Retired City of Birmingham employees may be getting a long-awaited boost to their monthly pension—potentially their first increase in more than two decades.
On Wednesday, the city’s pension board voted to recommend a $400 per month raise for all retired municipal workers. It’s a proposal that still needs final approval from the Birmingham City Council, but for many who’ve spent their careers in public service, it’s a hopeful step forward.
If passed, the city’s contribution to the pension fund would increase by more than $22 million in the next fiscal year. That’s in addition to the nearly $38 million already budgeted to maintain the pension system.
Pension board trustee Dexter Cunningham said the increase is modest compared to the value retirees bring to the city.
“We’re going to lobby the council and hopefully they will hopefully try and find a way to maybe not give some money to outside interest, outside of the state or outside of the city to look after the people who’ve served. So we’re talking about less than a percent increase in compensation. That’s not too much to ask,” Cunningham said.
Mayor Randall Woodfin, who serves as chair of the pension board, provided the following statement following the board’s vote to approve the recommendation:
“The city is committed to strengthening our pension and supporting our current and retired employees.This administration inherited a pension system more than seven years ago that was severely underfunded. Every year we have increased our contributions to the system and even secured legislation in Montgomery to ensure the pension fund would be adequately funded for the future.Today’s recommendation by the board would increase the city’s contribution by more than $22 million in the next fiscal year. That would be in addition to a minimum $38 million contribution from the city to maintain the pension in the upcoming budget.This comes as the city continues to work to project revenue for the upcoming operating budget. The security of the pension fund is our absolute priority for our employees and retirees. We will take a close look at what impact this recommendation will have on the pension and the budget.”
While the vote marks progress, city leaders emphasized that this increase would only apply to the upcoming fiscal year. A long-term solution for pension adjustments would still need further discussion and action.The proposal will now head to the city council for debate and a potential vote in the coming weeks.
