Richmond City Council Informal Meeting - March 10, 2026

The Richmond City Council held an informal meeting on March 10, 2026, primarily to receive the annual update on the Richmond Retirement System (RRS). The meeting included a brief review of the consent agenda and a detailed presentation by RRS leadership, followed by extensive questions from council members regarding the system's funded status, potential cost-of-living adjustments (COLAs), and retiree benefits.

Consent Calendar

• Item 1 (Ordinance 2025-258): Planning commission recommended approval with an amendment; scheduled to be amended later and continued to March 23 council meeting.
• Item 2 (Ordinance 2025-270): Amended at the February 23 council meeting.
• Item 4 (Ordinance 2025-287): Continued to March 23 council meeting per patron request.
• Item 6 (Ordinance 2026-019): Amended at the February 23 council meeting.
• Item 12: Discussion about a lease renewal with a community partner; Councilmember noted the five-year term is the longest allowed, but the partner has been effective. The item was kept on the agenda due to urgency (lease expiring March 12) and no objection to proceeding without a subcommittee hearing.
• Item 15 (Audit 2025-231): Continued to April 13 council meeting.
• Item 16 (Ordinance 2026-017): Finance and Economic Development Committee recommended approval; retained on the regular agenda.

Discussion Items

• Richmond Retirement System Annual Update: Leo Griffin (Executive Director) and Kia Johnson (Senior Deputy Director) presented the annual update. Key points:

  • Investment returns (net of fees) as of June 30, 2025: 1-year return 10.5%, exceeding the assumed rate of 7%; 5-year annualized return 8.2%. The portfolio outperformed its benchmark by 20 basis points in the last fiscal year and by 80 basis points annualized over the past 4.75 years since a 2020 restructuring.
  • Funded status: 84.9% as of June 30, 2025, up from 80.9% in fiscal year 2024, primarily due to strong investment performance and a $120 million pension obligation bond infusion in June 2024. Net pension liability is $157 million.
  • Membership composition: 4,051 retirees, 1,055 active defined benefit plan members, ~1,800 active in 401(a) DC plan, ~1,700 vested terminated members.
  • Projected funded status: Expected to reach near 100% within a decade (by 2034) if the city contributes the actuarially determined contribution (ADC) and the assumed 7% return is achieved.
  • Projected employer contributions: Expected to rise to about $30 million in 2032 and then decline to about $10 million by around 2034, due to the payoff of a legacy liability amortization.

• Councilmember Questions and Discussion:

  • Councilmember Trammell raised concerns about the lack of a COLA for retirees since an ad hoc 1% COLA in January 2020. She criticized the RRS board for not recommending a COLA despite the funded status improving to 84.9%, and noted that retirees are struggling with rising costs. She asked at what funded level a COLA would be recommended and requested data on the last bonus (supplement) given to retirees.
  • Actuary Dan Homan (SageView) stated there is no correct funded percentage for issuing a COLA; pre-funding a 1% COLA costs $6.6 million upfront, and a 3% COLA would cost about $20 million. He noted that granting an unfunded COLA would lower the funded status and increase future ADC.
  • Councilmember Bracken clarified the relationship between funded status, assets, liabilities, and the ADC. He asked about the pension obligation bonds; Mr. Griffin deferred to finance on bond payments but confirmed that the bonds were a substitution of debt and the city likely benefits from arbitrage.
  • Vice President Jared asked about the median funded status for municipal plans (around 77.7% for state plans) and whether a lower funded status could be accepted to provide a COLA. He also asked about targeted COLAs (e.g., for lower-income retirees). Mr. Griffin noted that targeted COLAs are possible and would reduce the cost. The actuary (Bill Reed) stated that the 85% threshold was a board decision, and that the current 84.9% is just below that; they did not recommend a COLA this year but may reconsider next year.
  • Councilmember Robertson asked about the drop in projected employer contributions between 2032 and 2033, which was explained by the payoff of the legacy liability amortization. She also asked if the funded status improvement is directly related to the shift to VRS; Mr. Griffin clarified that the pension obligation bonds were the primary driver for the 2023-2024 jump.
  • Councilmember Trammell requested the specific dollar amount of the last bonus (a $300 flat payment in August 2024) and asked for the net amount retirees received after taxes. She expressed frustration that the bonuses were inadequate.

Key Outcomes

• No formal votes or decisions were taken during the informal meeting.
• RRS committed to provide:
  1. The increase in the city's ADC required to fund a 1% COLA if not pre-funded (pay-as-you-go cost).
  2. The net amount retirees received from the $300 bonus after taxes.
• Councilmember Robertson requested details on the cost and interest rate of the pension obligation bonds from the finance department.
• The meeting adjourned after the RRS presentation.