Retirement fund costs City of Chattanooga additional millions

BY THE NUMBERS• $13.4 million: Revised annual cost for post-retirement benefits.• $8.7 million: Amount city budgeted in 2010-11 general fund for post-retirement benefits.• $11.7 million: Amount city now expects to pay from general fund for benefits.Source: Chattanooga

A trust fund set up to help pay city employees' benefits after they retire will cost taxpayers $2.5 million to $3 million more per year than the initial estimate of $9 million, the city's chief financial officer said.

"It's a budget problem I didn't anticipate originally," Daisy Madison said.

City officials said they have money to plug the hole this year, but future years could be a problem.

Last year, the City Council agreed to fund fully the post-retirement plan, which allows retirees to stay on the city's medical plan, at $14 million. The initial estimate was almost $15.5