La Plata finance committee backs 457 retirement plan; council delays final budget decision as utility rate increases proposed

At a La Plata Town Council meeting, volunteer members of the town finance committee recommended that the town adopt a 457 retirement plan option rather than create and manage a standalone town pension, while town staff presented three draft FY2026 budgets and proposed modest utility rate increases to address capital and operating shortfalls. The council voted to amend the budget calendar and agreed to continue budget deliberations at a later meeting.

The finance committee presented a comparison of retirement approaches and concluded the committee “is in full support of providing some additional retirement program to the police and the qualified people in public works,” but warned that having the town manage its own pension would be “extremely financially risky to the town,” said Mike Ann, speaking for the committee. The presentation cited actuarial, legal and administrative complexity and pointed the council toward existing providers and 457-style plans used by other public employers.

Treasurer Larson told the council she had prepared three budget scenarios: the town manager’s draft, a draft that assumes the previously discussed “enhanced pension” option, and a third that implements the finance committee’s recommendations. Larson said the enterprise funds would be affected by the council’s decision on the general fund and noted that a sanitation fund shortfall remains regardless of which general-fund option is chosen.

Staff recommended a modest 3% increase in water, sewer and stormwater rates and a $3-per-quarter increase in the town sanitation fee (from $100 to $103 per quarter) to cover rising personnel and landfill costs and to build reserves. According to Larson’s presentation, the proposed changes would leave the sewer fund with an estimated surplus of about $220,000 to support capital or reserves, the stormwater fund with roughly $130,000, and the water fund with a small surplus. The sanitation fund faces a deficit of roughly $90,000 to $100,000 under current projections.

The council and committee also discussed outside studies. Finance committee members referenced a Bolton report when contrasting pension options and recommended financial literacy and employer contributions into 457 accounts as a lower-risk approach. Treasurer Larson and council members also referenced a Baker Tilly draft study on utilities; staff said Baker Tilly’s recommendation for multi-year small increases aligned with the 3% proposal.

Council members debated timing and next steps. Councilman David Winkler said he favored the 457-style plan as the fiscally balanced option but acknowledged the council must make a decision and expressed willingness to move the discussion to the council’s next meeting. Councilman Matthew Trollinger and Councilman David Jenkins said they wanted more time to review the new materials that had been handed out at the meeting. Mayor Janine James Mayer asked the council whether to proceed immediately or defer; the council set a follow-up budget discussion for April 8.

Votes at a glance

- Agenda amendment and adoption: Council voted to accept the meeting agenda with removal of item 3.36 (voice vote; motion carried). Motion text: “I make a motion to accept the agenda as presented with the exception of removing 3.36 of planning.” Mover/second: not specified in the record. Outcome: approved (voice vote).

- Approval of minutes and closed-session closing statements from March 18: Motion to accept minutes and closing statements carried (voice vote). Motion text: “We accept the approval of minutes and closing statements for March 18…” Mover/second: not specified in the record. Outcome: approved (voice vote).

- Resolution 25-05, amendment of calendar of events for preparation and adoption of FY2026 budget: Council voted to adopt Resolution 25-05 to move calendar dates for the budget process (motion made and seconded; voice vote; motion carries). Motion text as read into the record: “Resolution 25-05, amendment of calendar of events for the preparation and adoption of the Town of La Plata financial plan budget for fiscal year 2026.” Mover/second: not specified in the record. Outcome: adopted (voice vote).

What was not decided: The council did not adopt the FY2026 budget that night. Council members and staff agreed to continue the discussion at the April 8 meeting so members could review the committee’s written material and the three budget scenarios.

Context and next steps: Finance committee members urged the council to rely on established retirement providers rather than creating a town-run pension trust, and suggested using some implementation funds for employee financial-literacy programs. Staff will continue to refine enterprise fund modeling (including EDU/allocation work cited in the Baker Tilly draft) and present updated numbers for the April 8 deliberations. The amended calendar gives the council additional time to post materials and hold the public hearing required before final adoption; staff noted the final adoption must meet the statutory posting/adoption timeline for the town.

Ending

Council members said they appreciated the committee volunteers’ work and the treasurer’s rapid turnaround on budget scenarios. The council will pick up the budget discussion at the next scheduled meeting, with staff and the finance committee providing any supplemental materials in advance where possible.