News

F’ville Council OK’s fattened early retirement package

Tue, 12/09/2008 - 4:54pm
By: Ben Nelms

[Resident disputes wisdom of F’ville early retirement plan — See Letters.]

Eligible city of Fayetteville employees who want to do so can opt for voluntary early retirement under a plan and ordinance adopted by the city council Dec. 4. The plan could provide as much as $77,505 in the first year if all 13 eligible employees take the deal.

A breakdown of the plan shows it to be available to all employees aged 55 and up with at least 10 years of continuous service with the city, according to City Manager Joe Morton.

Those who elect to participate will receive their full retirement benefit based on the normal retirement age of 62.

The voluntary retirement plan includes a one-time incentive bonus of $1,000 for each year of service, Morton said.

Additionally, though at their own expense, retirees can continue on the city’s health, dental, vision and life insurance policies.

Morton said the city has 13 employees that meet eligibility requirements.

The city stands to save $77,505 during the first year if all 13 elect to participate, he said.

Those savings would be realized because new employees are not eligible to participate for the first year of service so the city would not have to pay into the program for them, Morton said.

The cost savings does not include savings in salary and benefits from positions that would not be filled immediately or from filling positions at a lower salary level, said Morton.

The retirement window opened Dec. 5 and will continue through Jan. 23, 2009. Employees electing to participate could withdraw no later than Jan. 30. The retirement date would be effective Jan. 31.

Morton said the city’s defined benefits pension program is 100 percent funded, noting that it is intended to be one that provides perhaps up to 50 percent of salary after 30 years.

An actuarial cost analysis for the program was performed by Georgia Municipal Employee Benefit System.

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Fayettevilles 13 too many people?
Submitted by Bonkers on Wed, 12/10/2008 - 1:25pm.

If they have 13 they don't need, then cut-back and let 13 go!

If they intend to replace them, I don't see much advantage there.

Maybe it is the fact that they can charge the retirement income to someone else and the new employees will make less money?

Sounds real fishy to me!

Is this the same bunch who wants a guaranteed income after 30 years for their employees? At no cost, or little, to the employee?

Well lets see, go to work at 18--retire at 48 and start another triple dip by getting a job from government friends--Social Security being the third dip!

I have nothing against a retirement that the employee helps pay for (1/2 at least) and at no earlier than 62! Unless incompetent at that point or earlier.

They are not paid meager wages anymore if any good.

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The math does not add up
sniffles5's picture
Submitted by sniffles5 on Wed, 12/10/2008 - 6:40am.

This is an exceptionally poorly written article. I've read it through four times now and it just doesn't make sense.

I fail to see how the math adds up here. To wit:

  • Fayetteville has 13 employees with at LEAST 10 years of service.
  • The city is dangling an additional incentive of $1000 per year of service for these folks to retire early
  • When I was in school, 13 * 10 * 1000 = $130,000
  • $130,000 is the theoretical MINIMUM cost, if all eligible employees A) took the deal and B) had ONLY 10 years of service
  • When I was in school, $130,000 was greater than $77,505

Is this $130,000 to be paid when the eligible retiree turns 62 or upon termination? The article is not clear.

Ben Nelms does his readers a disservice by using weasel words in phrases such as "The plan could provide as much as $77,505 in the first year...". Provide WHO? Is "provide" a bureaucratic synonym for "cost" now? How was this $75,505 "saving" arrived at?

Fundamental changes are being made at various levels of government, changes that could have an adverse impact on citizens' bank accounts. The Citizen, in my opinion, owes its readers better reporting than the above twaddle, which in all honesty appears to be a reworded press release masquerading as hard news.


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Government Math
Submitted by localyocal on Wed, 12/10/2008 - 10:28am.

Sniffle I agree with the reworded press release.

One can only guess that the savings would be in not having to pay the released employees salary and benefits after the retirement date until they reach 62 years of age. On of the biggest flaws in this system is not knowing what age the 13 employees are. If the average age is 55 or 56 we don't pay benefits for 6 or 7 years. If most become eligible within 2 years it only saves money for a year or so. When the retired employees start collecting by then the city has replaced that employee with 1 or 2 more staff we pay all of them plus bonus.

The good news is the city will be hiring so we can all line up to get our retirement package Smiling

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