Potential pension debt settled for St. George if incorporation passes, but questions about budget remain

Potential pension debt settled for St. George if incorporation passes, but questions about budget re

BATON ROUGE, La. (WAFB) - On Wednesday, Oct. 9, the East Baton Parish Metro Council approved an agreement to determine how St. George would pay its share of the city-parish’s pension debt if voters agree to incorporate on Election Day, Saturday, Oct. 12.

This topic has been tabled from the council’s agenda since August, with both Baton Rouge and St. George leaders not being able to agree on a plan for the share of pension debt. However, some still have concerns.

"To approve item 37 as amended. Second by Watson. Any objections? Seeing none, item 37 has been approved."

There’s now some guidance about the future of the city-parish employee pension, who will pay for it, and how, if St. George becomes a city.

“We’ve always said since the beginning that we want to pay our fair share of that pension liability. We weren’t going to leave employees behind, and this is a step in that direction,” said Andrew Murrell with the St. George incorporation effort.

EBR Chief Administrative Officer Darryl Gissel says St. George organizers should’ve been negotiating with the city-parish before they made their budget.

“Tonight shows that their [St. George] proposed budget is about $1.3 million short of part of the legacy costs. The consequence would be that taxes would have to be raised in the new proposed city should this go forward,” said Gissel.

Denise Akers with the parish’s retirement system says she has been looking at what portion of retirement debt should be given to St. George if it breaks away.

“We just wanted a fair and reasonable formula to use. We patterned this off of the way a lot of statewide systems calculate the debt when a portion of their employers break away. And with this retirement debt that we’ve calculated, just as an estimate, it’s a little over $45 million,” said Akers.

Now, this is just an estimated formula for the retirement debt only.

The ordinance says the debt won’t be calculated until two years after the incorporation, if it happens, looking at the general fund revenue for the city’s past two years. Opponents still say the proposed city’s budget falls short, but people inside the movement say the budget accounts for the pension issue and still, there will be no new taxes.

Mayor-President Sharon Weston Broome issued a statement Wednesday about the decision:

“Tonight was the first negotiation of many for unknown, outstanding legacy costs and debts for the proposed city of St. George. With only two days left before voters go to the polls, there are entirely too many unknown variables. The true cost of the legacy and pension expenses will be over $100 million. The proposed budget does not address these costs. Their plan is not workable and will result in higher taxes. That’s why St. George is risky, unverifiable, and unknown and we urge citizens to vote no this Saturday.”

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