A committee studying a defined benefits pension plan for Fayette County employees is recommending that all the plan proposals be rejected so it can continue looking at “multi-employer plan options.”

That marks a sharp reversal for the controversial pension proposal originally favored by a majority of the current county commission.

The recommendation will be discussed, and perhaps voted on, by the commission at its workshop meeting Wednesday afternoon at 3:30.

The pension plan concept has come under fire by some county residents who claim it would cost the county a significant amount of money in the future.

County officials have said switching from the current retirement plan would actually save the county $550,000 a year because it would lower the obligation the county would pay for each employee’s retirement. Employees would be required to contribute 2.5 percent of their salary to the plan, officials have said.

“The committee has taken very seriously the charge from the Board of Commissioners to critically evaluate the various proposals and to recommend a provider which is best suited to serve both our dedicated county employees as well as one which is responsible to our governing body and to the citizens they represent,” the committee’s memo said.

The recommendation to scrap all proposals submitted by vendors was unanimous among the committee, which consists of senior staff members.

Pensions are generally structured to provide a lifetime benefit based on a certain percentage of an employee’s salary at their retirement. That percentage is also based on an employee’s total years of service.

Under Fayette’s proposal, an employee will receive a monthly pension equal to 1.5 percent of their monthly salary multiplied by the number of years worked for the county with a maximum total of 45 percent. There is also no cost of living provision in the pension plan.

The county’s proposal would give no credit for prior years of service but instead employees would earn their service credit starting from the time the plan is implemented.

According to county officials, other details of the defined benefits plan include:

• Full vesting after five full years of employment with the county ... if the employee doesn’t make it five years they forfeit the rights to any retirement benefit; and retirement eligibility is reached at 65 years old;

• The monthly retirement benefit is equal to 1.5 percent of their salary for each year of county service with a maximum of 30 years;

• The maximum retirement benefit is 45 percent of an employee’s pre-retirement salary;

• The county will only be contributing 3.8 percent of salaries to the defined benefits plan as opposed to 4 percent under the current retirement plan structure;

• If for some reason the county’s contribution to the defined benefits plan increases, the county will reduce by that amount the contributions to the defined contribution plan that will remain; and

• The funds are required to be audited annually.