City approves money-saving employee retirement options
Some city employees gearing up for retirement will now have two more options to pull from the hats they're ready to hang up.
At the city council meeting Tuesday, the council approved the establishment of the Phased Retirement Option and the Early Retirement Incentive, which is estimated to effect around six chosen employees.
The Phased Retirement Option will be offered to a city employee with a particular value, such as extensive experience in a vital area, the option to retire, with the city then re-hiring them back on a part-time basis.
They have to be at least 62 years old and meet other retirement requirements established by the Public Employees Retirement Association.
The employee could not work over 50 percent of his or her former work hours or more than 1,040 hours a year.
"We get the benefit of an experienced employee from which we can still draw the experience and knowledge from, and the employee then gets the benefits of additional income while still being able to draw their pension," said City Administrator Bob Louiseau.
The second option is the Early Retirement Option, in which an employee who is still a few years out from retirement (typically the 55 to 56 year old range) can retire early, as the city pays them $750 a month for health insurance costs.
These employees would take a permanent reduction in retirement and loss of benefits, so city's money would help offset that lost money.
Louiseau says this option will mainly be given to public safety employees.
"The intent would be that these employees would not be replaced for three to five years, while younger employees already working for the city would step up into those positions," said Louiseau.
This would save the city between $55,000 and $62,000 a year.
Proponents of the options (all except one of the council members were in favor) say this would give employees who are ready to leave an early out while ensuring looming budget cuts wouldn't force the city to eliminate positions; thereby having to cut the employees with the least seniority.
"This would give us an option to keep those younger employees who we have already invested in for training, certifications and licenses," Louiseau said.
Voting against the Early Retirement Option was City Councilman G.L. Tucker, who was concerned with the fact that the city would automatically be hiring from within the organization, in effect eliminating the pool of possible applicants.
"I'm not saying we shouldn't make cuts, but philosophically I disagree with this approach," Tucker said.
Louiseau says the council knows there is a trade off in these options, but believes the city has qualified employees who they will have trained well enough to step up into the higher level positions.
And with the council anticipating state budget cuts, Louiseau believes these new options are a proactive approach to dealing with city budget problems before it's already in their laps.
"We'd rather be proactive in looking at how can we do that in an organized, responsible way and try to obtain the highest level of service as possible to our residents without having to all of a sudden abruptly make changes.
"That makes for a chaotic situation."
Louiseau says with revenue short, he believes the council has to be ready to consider a whole range of options it may not otherwise consider.