted that an initiative on November's ballot proposes replacing the original sales tax without increasing rates, alongside proposals for increased pay for officers and capital improvements.