Preston fight over retirement fund request continues
Preston — A controversy over a request by seven nonunion school employees to join the town retirement system could end up in a legal challenge no matter what action the Board of Selectmen takes when it discusses the issue next week.
The Board of Finance voted 5-1 Wednesday against any town appropriation covering contributions for past years of service for the employees to join the Municipal Employees Retirement System, or MERS, which currently serves 20 town and library employees. The prior years’ contribution by the town would total $780,000 over 30 years, an amount
the finance board considered to be a town appropriation.
With the negative vote, Board of Finance Chairman Norman Gauthier argued Thursday, it would be illegal for the Board of Selectmen to schedule a town meeting and referendum on the issue, as requested by the Board of Education in June.
The issue was referred to the finance board last week only after Gauthier presented the Board of Selectmen with a draft court filing that would have sought an injunction to halt any scheduled town meeting on the issue.
First Selectman Robert Congdon is not participating in the discussion, because his wife is among the seven school employees seeking to join the retirement system.
Selectmen Michael Sinko and Lynwood Crary had planned to schedule the town meeting on the position that the request at this point was only to allow the employees to join MERS, not to pay for contributions for past years of service.
Selectmen reluctantly demurred, however, in the face of the lawsuit threat.
On Thursday, Sinko said the board at its Sept. 14 meeting would again consider scheduling a town meeting on the issue and will review the finance board’s vote and position on the issue.
At the same time, the school employees are persisting in their request that the issue be brought to voters at a town meeting. Gloria Homski, one of the seven employees, said the group will wait to see what action selectmen take at the Sept. 14 meeting before deciding on future action, which could include filing a fair labor practices complaint against the town.
“We certainly don’t want to see it end,” she said of the two-year effort to join the town retirement system.
Currently, the seven employees have 403 (b) individual retirement funds. Homski said the seven employees negotiated a detailed transition with the Board of Education that would call for the employees to pay a total of $255,000 into the MERS fund up front, with that total including the employees’ portion of buy-back for past years of service for MERS, all contributions the school board made to the employees’ 403 (b) accounts in past years, plus interest on the board’s past 403 (b) contributions.
There would be no further school board contributions made to the individual 403 (b) accounts.
The proposal would mean the Board of Education would not incur any costs for the MERS contributions until the 2019-20 budget year, and then would pay $64,000 per year for the 11 percent employer contribution for the enrollees, Homski said.