Piedmont LWV Explains City Pension Costs
Article Discusses Cost Sharing between City and Employees –
The following article appears in the September 2012 Piedmont League of Women Voters newsletter, the “Voter,” by Ann Chandler.
“How much do the current [Piedmont pension] plans cost and how are the costs shared? For a 3% at 50 retirement plan (current police officers), PERS requires an annual payment equal to 53% of salary. They consider 9% of that the employee’s share, and 9% is withheld from Piedmont police paychecks. PERS considers 44% the employer’s share. A few years ago the city negotiated with police that the city would pay 37%, and employer and employee would share equally any amount above that. The difference is now slightly over 7%. The police pay a little more than half of that – 4%. By paying this portion of the employer’s share, as well as their own 9%, each police officer is paying about 13% of their salary to PERS, and the city is paying PERS an amount equal to about 40% of each police salary.
For miscellaneous employees the figures are different. Because they are expected to work 10 years longer than safety workers, their retirement costs less. For a 3% at 60 retirement plan (current miscellaneous workers) PERS requires an annual payment equal to almost 31% of salary. PERS considers 8% to be the employee’s share, and 23% the employer’s share. However, Piedmont has agreed to pay the employee’s 8 %, plus a little over 22%, for a total of slightly over 30%. Miscellaneous employees pay less than 1%.
