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Simsbury selectmen approve clarifying amendment to retirement plan; actuary finds change cost-neutral
Summary
On Oct. 15, 2025, the Simsbury Board of Selectmen approved a clarifying amendment to the town's retirement income plan that specifies benefits for terminated vested employees who defer the start of retirement payments; the town actuary Milliman concluded the change is actuarially cost-neutral.
The Simsbury Board of Selectmen on Oct. 15, 2025 approved a clarifying amendment to the town’s Retirement Income Plan to specify that a terminated vested participant who defers the commencement of benefits will receive the actuarial equivalent of the vested accrued benefit and that a commencement date cannot be later than the participant’s required beginning date.
Town Manager Mark Scully explained that two former employees who deferred retirement had highlighted an ambiguity in the plan language about whether monthly benefits should be increased as a result of deferral. Milliman, the town’s actuary, provided a cost analysis concluding that the proposed wording change is actuarially cost-neutral. Scully summarized the purpose: the amendment clarifies how deferred commencement is calculated and avoids unanticipated retroactive payouts.
Scully used a simple example from the actuary packet to demonstrate the mechanics: in the exhibit example a $3,000-per-month benefit adjusted for deferral would be shown as approximately $3,300 when actuarial equivalence is applied. He told the board that the change is intended to clarify administration of the plan rather than to alter benefits for existing retirees.
Selectmen asked questions about long-term actuarial assumptions and whether future changes to interest rates or mortality tables could affect the plan. Staff acknowledged those risks and said updating the plan’s mortality table is on the near-term agenda; the town will ask Milliman to review current mortality assumptions in the spring.
The board voted to adopt the amendment effective Oct. 15, 2025. Meeting materials included a Milliman letter dated Oct. 8 that described the actuarial analysis and cost-neutral conclusion. The amendment will be administered under the town's existing pension governance procedures and does not change contribution rates or the town's actuarially required contribution for the current plan year.
