Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Pensions topic
No spam. Unsubscribe anytime.
Actuary: Warwick's pension funded ratios improved; OPEB requires sustained contributions
Summary
GRS actuary Joe Newton told the council that pension-funded ratios rose in FY25 and unfunded liabilities declined, but warned that the newly funded OPEB trust will require sustained annual contributions (city share ~ $10M to accelerate full funding) and a multi-year strategy to work.
An outside actuary told the Warwick City Council that pension funding improved in fiscal 2025 but that the city's post-employment benefits trust (OPEB) needs continued, disciplined contributions to reach actuarial targets.
Joe Newton of GRS presented results through the June 30, 2025 valuation year and said the four pension plans generally saw declines in unfunded actuarial accrued liability and increases in funded ratios. "The unfunded actuarial accrued liability looks and walks and talks a lot like a debt," Newton said, and noted investment returns and contribution strategies drove much of this year's improvement.
Newton described the funding strategy used across plans: layered amortization for open plans and a steady maintenance approach for the closed police/fire tier. He said the newly established OPEB trust is beginning to accumulate assets but remains small relative to liabilities; he cited roughly $5.7 million currently set aside in the OPEB trust and said an additional combined 12—15 million per year (about $10 million of that coming from the city) would be needed to accelerate full actuarial funding if the council wished to move faster than the current multi-decade plan.
Council members and members of the public pressed Newton on the affordability of those contributions given other budget pressures (school construction, ongoing municipal expenses). Newton said his modeling assumes a 6.9% return assumption and that the proposed 2.5% year-over-year growth in OPEB-related budget contributions is intended to stabilize costs and reduce long-term interest expense. He offered to provide follow-up stress tests and multi-year forecasts to help the council assess trade-offs.
Why it matters: Changes to contribution policy and multi-year budgeting can materially affect property-tax levies and the city's long-term fiscal health; the council requested additional detail and a possible five-year forecast to evaluate affordability before committing to higher annual contributions.
(Reporting note: All figures and characterizations come from Joe Newton's presentation and the council's recorded questions.)
