DECATUR -- Proposed changes to the current city employee retirement plan topped a full agenda at the July 14 council meeting.
The current Decatur plan is a money purchase pension plan or 401K. Under the plan, the city is required to pay 4 percent of an eligible employee's compensation annually. The employee is required to contribute 4 percent of his or her compensation to the plan each year as well.
The retirement plan under study by the city council and one favored by Decatur city employees is the Arkansas Public Employees Retirement System, or APERS as it is often called.
The APERS plan is a benefit pension plan in which eligible employees will receive their retirement distribution in the form of an "accrued benefit." Employees receive a distribution upon death, disability, "attainment of age 65 with 5 years of service, attainment of age 55 with 35 years of service as an elected or public safety member or any age with 28 years of service."
These benefits are paid on a monthly basis in an annuity.
Under the APERS plan, the city would be required to pay 14.76 percent of an eligible employee's compensation. The employee's contribution would be 5 percent.
By paying on a monthly annuity basis, the city employees would receive continuous compensation after retirement. This is unlike the 401K plan that the city currently has in place which would pay out in either one lump sum or an amount requested by the employee. This can create a problem for city employees.
"Once the money is used up in the 401K plan, it's gone," James Boston, Decatur Public Works director, said. "The APERS plan pays pretty much for life."
The biggest drawback to the APERS plan is the cost to the city of Decatur. Under the current retirement plan at 4 percent, the total amount Decatur pays for all its employees is $15,919.02 a year. With the APERS plan at 14.88 percent, the cost would increase to $65,529.12 a year (figures provided by the city of Decatur).
Linam proposed keeping the current retirement plan and increasing the city's contribution to 8 percent a year. The increase means the city would pay $31,838 into the retirement account of all city employees. This would save Decatur roughly half of what the contribution would cost if the city council decided on the APERS plan.
Because of the delicate and complex nature of the proposed plans, the council decided to table changes until more information can be obtained from APERS.
In other action:
The council voted to allow Mayor Linam to pursue the replacement of the four-way stop system currently in use at Main St. and Roller Ave. with a signal system.
Terry Luker, Decatur police chief, asked the city council to review the Decatur Parks and Recreation policy on camping at any of the city's public parks.
This stems from a recent incident in which the Arkansas Game and Fish Commission requested the removal of campers at Compton Park on the south end of Crystal Lake. According to Luker, the Arkansas Game and Fish regulation states that camping on any of their sites is prohibited unless adequate public facilities are provided (restrooms and trash disposal).
Linam asked Decatur city attorney Michael Nutt to draw up an ordinance to prohibit camping at any of the Decatur parks.
The next city council meeting is scheduled for 6 p.m. Aug. 11 in the council chamber of City Hall. The public is invited to attend and the first 30 minutes of each meeting is open to any Decatur resident to voice opinions or concerns.
General News on 07/23/2014