Town of Palm Beach Takes Steps To Increase Pension Program

The Town of Palm Beach began taking steps in the effort to increase funding for the pension program.

During a previous budget meeting in July 2017, Town of Palm Beach Town Council requested that staff locate additional funds for the underserved pension program that is currently off-slate, which is largely due to decreasing returns on investments. After the staff proposed transferring funds from the general reserve, to the retirement program for the upcoming budget year, the Town Council recommended the amount of $5 million.

Each year, the Town’s investment obligation to the retirement fund is $9.3 million. The additional $5 million will place their investment for the 2017-2018 fiscal year at $14.3 million.

On Wednesday, Finance Director Jane Struder introduced the proposed plan to generate the $5 million to Council, which included using surplus funds and budget cuts. Struder defined multiple areas for the proposed cuts; the largest amounts generating from, as follows: the general fund contingency percentage reduction, reallocating bond funds, and reducing earmarked funds for retirement health insurance. 

Town of Palm Beach Takes Steps To Increase Pension Program

The general fund contingency percentage would be cut from 1.5 to 1 percent saving $333,000. Unused bond funds totalling $302,000, would be moved from the Coastal Protection Fund into capital improvements, then distributed to the Pension Fund. Money that is contributed annually to retiree health insurance above the required amount, would also save an additional $206,000.

Other proposed cuts are in the areas of department spending on elections, Zika spraying, and lowering employee pay increase percentages from 3 to 2.5 percent.

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The proposed plan would also generate a portion of the $5 million by increasing the general fund contribution from $1 million to $3.5 million, using $117,000 tax revenue from a recent increase in taxable property values, as well as $197,000 forfeiture funds and $300,000 in budget savings. Possibly generating a total of $614,000 in additional funds.

The Town Council will hold two public hearings on budget adoption and property tax, on September 12 and September 19, which will be held in the Council Chambers at Town Hall.