HAVERHILL — About 1,000 retired city workers will get $30 from the city in the fiscal year that begins July 1 — the result of a compromise to a long-running stalemate between Mayor James Fiorentini and the Haverhill Retirement Board.
The retirees will also get another $45 in fiscal year 2016, according to an agreement approved by City Council last night.
For more than two years, Fiorentini has held off a proposal by the board to increase pension payments to retirees by raising the maximum base amount on which annual 3 percent cost-of-living pay increases would apply.
The board wanted to increase the base amount, which is $12,000, by $1,000 per year for three consecutive years. Increasing the base amount by $1,000 would give retirees an extra $2.50 per month, or about $30 more in the first year, in their checks.
But, according to city officials, raising the cost of living base for retirees by $1,000 would cost the city $178,000, mainly because the increase would be permanent and compound annually. Raising the base by $1,000 in three consecutive years would cost $580,000, city officials said.
Councilors showed signs recently of backing the board’s proposal, prompting a new compromise by the mayor at last night’s City Council meeting.
He offered to give the retirement board an extra $30,000 in the city’s next appropriation to the board. The board would then use that money to give all retirees checks for $30 sometime in the fiscal year that starts July 1.
In the following year, the payment to retirees would increase to $45, which would cost the city about $45,000, according to the mayor’s proposal. The mayor’s proposal does not increase the COLA base, however.
The payments would end in 2016 unless the city’s mayor and a future council agree to continue them.
The council approved the mayor’s compromise proposal 7 to 0. Councilor William Ryan abstained from voting because he is a member of the city’s retirement system, and Councilor Mary Ellen Daly O’Brien did not attend the meeting.