Johnstown schools and Fulton County have both rejected participating in the state’s 2010 Retirement Incentive Program.
Greater Johnstown School District Board of Education President Robert Curtis said far from saving any money for the school district, the early retirement incentive would cost it potentially hundreds of thousands of dollars. The school board rejected the incentive program in a vote of 9-0 Thursday night.
“We estimated that if every teacher eligible for the Part A incentive chose to retire, it would have cost the district $1.8 million,” Curtis said.
The state program is broken into Part A and Part B, both of which were rejected by the school board and the personnel committee of the Fulton County Board of Supervisors.
Part A of the program allows public employees who are at least 50 years old with 10 years of service to retire with an additional one month of pension service credit for every year of service, up to 36 months. Whatever governmental entity the employee retired from would have to provide the state pension contribution for each of those extra months of credit.
Part B of the program allows public employees at Tier 2, 3 or 4 of the state pension system who are at least 55 and have 25 or more years of service credit, to retire without a benefit reduction. Each employer who accepts the state incentive can chose which employees it would allow to participate and exclude some employees deemed critical to the maintenance of public health and safety.
Johnstown 2nd Ward Supervisor Michael Kinowski, chairman of the county’s personnel committee, said another condition of Part B was any employee hired to replace retirees would need to cost the county less than 50 percent of the wage and benefits of the retiree.
“Our pay scales are such with the county that that would be impossible to do,” Kinowski said. “You have to save money. That’s the whole point of the program, not to have people retire early. There wouldn’t be any savings in our situation.”
Both Curtis and Kinowski said another factor eliminating the potential for savings from the early retirement program is the state mandate requiring local governments to continue to provide health insurance coverage for retired employees.
Curtis said forcing his school district to provide health insurance for workers who retire more than 10 years ahead of Medicare eligibility would be a fiscal disaster.