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Pontiac retirement board, council and mayor disagree on scope and cost of $400 monthly supplement
Summary
City retirement trustees and the Pontiac City Council discussed whether a previously negotiated $400 monthly supplement for retirees could be paid without risking the pension system; actuarial figures and competing interpretations of the settlement agreement were central to the debate.
Sheldon Albritton, chair of the General Employees Retirement System (GERS), told the Pontiac City Council on Feb. 18 that the board’s primary duty is to keep the pension fund solvent and that GERS is not at the negotiating table over a promised $400 monthly supplemental benefit.
That distinction set the tone for a 90-minute briefing and discussion in which trustees, the board’s actuary and council members reviewed earlier settlement terms, current fund balances and the estimated cost of paying $400 per month to all plan recipients.
The GERS chair, Sheldon Albritton, said the retirement system “manage[s] and oversee[s] the allocation and the money for the retirees. The city and CPIR are the ones that’s in negotiation about the $400.” He told the council the fund is well‑capitalized but warned that repeated draws on reserves increase long‑term risk: “If you continually pull at that and just pulling money out of there, at some point, we won't be so well funded.”
The actuary, Louise Gates, summarized the board’s cost estimate: “The value of lifetime payments of $400 to plan members, I think we estimated the cost to be about 49 to $50,000,000 in total,” and said a rough annual running cost would be about $5,000,000 if $400 were paid to all current recipients.
Council members and the mayor pressed for clarity on who would be eligible. Council Pro Tem Carrington asked whether the actuary’s estimate included beneficiaries; Gates replied that surviving spouses and children were counted as plan members for valuation purposes. The administration and the mayor stressed a narrower reading of the original settlement: the mayor said the city’s position was that the $400 was intended for plan retirees, not beneficiaries, and that earlier settlement language had been interpreted differently over time.
Council members repeatedly asked for a meeting of the key parties — the city, GERS trustees and representatives of the retirees group — to cut through years of back-and-forth. The GERS chair expressed support for a trilateral meeting: “I'm all in,” he said, but emphasized that GERS cannot sit at a negotiation table that would threaten solvency.
Why it matters: Pension funding decisions affect retirees’ monthly incomes, the city’s future fiscal obligations and potential tax impacts if the fund becomes underfunded. The council requested the actuary’s detailed studies and a three‑way meeting to pursue a negotiated resolution.
What the council and trustees said next: Council leadership said it will press to schedule a meeting quickly and requested the board’s actuarial studies previously provided to the city. GERS members and the city agreed to pursue written materials and a defined meeting date in the “days and weeks” ahead.
Ending note: Trustees asked that any negotiated outcome include actuarial analysis before council action so the city and the board can evaluate long‑term risk to the pension fund and confirm whether the $400 supplement can be sustained without jeopardizing monthly benefit payments.
