FISCAL NOTE
Date Requested: January 16, 2020
Time Requested: 03:09 PM |
| Agency: |
Municipal Pensions Oversight Board |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1194 |
Introduced |
SB138 |
|
|---|
| CBD Subject: |
Counties |
|---|
|
FUND(S):
Unknown
Sources of Revenue:
Other Fund The Bill does not specify the source of funds.
Legislation creates:
Creates New Expense
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The proposed legislation would require the State to provide a ten percent matching payment of the actuarial determined municipal required contribution to the municipality's policemen's and firemen's pension funds on an annual basis for a period of 10 years. Assuming all 31 municipalities consolidated with neighboring municipalities or counties, the State's ten percent matching contributions to the policemen's and municipal firemen's pension and relief funds for FY2020 could be up to $5.25 million, as the total municipal contributions to the 53 municipal pension plans for the same period is $52.5 million.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2020
Increase/Decrease
(use"-") |
2021
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
5,239,000 |
5,605,803 |
72,385,315 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
5,239,000 |
5,605,803 |
72,385,315 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The total amount of cost to the State is difficult to calculate. The exact figure cannot be determined without knowing which municipalities will consolidate. The maximum cost for FY20 would be $5.25 million, if all municipalities consolidate.
The additional state match for 10 years could be up to $72,385,315. This estimate assumes, again, all municipalities will consolidate; it also assumes an increase of seven percent annually of the total required contribution to the municipality’s firemen’s and policemen’s pension fund. The matching payment would certainly improve the underfunded pension plans; however, this legislation does not provide a funding source for these costs.
Memorandum
This legislation does not provide a funding source for these costs.
The bill does not name which state agency will distribute the matching payments. If the Municipal Pensions Oversight Board is tasked with administering the payments, it would do so with current staff and resources.
Person submitting Fiscal Note: Michelle Painter
Email Address: michelle.t.painter@wv.gov