Acting on recommendations presented by the Department of Fiscal and Administrative Services and Prudential, the Charles County Commissioners voted unanimously Tuesday, May 3 to make adjustments to the Charles County Government Pension Plan.
The plan’s actuary, David Pappalardo of Prudential recommended changes to the county government’s Employee Pension Committee and the panel agreed with the recommendations.
The recommended changes are:
· Reducing the investment return assumption from 8 percent to 7.75 percent. This will increase the annual required contribution (ARC) by $729,000.
· Make the plan reflect improvements in mortality that been made since the 1990s. This will increase the ARC by $390,000.
· Reduce the salary increase assumption from 5.5 percent to 4.5 percent. This will decrease the ARC by $1.1 million.
According to information posted on its web site, Charles County government had nearly 800 employees in fiscal year (FY) 2011. The average age of a government employee was 45 with an average of nearly 10 years of service. The average salary of a Charles County Government employee was nearly $57,000.
At age 62 an employee may retire and collect an annuity. Currently, there are 224 retirees in the Charles County pension plan and the average age is 68. The average annual benefit is $14,000.
Employees and the county contribute to the pension plan. Public safety employees are mandated to contribute 7 percent of their pay to the retirement plan while other employees are required to pay 4 percent.
“People are living longer and collecting their retirement premiums,” said Pappalardo.
“The pension plan is healthy?” Commissioner Ken Robinson [D] a
