City of Bristol, Va. on track to pay off $21 million pension plan balance
At the City of Bristol, Virginia's Feb. 7 council meeting, Councilman Doug Fleenor addressed a $21 million dollar debt the city owes to its pension plan. He questioned whether that debt was considered before the city borrowed $100 million to partially fund the Falls commercial development. "Were the pension liabilities the city owed, shown to the bond holders and so forth? And if no, why not?" Fleenor asked other council members and the city attorney. The city released its annual audit and we confirmed there is a $21 million debt owed toward the city's pension plan. News 5's Kristi O'Connor found out what this means to city employees, retirees and the taxpayers. While a $21 million debt is alarming, especially on top of the $100-million the city already owes, we found out the city is making good on its payments to the Virginia Retirement System. "I think that hiding the facts of debt from the population isn't fair," Councilman Doug Fleenor said. Fleenor says the city's financial troubles, may be much larger than they let on. He is worried about the $21-million balance the city owes to its pension plan, separate from the 100-million-dollar debt they partially owe on the Falls. "We have a covenant with those individuals that when they retire they're going to be taken care of. And I just hope that that isn't jeopardized," Fleenor said. We looked through the annual audit and confirmed there is a $21-million debt owed to the retirement fund, but Chief Financial Officer Kim Orfield tells me this is a long-term debt the city is on track to pay back. "It's not a debt that's going to be due tomorrow, or a debt that's going to be due within the next month, or next few years. It's a debt that's going to be amortized over a 30 year period," Orfield said. We confirmed with the Virginia Retirement System that the city is not on any watch list and is making its payments. So far, the city and its employees have contributed nearly $87-million to the $108 million liability. State officials say 80 percent funded is a relatively healthy place to be in. "Current employees and retirees have nothing to worry about," Orfield said. While the pension plan is not a concern, city officials continue to look for ways to increase revenue and cut the more than $100-million debt that hangs over them, about half of it borrowed for the Falls. "The way I think we're going to get out of it, is going to be painful," Fleenor said. A spokeswoman with the Virginia Retirement System says Bristol's $21-million balance is comparable to other cities of the same size.
BVU also uses VRS for its employee's pension plans, however it had a $1.7 million surplus at the end of the 2015 fiscal year.