Early retirements of city employees net savings

2013-07-03T19:47:00Z 2013-07-04T18:55:11Z Early retirements of city employees net savingsJoyce Russell joyce.russell@nwi.com, (219) 762-1397, ext. 2222 nwitimes.com

PORTAGE | The buyouts of seven city employees last year has netted the city savings.

But two officials disagree how much the city has saved.

At this week's City Council meeting, Mitch Ripley, the city's human resource consultant reported to the council that in August the city offered early retirement packages to 10 city employees. Seven employees took the offer.

The Park Department lost a total of four employees, three through early retirement and one by resignation. One employee was rehired.

One employee retired from the Police Department and the position has been staffed with part-time workers.

At the Street Department, two retired and one resigned. The position of the employee who resigned has been filled.

At the clerk-treasurer's office, one employee retired and was replaced by a part-time employee.

The retirement packages cost the city $881,000.

Ripley told the council the early retirements saved the city $218,374 in salary and insurance premiums and another $374,368 in "known" medical claims.

Ripley defined the known claims as "an expense we were paying that we aren't paying anymore."

Clerk-Treasurer Chris Stidham disputed the savings and told Ripley he doesn't believe the program has lived up to its promises.

"I look at it differently," said Stidham, explaining that savings on the health insurance claims can't be counted on because claims could have ranged from nothing to above Ripley's number.

Stidham said his calculations indicated $190,390 was saved in salaries, insurance premiums and employee-related taxes. He did agree that on health claims, $374,994 in potential claims was saved.

Stidham, however, said the program has not saved as much as promised.

Stidham said with the council voted on the early retirements last year, they were told $2.8 million would be saved over three years in salaries, or $933,333 per year. Projecting the nine-month savings for a full year, the real number would be $253,853.

The same, he said, was promised in health insurance claims, falling short of what was promised.

Mayor James Snyder said he believes the program is working and believes the city will recoup the early retirement expenses by the end of the year.

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