State comptroller warns Memphis that 'substantial challenges rem - WMC Action News 5 - Memphis, Tennessee

State comptroller warns Memphis that 'substantial challenges remain'

The comptroller says Memphis city finances are in the clear, but the comptroller warns of "substantial challenges" that require pension reform. The comptroller says Memphis city finances are in the clear, but the comptroller warns of "substantial challenges" that require pension reform.

(WMC-TV) - The city of Memphis is financially stable, but the state comptroller says the Bluff City is not out of the clear yet.

The city says if they do not reform the employee pension system, it could go bust. The unions say the city's magnifying the problem to put more of the pension burden on the employees.

"We cleaned up a lot of practices here at the city that dated back several decades," said Memphis City Finance Director Brian Collins.

The comptroller says Memphis city finances are in the clear, but the comptroller warns of "substantial challenges" that require pension reform.

"We have unfunded liability in our pension plan dating back to 2009 and in 2014. It's expected to reach $740 million," said Collins.

The city finance director says that is in addition to the retiree health plan's $1.3 billion unfunded liability.

"Trying to get out of the obligation of having to pay public employees what they deserve," said Memphis Police Association President Michael Williams.

Williams says it is a ruse and city leaders are deliberately swaying the comptroller.

The city has been looking at switching the pension system to a 401(k)-type model.

"We're not an outlier here. This is a problem many municipalities are facing. It's not a ruse, and we look forward to working with the employee associations," said Collins.

"We have over $2.1 billion in our pension plan. That doesn't sound like it's hurting to me, and it's gaining $30 million per month. What's the problem?" said Williams.

This is only the beginning of the debate. It could take months or years for the city and unions to come to an agreement.

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