MORGANTOWN, W.Va. — The City of Morgantown appears ready to have future city firefighters and police officers placed into the state municipal pension plan.
The Morgantown City Council unanimously approved the first reading of ordinances that would move newly hired first responders to the Municipal Police Officers and Firefighters Retirement System during their regular meeting Tuesday. The ordinance was passed as part of what is being titled by city staff as “The Compromise,” which includes a combination of moving existing funds from sales tax revenue to the currently active pension funds for city police and firefighters and an increase to the city fire fee.
“We are not funding that appropriately, and our liability, our unfunded pension liability, continues to grow, year after year after year,” said Morgantown Finance Director Jonathan Furgison. “Now this has been an ongoing issue that we are now looking to solve,” he said.
Representatives of the Morgantown Police and Firefighter Pension Boards were on hand during the council’s meeting, where they expressed concerns about the move to the State Municipal Police Officers and Firefighters Retirement System. During the public portion of the meeting, representatives addressed both the actions taken by the city ahead of the decision and the move itself, which they feel has been an objective of the city for several years. Separate from their concerns over the financial and job recruitment implications of the move, pension board members listed the allocation of municipal sales tax funds towards low-interest checking accounts, changes to officer pay, and other decisions as actions that reflect a negative view of police and firefighters from city officials.
“You just take, take, take, take from your police officers and firefighters, more of the same,” said Morgantown Police Pension Fund board member Larry Hasely. “It started with taking away comp time, overtime, it’s just more of the same,” he said.
The move to the State Municipal Police Officers and Firefighters Retirement System was passed on the first reading of two separate ordinances. By the ordinance, future hires of each department will be directed to the “Optional-II Financing Method,” which requires an annual contribution from the city to be no more than six percent per year. This is considered a drastic difference in comparison to the 107 percent contribution that the city accounts for current and retired firefighters and police officers in the “Alternate Plan.” According to Furgison, this will coincide with direct financial contributions valued at around $10 million from sales tax being held by the city. The move will curb city liabilities that are already as high as $118 million.
“We’re placing it (the $10 million held by the city) immediately into both pension plans, equally, and then we’re going to allocate the sales tax, that 25 percent sales tax moving forward is going to be deposited into the investment accounts,” said Furgison.
The first reading of an ordinance that increases the city fire fee by approximately 15 percent was also passed during the meeting in response to the deficit in both city police and firefighter pension funds. The fire fee increase is expected to increase revenue by approximately $611,000 per year, all of which will go towards the active city firefighter pension funds. The funds will also be added to extra staffing and equipment allocations that are supported by the city fire fee.
“All of those expenses related to the fire department, whether that’d be in the day-to-day operating supplies, or the capital expenses, are more than what we would otherwise be collecting in the fire fees and the sales tax,” said Assistant City Manager Emily Muzzarelli on the need for the increase in fire fees.
The city hopes that the moves would not only significantly decrease long-term liabilities to the general fund but also prevent the closure of the currently active pension funds for city police and firefighters. Based on city projections, if the city maintains a six percent contribution to the State Municipal Police Officers and Firefighters Retirement System and a consistent contribution of no less than $1.2 million to the active city pension funds from sales tax, city annual liabilities would max out at no more than $2.4 million per year, with pensions fully funded by 2065 or earlier. The hope for members of Morgantown City Council is that this will be the first step towards moving past an issue that has been discussed for more than a decade.
“I’m happy that we are addressing it and we are going to take care of it,” said Councilor Dave Harshberger, who has served on the council since 2019. “To deliver on the promise to those that are currently with us and are retired, and we have a good plan for those that come on board after July 1,” he said.