Finance Committee - 4/4/2018 Page 7
the present? For GM Pension, they might go out business, there might come a day when they have to pay
everything with nothing else coming in. That’s very unlikely if the United States continues as a country that is
very unlikely ever to occur, that New Hampshire would go out of existence or something like that. And if you
ask them, it’s not like they have nothing in the bank. They have $7.5 billion dollars. | think it is correct to say
that they have enough with no further contribution to pay about 10 years of benefits. So even if no one ever
paid anything else in, they could still carry on for 10 years. So that just shows you, it’s not like they are near
the edge or something like that.
When this requires such a severe sacrifice, nearly 10% of the City Budget is going into this, we are paying
higher taxes, we are giving up improvements in education and other services as well all to meet this goal of
100% when we know as a fact the day is never going to come when they really need to pay out all the benefits
because there always be more money coming in. Having been at the legislature a number of times on this and
some bills combined with the State’s decision that they are no longer to meet their obligation to pay 35% of
municipal pension costs, it’s very frustrating to try and deal with the issue. The legislators who are mostly in
control with the committee heads, David Hess’ committee, | forget what the name of the committee is right
now, but they are not that sympathetic to the municipal plight. They are mostly focused on this 100% goal,
kind of an abstraction really.
In fairness to them there is pressure from the financial industry, these accounting standards, the rating
agencies, to move to 100%. So they are under pressure but still for those who pay the bills, it's not a
comfortable situation.
Alderman O’Brien
Thank you Mr. Mayor. Mr. Mayor, | first would like to say | think you gave a very fair and accurate description
of what is going on. But my question is, just making us going to 2039 at 100% the wizards of Concord also cut
back on a lot of benefits, so newer people that are into the pension system aren’t getting the same benefits.
Nashua has a fairly good attrition rate as people have their careers and move on. Can we see something in
the future, some relief because of those changes or what they enacted up in Concord probably will give us no
relief at all.
Mr. McIntire
That’s a tough question for me to answer and | can see Mr. Alderman you are on Page 130, that for the
fluctuation from June 30, 2016 where the percent being funded is down to 58% is remembering that is
measured as of June 30, 2016. It is widely expected and | think the report just came out a couple of weeks
ago what your liability will be in June 2018. | suspect, given investment returns, that percentage comes back
up again. As the independent auditor to opine on whether or not your financial statements are in according
with Generally Accepted Accounting Principles | usually stay away from — thank you — you look like you might
be in agreement with me being ok.
Alderman O’Brien
| think | understand sir. Thank you.
Mayor Donchess
And they did reduce, there’s a two tier benefit program for City employees, particularly in Group 2. People
after a certain date, 2010 or something around then, they do not have the same level of pension benefits as
those already in the system.
