$6M Early Retirement Plan Approved By Divided Fairfield RTM

FAIRFIELD, CT — After a lengthy debate Monday, the Representative Town Meeting voted by a razor-thin margin to approve a $6 million early retirement plan for town workers.

The body signed off, with 21 in favor and 19 opposed, to fund agreements for the voluntary incentive plan with unions representing the town’s public service, and professional and technical employees.

“This is a crucial part to my reorganization plan,” First Selectwoman Brenda Kupchick told the town meeting when its joint committee met Dec. 7.

Fairfield officials expect 23 workers to opt for early retirement. If that happens, the plan will create a $5.9 million liability impact over 20 years, in addition to $400,000 in lump sum payments for retirees. The net budget savings for the plan are estimated at just under $3.2 million over 10 years, although town officials made clear that because the program is voluntary, there is no way to know the exact savings in advance.

“Nothing is guaranteed in this process because there are so many variables,” Kupchick told the body at its meeting Monday.

Kupchick intends to use the early retirement plan to build a more efficient town government with better customer service, integrated technology and reorganized departments. She has also resolved to eliminate three funded positions, without reducing services.

“I have committed, no matter what, that this will be budget neutral,” she said Monday.

Town representatives questioned Kupchick both Dec. 7 and Monday about financial aspects of the plan, with Majority Leader Jill Vergara, D-District 7, repeatedly referencing a draft of the town’s comprehensive annual financial report. According to Vergara, the document said that as of June 30, 2020, the town’s pension plan had dropped year-over-year from 86 percent funded to 78 percent funded.

“Those numbers are concerning, and it reflects serious risk in my mind,” Vergara said Monday.

Vergara questioned whether the early retirement plan would further exacerbate the funding decline, and at one point introduced Board of Finance member Lori Charlton to the teleconference.

Charlton said the retirement plan would bring the funding level down to 76 percent.

“We had the pension board review this extensively and this never came up,” Kupchick said.

At the meeting, Chief Finance Officer Jared Schmitt said he did not expect the pension plan’s funding level to drop below 81 percent.

In an email Wednesday, Schmitt said the annual report draft cited by Vergara contained no actuarial analysis of assets, an essential component of determining how pensions impact a town budget. Schmitt did not provide Patch with a copy of the draft when the publication requested one Wednesday, on the grounds that the document was not finalized.

Kupchick’s administration has committed to fully funding the actuarially defined employer contribution of the pension fund — the amount the town must save annually to ensure the necessary retirement funds are available.

Representative Sharon Pistilli, D-District 3, had multiple concerns about the specifics of the retirement plan, and questioned whether the town’s savings calculations accounted for attrition or for the raises new hires who replaced retirees would receive over the years.

“The savings numbers are overestimated,” Pistilli said Dec. 7.

At the same meeting, representative Karen McCormack, R-District 2, said such statements were “beyond speculative.” Representative Marisa Ringel, R-District 10, said Monday that other members of the town meeting were “micromanaging” the first selectwoman, and urged the body to support the plan.

Kupchick agreed to update the town meeting on her progress in September.