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Forty-four county employees who are eligible for retirement between April 1 and June 30, 2013, are now eligible for a voluntary retirement incentive from the county on a first-come, first-serve basis.

On Tuesday, the Calvert County Board of County Commissioners unanimously approved a voluntary retirement incentive plan that would allow eligible employees in the Calvert County Employees Retirement Plan, also known as the defined benefit pension plan, to receive $1,000 per whole year of service for full-time employees and $500 per whole year of service for part-time employees — which could cost the county a one-time incentive payment of up to $1.24 million.

“This is voluntary,” Director of Finance and Budget Tim Hayden told the commissioners. “We are trying to lower our costs. We’re going about it in all kinds of methods, and this is one more.

“The goal with this, along with reducing our pension expenses, would be to lower staff count.”

According to a staff memo from Hayden, the current projected fiscal 2014 deficit is $9.3 million. The memo states that the deficit continues to grow as the county moves toward fully funding the Calvert County Board of Education and county other post-employment benefits.

As of June 30, 2012, there are 297 county employees in the Calvert County Employees Retirement Plan, of which 146 are active employees and 151 are retired or have left their position with the county but are eligible for retirement benefits.

Those employees eligible for the retirement incentive have worked at least 30 full years with the county or are 62 years old or older. Enterprise Fund, Housing Authority and Calvert Marine Museum Board of Governors’ employees would all require approval from their respective authorities, according to a presentation from Hayden.

In fiscal 2013, there would be an additional $725,000 one-time cost, Hayden said, if the county assumes 37 general fund employees are eligible for retirement, 19 of those accept the offer and 10 of those are replaced at 80 percent of the previous salary. Based on the same assumptions, the estimated annual recurring savings would be about $1 million in the general fund.

Hayden said even if all eligible employees accept the offer, there would still be some savings, although if all eligible employees decide to accept the offer, the one-time incentive payment for fiscal 2013 would be $1.24 million. He explained that the figure is a result of a combined 1,242 years of service between all 44 eligible employees, multiplied by $1,000.

Commissioner Susan Shaw (R) said one of her “very, very serious concerns” with the plan is that she doesn’t think it’s realistic that half of the employees will not need to be replaced.

“My experience is that we’re running an extremely lean county government. We have many, many employees who are really, and for a long time have been, going above and beyond,” Shaw said.

She said her other concern with the plan is “losing a lot of institutional knowledge all at one time.”

“I think sometimes it’s possible to save a dollar up front and then to have hidden costs that follow behind and I’m really hopeful that that’s not going to happen here,” she said. “Like I said, we have to keep our costs as low as we possibly can and still be as fair to our employees as we possibly can and to the taxpayers, of course. So, it’s always a balancing act that goes on. I mean, we’ll see what happens with this. … I’m less than optimistic about not having to replace a lot of the people.”

Hayden explained, “The goal would be not to [replace retiring employees]. We’re going to work with the department heads to try and figure out how not to replace the people. It would require some shifting around in the organization, I would imagine. It will be very difficult.” Hayden added that there is an assumption that some will have to be replaced.

Commissioner Gerald W. “Jerry” Clark (R) noted some employees would be promoted to the vacant positions and then the lower position would be eliminated.

“I don’t think that it’s anyone’s idea that we would reduce any service qualities whatsoever,” he said. “Basically, what you’re doing here is what’s been done all over the county, in private businesses and other places where you have employees who are close to retirement who are given an incentive to retire.”

He explained that some of the replacements will be newer employees who are in the Calvert County Employees Retirement Savings Plan, also known as the defined contribution pension plan, which costs the county less per year than the Calvert County Employees Retirement Plan.

“I think this just helps us along going forward with the yearly expenses for retirement and health care and different things,” Clark said.

Commissioner Evan Slaughenhoupt (R) said “something to keep in mind [is] we want to perhaps be cognizant that we don’t create a rotating door where we have individuals taking this retirement and then coming back on contract,” though he did note that there may be situations when that is beneficial.

Hayden told the commissioners this is phase 1 of trying to lower costs through retirement incentive plans. He said there may be a phase 2 that would consist of other county employees.

In other business, the BOCC unanimously approved a one-year contract with Martel Laboratories JDS Inc. of Baltimore for the collection, transportation and analysis of designated water samples on a regular basis for bacterial monitoring of drinking water systems located in Calvert County for the Water and Sewer, Parks and Recreation and Buildings and Grounds divisions.