One of the many Florida cities facing financial hardship is Titusville, FL. Recently re-elected mayor, Jim Tulley, warned his city that without a reform of city employees’ pensions and other retirement programs, the city would ultimately go bankrupt. Workers unions, particularly representing police officers and firefighters, have been reluctant to agree to any form of restructuring of their pension plans after an earlier agreement promised them a better retirement, but lower pay.
As of October 2010, Titusville’s annual financial reports showed that unfunded liability in the Police Officers and Firefighter’s Retirement Trust had reached $25 million. The unfunded liability in the General Employee’s Retirement Trust had reached $19 million; not to mention, pension costs are going up. Other forms of retirement programs are costly as well, such as health insurance. The annual financial report showed the cost of other unfunded liability for retirees to be $44 million.
Titusville’s financial director, Bridgette Clements, said the city is not at immediate risk for defaulting, but must take precautionary actions for the future. Other cities throughout the country, such as Stockton, CA, have already gone bankrupt largely due to pricy pensions and other benefits for city employees.
After six months and no progress made in the negotiations, the city declared an impasse last week with police, firefighter and general employee unions. Mediators will now come in to help determine the best plan of pension reform for the city. The mayor said that without reform, the city’s residents will endure problems on a larger scale and the quality of life will go downhill.
To read more on this story visit: http://www.floridatoday.com/article/20120819/NEWS01/308190051/Mayor-Pensions-might-bankrupt-Titusville
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