Colorado Springs, CO -- Retirement benefits for firefighters could start costing Colorado Springs millions of dollars. The fire department had extra money in its pension fund two years ago.
Firefighters were given the option to begin receiving retirement checks when they turn 50 years old, even if they are still working. At the time the decision was made, there was enough money to cover it.
Now Colorado Springs could come up more than $5 million short and have to pay for the plan out of its general fund. City finance staff asked the City Council to renege on the new pension plan, but the request was turned down.
"We felt we made an obligation, a commitment last year to the firefighters," Mayor Lionel Rivera said. "We need to at least support the compromise plan."
That proposed compromise would have the firefighters paying an extra 1 percent into the pension plan, even if they do not plan to retire early. The city would cover the rest of the deficit.
"We're talking about a shortfall of about $180,000 a year, out of a budget of more than $200 million a year," City Councilwoman Margaret Radford said.
That shortfall is only a worst-case scenario; it assumes every eligible firefighter would choose early retirement. Studies show many firefighters continue working beyond retirement age and would not want to pay for the compromise.