In the address section of the envelope and in the heading at the top of the letter, address it to "Councilman Joe Smith", but in the salutation you should write it as "Dear Mr. Smith". This applies to retired councilmen as well as those that are still in office.
You can address a retired colonel as "Colonel (Last Name)" and his wife as "Mrs. (Last Name)" or "Colonel (Last Name) and Mrs. (Last Name)" in the salutation of a letter.
Captain and Mrs.....
Use the military rank.
Councilman or Councilwoman Smith.
The Rt. Revd. Bishop A.B. Smith
When you have something to say about the policies in your area, then one person you might consider contacting is your councilman. Your city council is in charge of governing your area, as well as setting up rules and laws and making decisions about what is best for your city. If your councilman does not seem to be making decisions in your best interest -- or if you would like to point out an issue of importance that your councilman should be focusing on -- a letter is the perfect format.
Undersheriff sir
Jim (Jane) Colonel Sir (Ma'am) or Mr/Mrs. Jim/Jane Doe, Col, USAF Retired
According to the Protocol School of Washington, you should address your letter to him on the envelope (let's call him Smith for a moment) "Rear Admiral and Mrs. Peter J. Smith". In the letter itself, you drop the 'rear' and address him only as 'Admiral'. You don't add 'ret.' on the envelope - and certainly not in the letter because indication of his 'retired' status is only used in official correspondence.
You can address a retired state senator as "Senator [Last Name]" and his wife as "Mrs. [Last Name]" or "Senator [Last Name]." If they no longer hold their titles, you can address them by their first names in a formal setting.
You must remember that even though he is retired that he is still a bishop and a priest. Ordination ispermanent and therefor retired or not he deserves the title and respect of his position. It might be the case though that he wants to be called by a different title in which case it would be best to oblige.
You can address a retired doctor and his wife as "Dr. and Mrs. (Last Name)" when speaking to them formally. If you are on more familiar terms, you could simply address them by their first names.