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Tuscaloosa finance committee briefed on $265 million projected RSA shortfall and conversion timeline
Summary
City staff told the finance committee the planned conversion of municipal police and fire pensions to the Employees Retirement System of Alabama (RSA) would increase the city——s reported unfunded liability to about $265 million and require roughly $10.6 million in new general-fund dollars in the first year; staff recommended a resolution be placed on the council agenda next week to conform to RSA rules.
At a finance committee meeting, staff detailed financial and operational impacts of converting the city——s police and firefighter pension plans into the Employees Retirement System of Alabama (RSA), saying the combined projected unfunded liability after conversion would be about $265 million.
"The city of Tuscaloosa in RSA is projected at about $54 million. The current police and fire . . . plan will be total when it gets to RSA underfunded by $210 million. So combining those two together, we are going to be sitting at $265 million underfunded," staff member Miss Sanders said during the presentation.
Why it matters: staff said the conversion will raise the employer contribution requirement to RSA in year one to an estimated $23.88 million. After accounting for amounts the city already budgets for state, police and fire pensions, Miss Sanders said the city faces about $10.6 million in new general-fund spending in fiscal 2027.
Miss Sanders outlined the assumptions and…
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