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Commerce City staff brief council on FOP retirement options; executive session planned before bargaining
Summary
City staff and HR presented options comparing the current MissionSquare 401(a) plan with the Fire & Police Pension Association (FPPA) defined-benefit pension; 88% of union members favored offering FPPA as an option and council scheduled an April 7 executive session to set bargaining guidance.
Commerce City’s human resources director and consultants briefed council on retirement-plan options for the Fraternal Order of Police (FOP) bargaining unit, including the city’s current defined-contribution plan (MissionSquare 401(a)) and a defined-benefit pension administered by the Fire & Police Pension Association (FPPA).
Veil Levante, director of human resources, said the city and the union jointly commissioned the actuarial adviser HIAS Group to present neutral, factual comparisons of the two models. The FOP membership subsequently voted and 88% of responding members favored offering the FPPA option to the bargaining unit, Levante said.
Key differences discussed: - Defined contribution (current MissionSquare 401(a)): employee contribution 10% of salary and city contribution 10% (total ~20%). Employees control investment choices and can take loans from their account; 29 FOP members currently have loans from MissionSquare (average loan approx. $20,750), staff said. - Defined benefit (FPPA): program design includes mandatory contribution splits (FPPA sets contribution rates); the pension provides a lifetime monthly benefit calculated using actuarial formulas (salary, service, age). FPPA requires five years in the system for vesting; FPPA does not permit participant loans.
Levante told council that, under the proposed approach, current employees would be allowed to choose whether to join FPPA (and could use MissionSquare balances to purchase service credit subject to actuarial rules); new hires after a council-authorized change would be required to join FPPA if the council directs it. Any city decision to offer an FPPA option would require a council resolution before bargaining and potentially additional administrative work in finance and HR.
Financial and implementation notes in the briefing: - The presentation noted the city contribution to the current plan (calendar-year figure cited in the presentation was $1,145,000) and flagged that FPPA contribution rates can change and are set by FPPA actuaries and trustees; the city and employees must meet those rates if they adopt FPPA. - Staff emphasized administrative implications (GASB reporting, auditing, benefit administration) and that once a unit joins FPPA it is generally a one-way change for the employer; the agency cannot later withdraw the bargaining unit from FPPA.
Council agreed to an executive session on April 7 to receive advice and finalize bargaining posture ahead of collective bargaining in May. Levante said staff would provide additional financial detail in that closed session, including FPPA’s funded status and updated actuarial estimates.
