BOS - October 31, 2002 - Early Retirement Incentive Program

BOS - October 31, 2002 - Early Retirement Incentive Program

Postby Suzanne Kane » Wed Nov 12, 2008 2:59 pm

Board of Selectmen
Meeting Minutes
October 31, 2002
Approved November 19, 2002

1. Call to Order:

Madame Chairman Shirley Mosczynski called the meeting to order at 7:00 pm. In attendance: Paula Brouillette, Rich Preston, Ron Forget, Edward Therrien, Executive Administrator Kenneth Mahony, and Administrative Assistant Suzanne Kane.

Handed out is a copy of a memo to All Retirement Boards, from Joseph E. Connarton, Executive Director Commonwealth of Massachusetts, Public Employee Retirement Administration Commission (PERAC), dated May 24, 2002; letter to the Board of Selectmen, from Kenneth Mahony, dated October 25, 2002, re: Early Retirement; letter to the Board of Selectmen, from Town Treasurer Sharon Brotherton, dated October 24, 2002; letter to Town Treasures Sharon Brotherton, from Ken Mahony, letter to Town Treasurer Sharon Brotherton, from Michael J. Donoghue Treasurer – Chairman Worcester Regional Retirement System, dated October 24, 2002; and a letter to the Board of Selectmen, from Ken Mahony, dated October 30, 2002, re: Early Retirement Incentives (ERI).

The Board met to discuss the Local Governments Early Retirement Incentive Program established on May 15, 2002. In order to establish an ERI, Douglas must accept the provisions of Chapter 116 of the Acts of 2002, section 1 by a vote of the Board of Selectmen on or before November 1, 2002. Ken Mahony explained that the legislation is offering the ERI to allow municipalities to cut costs. Douglas would not see a benefit due to our limited staffing; this would only be a benefit to the employees. All positions would have to be replaced. Eligibility requires an individual to be at least 55 with 10 years of service. Ken Mahony explained that the calculation for the impact on the Town is difficult because they use different tables. Douglas has 10 to 15 eligible employees. Ken Mahony explained that you take the age of the individual plus his life expectancy and figure the cost to the Town over the term of retirement. He stated that the figures received by Town Treasurer Sharon Brotherton were high because the Worcester Regional Retirement System did not average the top three years. He stated that the Town pays and employees insurance at 80%, which drops to 50% once they retire. Mr. Mahony feels that no more than four people will take advantage of this offer. He stated that he hates to recommend this incentive because the numbers could change although he does not feel it will cost the Town much money. Several Selectmen stated that the only employees that they knew who were interested in taking advantage of this offer were Water / Sewer Director Anthony Gressak and Highway Employee Edward Espanet. Shirley Mosczynski stated that she was looking for figures, what the impact on the Town would be. Rich Preston asked how long this would be offered and was told there was a 30 day window, it is only good until December 31, 2002. He also asked what other communities have done. Mr. Mahony stated that Webster and Uxbridge have approved it. Dudley had also approved it and then ended up with mostly all of their eligible employees taking advantage. Mr. Mahony stated that he had spoken with Executive Administrator David Owen who stated that the Town of Milton limited the offer to Highway employees only. Ron Forget stated that the two employees that they know who are interested will be retiring anyway. Paula Brouillette asked why we don’t have a complete list of all eligible employees. Ken Mahony stated that he had asked Sharon Brotherton to contact the Worcester Regional Retirement System to get the list but she gave them a list and asked for totals. She missed some employees. Shirley Mosczynski again stated that she had asked for information several months ago. This is coming to the Board last minute and they don’t have accurate figures to make an informative judgment. Paula Brouillette asked what guidelines other communities used to limit the retirement. Ken Mahony stated that the decision made by other communities was done at their convenience. Rich Preston asked if they approve the incentive, do they need to be specific or careful in the wording not to include schools. Ken Mahony said no, it is already specific and then read a section of the letter from PERAC stating, “Employees who were eligible to participate in the Judiciary ERI, State Employees who were eligible to participate in the State ERI and teachers who are members of the Teachers’ Retirement System or the Boston Retirement System are not eligible to participate in this ERI.” Shirley Mosczynski asked, what would be the impact to the Town if in the worse case, everyone goes. Ken Mahony stated that he did not know because you would need an annuity schedule. Paula Brouillette asked if that isn’t what Sharon Brotherton gave them? Mr. Mahony stated, no, each person has a different life expectancy and you can not get a lump sum from that. He stated that he had become frustrated with trying to figure the impact on Douglas and asked for help, asking Sharon Brotherton to contact Worcester. He explained again that her figures were high because Worcester did not average them, stating it would actually be 2/3rd‘s that amount. Paula Brouillette asked if what Mr. Mahony was saying was, 66,000 is overstated, and 50,000 per year would be the actual worse case: and does this then become an obligation in our next FY04 budget. Mr. Mahony stated yes, adding it was going to be a bad year anyway. Rich Preston asked that if by approving this initiative, would the Board be setting a precedent; obligating them to continue this program. Ken Mahony stated that the State would have to pass another bill. This is a one shot deal. Paula Brouillette stated that the benefits to small communities is not the same as big communities and asked if there would be a problem if they limited the program to say 5 people. Ron Forget stated that he felt one of the fall outs would be that if they did not approve the program and then find only two people were interested, the Board looks bad. Rich Preston stated that they have a list of nine eligible employees, but they are not sure if there are more, then asked why we don’t have a data base to pull that information. Mr. Mahony stated that it is more involved than that, eligibility could be from service to another Municipality or Military Service. In Douglas we only know who is over 55. Shirley Mosczynski asked if the worse case fits into our budget. Ken Mahony stated it would be a disaster. Rich Preston then asked what number would be less then disaster, what is a reasonable number. Ron Forget feels that if the employees really wanted this incentive, they would have been knocking down the doors asking for it. Mr. Mahony explained that this becomes an employee benefit not a Town benefit, so he didn’t do much with it. After comments were made about “poor employees” he decided to look into it. Rich Preston agreed with Ron Forget that they have not heard from the employees that this is what they want. Suzanne Kane cautioned the Board that the employees don’t typically go to the Board for things, but they do discuss the issues amongst themselves. Paula Brouillette feels that it’s a good thing, but feels they need to find a good balance, one that will be good for the Town. Ron Forget, again stated that the age group they are talking about could find it difficult to take advantage of this offer; it may be more beneficial to for them to stay employed. Shirley Mosczynski asked if the Town can afford another 50,000 a year. She feels the employees have done a good job and deserve this. Rich Preston stated that people don’t look at the numbers. They think with their hearts and not their heads. We think nothing about spending money in other places, this is giving something back to the people who have given years of good service to the Town, you want to give it to them, but can the Town afford it. Paula Brouillette stated that the results of this are different from the intent, we have so few benefits to give the employees, it would be nice to be able to give this, but do we know what the impact is going to be on the Town. Ron Forget fells they should go for it. Edward Therrien concurred, stating, “This is a one shot deal, it’s not going to come back”. Ron Forget made a motion that the Town of Douglas, MA accepts the provisions of Section 1, Chapter 116 of the Acts of 2002, MGL. These provisions create Early Retirement Incentives for employees of the Town of Douglas, excluding the School System, under defined circumstances to retire prior to December 31, 2002 with additional benefits. Any qualified person seeking to retire under this act must file retirement papers prior to December 2, 2002 and must be retired and off the Town payroll by December 31, 2002. Rich Preston seconded the motion. Ken Mahony stated he believes Category 2 employees are allowed under this. On the vote – Paula Brouillette – aye, Rich Preston – aye, Shirley Mosczynski – aye, Ron Forget – aye, Edward Therrien – abstained.

2. Adjournment:
Ron Forget made a motion to adjourn at 8:20 pm. Rich Preston seconded the motion. All – aye.

Respectfully submitted,

Suzanne Kane
Administrative Assistant
Suzanne Kane
Posts: 617
Joined: Wed May 25, 2005 2:01 pm

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