SECTION 1. The city of Worcester is hereby authorized to issue, at one time or from time to time, bonds or notes for the purpose of funding the unfunded pension liability, so-called, of the retirement system of said city. The proceeds of any such issuance shall be transferred by said city to said retirement system. The term of any such bond or note shall not exceed 30 years from the date of issuance and the amount of any such bond or note shall be considered as outside the limit of indebtedness prescribed in section 10 of chapter 44 of the General Laws. No such bonds or notes shall be issued without the approval of the city council of a loan order adopted by a two-thirds vote upon a recommendation of the city manager. After the city council has approved the loan order, the city manager shall submit said order and a plan demonstrating how the city will finance and allocate the debt service associated with said bonds or notes to the executive office for administration and finance, and no bonds or notes authorized by this act shall be issued until the secretary for administration and finance has approved said plan. Except as otherwise provided herein such bonds or notes shall be subject to the provisions of said chapter 44.
SECTION 2. The aggregate principal amount of the bonds or notes issued under authority hereof shall not be greater than the amount sufficient to extinguish the unfunded pension liability of the retirement system of the city of Worcester as determined in accordance with this section. The retirement board of said city shall first determine the amount sufficient to extinguish the unfunded pension liability of the retirement system of said city in accordance with the report of a nationally recognized independent consulting firm, which may be the consulting actuary generally retained by said retirement board, and with the approval of the public employee retirement administration commission. Such report shall also set forth the present value savings to the city reasonably expected to be achieved as a result of the issuance of such bonds or notes and shall be transmitted to the city council prior to final passage of any order authorizing the issuance of bonds or notes hereunder. In making the initial recommendation to the city council to adopt a loan order authorizing the issuance of bonds or notes under authority of this act the city manager of said city shall indicate his approval of the aggregate principal amount of the bonds or notes as determined by said retirement board.
SECTION 3. The maturities of such bonds or notes shall be scheduled such that the annual combined payments of principal and interest for each issue shall be as nearly equal as practicable in the opinion of the city manager; provided, however, that the maturities of such bonds or notes may be scheduled so as to provide a more rapid amortization of principal.
SECTION 4. Every governmental unit the employees of which are members of the retirement system of the city of Worcester shall be responsible in accordance with this section for paying such proportion of the annual debt service expense paid by said city for bonds issued under authority of this act as is equal to the proportion of the total unfunded pension liability of said retirement system allocated to such member under section 2. Notwithstanding the provisions of any general or special law to the contrary, the public employee retirement administration commission shall increase the annual amount to be certified under section 22 of chapter 32 of the General Laws as the amount necessary to be paid by each governmental unit in said retirement system other than said city by each such governmental unit's proportionate share of the annual debt service expense as determined herein and shall decrease the amount to be paid by said city by an equal amount. Said city shall have the same legal rights and authority as the retirement board of said city to collect any amount so assessed by the retirement board to any such governmental unit.
SECTION 5. This act shall take effect upon its passage.