MUNICIPAL CORPORATIONS ‑- FIREMEN'S PENSION FUND ‑- TWO MILL LEVY

MUNICIPAL CORPORATIONS ‑- FIREMEN'S PENSION FUND ‑- TWO MILL LEVY.

There being no need to secure an actuary's report on the condition of the city's firemen's pension fund unless its condition appears to show no need for the mandatory levy of one mill; there would be no occasion to incur such expense of the report, hence your question would not arise.

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                                                                   May 28, 1951

Honorable Cliff Yelle
State Auditor
Olympia, Washington                                                                                              Cite as:  AGO 51-53 No. 58

Attention:  !ttA. E. Hankins, Chief Examiner,Division of Municipal Corporations

Dear Sir:

            We acknowledge receipt of your inquiry of May 22, 1951, in which you ask this office for an opinion supplementing our opinion to you of May 4, 1951, and you have specifically asked concerning the city firemen's pension fund as follows:

            "The levying of these two mills for the Firemen's Pension Fund need not be made if the actuarial examination reports the fund to be in substantial financial condition.  The question is:  'If this 2 mills is not levied for the benefit of the Firemen's Pension Fund, may it be levied for Current Expense, bringing the total city levy up to 16 mills and within the 40-Mill Limitation?'"

            Our conclusion may be stated as follows:

             [[Orig. Op. Page 2]]

            There being no need to secure an actuary's report on the condition of the city's firemen's pension fund unless its condition appears to show no need for the mandatory levy of one mill, there would be no occasion to incur such expense of the report, hence your question would not arise.

                                                                     ANALYSIS

            By section 6, chapter 91, Laws of 1947, the legislature provided as a part of its code relating to city firemen and establishing the firemen's relief and pension system, that the mandatory duty upon such cities to levy one mill each year for the firemen's pension fund, and provided further that if the estimated amount accruing to the fund during that year, including such mandatory one mill levy, was insufficient to meet the needs of the fund, a city must make a levy in addition of not to exceed one mill, in order to provide the necessary amount for said fund.  This section also provided that the additional levy may be in addition to the fifteen mill levy limit provided by law for cities.

            By section 1, chapter 72, Laws of 1951 (41.16.06 RCW [[RCW 41.24.060]]) section 6 above discussed, was amended to include a proviso that the city may appoint an actuary to examine into the condition of the fund and, if his report establishes that said mandatory one mill levy was not necessary, it could be omitted.  In our opinion of May 4, 1951 [[Opinion No. 51-53-34]], we advised that it was not necessary to retain an actuary in order to make the additional levy, but must have an actuary's report in order to omit said mandatory levy.

            The legislature in 1947 presumed that the city could estimate the amount of revenues to said fund without the need of an actuary, and could determine whether or not it was necessary to levy the additional mill.  Normally, this is obviously true and it must, therefore, follow that a city would not care to put itself to the expense of hiring an expert except in one instance in which the estimate discloses that the mandatory mill was not necessary for that year.  Accordingly, if the city desired to omit such mandatory levy, it may do so by complying with the legislative procedure and hire the actuary to verify the estimate and thus omit the levy.  By this means both the legislative purpose of protecting the firemen's pension and relief fund would be secured and the taxpayers could be relieved of the burden represented by this one mill levy.

            It thus follows that the city would never, in fact, have cause to hire the actuary nor would it be necessary to do so to determine whether to levy theadditional mill.

             [[Orig. Op. Page 3]]

            Since the need to levy the additional mill would not occur unless it appears from the estimate that the mandatory mill would be insufficient to provide the necessary moneys for the city firemen's pension fund, the simple fact results that there would never be any determination that the additional mill or any part thereof, was not necessary.  Hence, the situation under which your question was asked would never arise, and it would, therefore, appear unnecessary to decide whether or not the additional mill may be levied for general city purposes.

            Furthermore, there is not any question relative to exceeding the fifteen mill limit for cities in the event the actuary's report disclosed no need for the mandatory mill and the city desires, therefore, to levy the same for general city purposes, as that mill is always within the fifteen mill levy limit.

Very truly yours,

SMITH TROY
Attorney General

PHILIP W. RICHARDSON
Assistant Attorney General