Fifteen years after employees first requested that the idea be considered, the Bulloch County Commissioners voted to overhaul employee retirement plans.
The change, approved Tuesday night, means employees will soon have the option to convert their retirement plans to a defined benefit plan, as opposed to the current plan, which is a defined contribution plan. The same change means employees will receive a guaranteed monthly benefit once they reach retirement age.
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session on Tuesday
District employees from all departments again lined the halls, the commission room and the steps in front of the building, waiting for a vote. The decision was postponed in mid-October after chairman Roy Thompson broke a tie to wait until the November meeting. Commissioners Simmons, Mosley and Gibson had all said they needed more time to evaluate the analysis and plans presented to them about two weeks earlier.
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The somewhat anticlimactic vote was unanimous, despite a lack of discussion or even any real indication of what the commissioners were voting on. After anticipating that the issue was a “carryover from a previous meeting,” Chairman Roy Thompson asked for a motion, which Commissioner Anthony Simmons made, saying only “I am making a motion for approval”. The motion was backed by Commissioner Timmy Rushing and passed 6-0 by hand. There was no further discussion.
Tuesday’s vote also followed a series of staff leadership workshops last year, in which a committee of staff from different departments presented proposals to the commissioners. The committee was formed after Sheriff Noel Brown petitioned the commissioners in September 2021 to honor a promise to explore retirement options about a decade ago. County staff enlisted the support of ACCG Retirement Services, which provided the county with a cost-benefit analysis free of charge.
Immediately after the vote, staff gathered outside the building and applauded the committee members who had lobbied for the changes on their behalf over the past year.
Specified Benefit vs. Specified Contribution
Bulloch County currently offers a defined contribution plan that puts both employer and employee contributions into an account that is in turn invested in stocks. Thereafter, the value depends on market conditions across 401a and 457b employee benefit plans. The county contributes 6.5% of participating employees’ gross earnings to a 401a defined contribution plan and adds a 50 percent match of up to 2% of gross earnings to the 457b account.
However, workers have long advocated a defined benefit plan or a hybrid of defined benefit and defined contribution plans. Both alternatives provide eligible employees with a guaranteed income when they retire, using a formula based on factors such as the employee’s salary and years of service. Supporters of the reform say the latter options allow employees to better plan their retirement, rather than retiring and then learning what benefits they’ll receive depending on fluctuations in market conditions.
County Commission-approved defined benefit plan
The new plan will be a quasi-option for all current employees, but new employees will be required to participate in the defined benefit plan as opposed to the defined contribution plan.
Current employees have the option to give up their 401a balance in exchange for credited service on the defined benefit plan. Employees would then receive vested and credited service back up to their hire date, and they would keep the balance in their 457 accounts with no additional county contribution.
Employees who do not agree with the buyout can keep their 401a plans subject to market changes, but no additional funds will be deposited into their account. You would then enter the defined benefit plan on the effective date beginning with 0 years of service. The 457 plan would remain unaffected without additional contribution from the county.
The approved baseline includes:
- A multiplier of 1.5%
- Freedom of movement after 5 years
- A retirement age of 65
- Full early retirement at age 60 with 30 years of service
- Reduced early retirement age of 60 with 10 years of service
A lock-up period of one year applies to employees under the age of 65, with the exception of retirement by this date. For employees who are 65 years of age or older, the blocking period is six months.
Pensions for law enforcement and firefighters will also be phased out under the new plan as of the Effective Date, and the county will no longer be responsible for funding those pensions. However, the county offers payroll deductions to these first responders if they choose to pay the fees from their paychecks.
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