There's positive side to Pittsfield Retirement Board's higher budget
PITTSFIELD -- The Retirement Board has begun its review of the next retirement system budget and it reflects an estimated increase from the $594,671 approved a year ago to $679,056 -- but there’s a silver lining.
Most of the estimated increase for calendar year 2013 comes in the form of management fees for the system’s investments, which are expected to rise significantly from $375,000 for the past year to $433,416 in the coming year.
The good news, board members said during their December meeting, is that the management fees are based on a percentage of investment value and are covered by the portfolio’s growth. The system’s portfolio has increased by $8.6 million during 2012 to $88.8 million.
The city’s Retirement Board manages the pension system for all retired municipal employees.
Retirement Board Chairman Gerald E. Miller said the amount of the increase was unexpected but welcome, especially following losses in recent years in the wake of the financial sector meltdown.
A more complete report on the status of the system’s investments is expected from the board’s consultant early next year.
In another matter, the board has received an opinion from attorney Michael Sacco of Southampton relative to a question raised during ongoing municipal employee contract talks concerning firefighters.
The board had been asked about a bargaining proposal that would add a sentence to the agreement to include: "... upon separation from service with a minimum of 20 years of service, an employee may apply unused sick leave to increase said employee’s years of service for retirement purposes."
Citing case law, Sacco said in his written opinion: "Based on the foregoing, it is clear that the proposed amendment to the [collective bargaining agreement] cannot be included to increase a member’s creditable service for the purpose of retirement ... and creditable service, with very few exceptions not relevant to this inquiry, is only permissible in circumstances in which the member receives regular compensation and deductions are withheld from that regular compensation."
The board filed the inquiry without action.