Common Council is moving forward with the shared risk model recommendation from the Pension Task Force to handle the city’s pension plan. The model, in broad terms, means city employees will pay more and the city less.
But with a vote of 6-2, it wasn’t an easy decision. Deputy Mayor Shelley Rinehart and Ward 1 Councillor Bill Farren couldn’t vote due to a conflict of interest and Ward 4 Councillor Ray Strowbridge was absent.
Councillors Susan Fullerton and Donnie Snook were not in favour of the decision with Fullerton’s motion to hire another independent party to review other possible options being defeated. Fullerton argues when you’re buying a truck, you don’t just go to one dealership. Snook says for such a big decision, a second opinion would show they’ve done their due diligence.
Ward 2 Councillor John MacKenzie doesn’t mind a second opinion but after grappling with the pension for 8 years and not knowing who to use for a second opinion, he says it’d be a 10 million dollar mistake if the job isn’t done by January. MacKenzie also saying although large companies can have two pension plans, there’s provincial legislation in the province that prevents that option.
Ward 4 Councillor David Merrithew had people ask him why the city just doesn’t go bankrupt but he argues that isn’t an option if you have the ability to pay. He adds a defined contribution plan would also be 10 million dollars more expensive.
Mayor Mel Norton acknowledging it’s a tough decision, saying in the end the shared risk model will take a 195.5 million dollar deficit down to 161.1 million. He wishes there was a cheaper option but he’d like to get the pension finished and move on to fixing other problems like roads and water. He feels this is the right option with minimal risk and huge rewards.
Now, Council will draft a memorandum of understanding. A law firm will be taking directions from Council and various bargaining units to reflect a joint understanding. There will now be a “meeting of the minds” between council and bargaining units to find a solution.
