Auditor General says Johnstown 'can't wait any longer' to address pension funds
JOHNSTOWN, Pa. - Pennsylvania Auditor General Eugene DePasquale said the latest audit of Johnstown's municipal pension plan showed little progress.
DePasquale said that Johnstown's annual employee pension funds increased by more than $334,000 in just two years as the city's minimum municipal obligation increased by $3.38 million.
“With Johnstown’s limited tax base and continued financial woes, it will be difficult to find another $334,000 to pour into the pension plans. I am concerned that the city may have to drain more money from municipal services or increase an already heavy tax burden on property owners,” DePasquale said.
Though some improvements have been made, DePasquale said three out of four pension plans remain less than 57 percent funded, with the firefighter plan only being 37 percent funded.
The auditor general said that he is concerned the city did not adopt a plan to address its distressed pension funds, and that a key issue is that 260 retirees are drawing from the pension fund when only 114 active members are contributing.
“Given the unhealthy state of the pension, city leaders must implement a long-term recovery plan as required by law,” DePasquale said. “They cannot afford to wait any longer.”
The City of Johnstown has been in distressed status since 1992 and has one of the lowest percentage pension plans in the state, according to DePasaquale.