Richmond City Council Informal Meeting - March 11, 2026

This informal meeting of the Richmond City Council on March 11, 2026, focused on the docket review of consent and regular agenda items, followed by a detailed presentation and discussion on the annual update of the Richmond Retirement System (RRS). Council members engaged in extensive questioning about the funded status, investment performance, and the possibility of a cost-of-living adjustment (COLA) for retirees. No votes were taken during the meeting, but several requests for information were made.

Consent Calendar

• The consent agenda included 14 items (ordinances 2025-258 through 2026-050). Several items were noted for amendments or continuations: Ordinance 2025-258 and 2026-042 were scheduled to be amended and continued to the March 23, 2026 council meeting. Ordinance 2026-003 was continued to March 23, 2026 per the patron's request. Items 2025-270 and 2026-019 were retained on the consent agenda after amendments at the February 23, 2026 meeting. Items 10-14 (2026-046 to 050) had committee referral waived and were retained.
• Councilman Breton questioned item 12 (ordinance 2026-048) regarding a lease renewal for Under Crown Kitchen. Parks and Recreation Director Chris Frelke explained it was a five-year lease renewal, a positive partnership, and that the lease was set to expire on March 12, 2026, adding urgency. After discussion, Breton agreed to keep it on the consent agenda.

Discussion Items

• Richmond Retirement System (RRS) Annual Update: Leo Griffin, Executive Director of RRS, and Kia Johnson, Senior Deputy Director, presented the update. Key points:
  • Investment returns (net of fees) as of June 30, 2025: one-year return of 10.5%, exceeding the assumed rate of return of 7%. Five-year annualized return of 8.2%. Portfolio outperformed its benchmark by 20 basis points in the last fiscal year, and by 80 basis points annualized since a 2020 restructuring.
  • Funded status as of June 30, 2025: 84.9%, up from 80.9% in fiscal year 2024. The net pension liability was $157 million, down from $193 million in 2024.
  • Membership composition: 4,051 retirees, 1,055 active defined benefit plan members, and about 1,700 vested terminated members.
  • Projected funded status shows reaching near 100% by 2034. Employer contributions are projected to decline from approximately $39 million in FY2027 to about $15 million by 2033.
  • The increase in funded status from 2023-2024 was largely attributed to the issuance of pension obligation bonds (POBs) by the city, which injected $120 million into the plan, plus good investment returns.

Key Outcomes

• Councilmember Trammell expressed strong dissatisfaction with the lack of a COLA for retirees, noting that the last ad hoc COLA was 1% on January 1, 2020, and the last bonus (supplement) was $300 flat in August 2024. She argued that retirees are struggling with rising costs and called for more action. She requested:
  • The specific amount retirees received from the $300 bonus after taxes.
  • The exact increase in the city's actuarially determined contribution (ADC) if a 1% COLA were granted without pre-funding.
• Councilmember Robertson asked about the cost of the pension obligation bonds (interest rates) and requested that information from the finance department.
• Vice President Jordan asked about the possibility of a targeted COLA for lower-income retirees and questioned why the plan could not accept a slightly lower funded status (e.g., 85%) to provide a COLA. The actuaries (Dan Homan and Bill Reed from Sage View Consulting) explained that granting an unfunded COLA would reduce the funded status and increase the ADC, and that there is no single correct funded percentage for granting a COLA. They noted that the 85% threshold was a prior board decision.
• Councilmember Hamilton asked how often Richmond retirees get COLA compared to VRS participants (e.g., Henrico, Chesterfield). Griffin stated that VRS provides annual COLA up to a maximum, which is pre-funded, while RRS uses ad hoc COLAs.
• Councilmember Breton inquired about the relationship between plan assets, liabilities, and employer contributions. He clarified that the POBs are repaid by the city's general fund, not from plan assets, and that the plan does not pay bondholders.
• The RRS representatives committed to providing the requested information on the cost of a 1% COLA and the net bonus amounts as soon as possible.

Adjournment

The meeting was adjourned after the RRS presentation and questions.