Agenda Item 3.1
April 6, 2010
Drummer, Senior Legislative Attorney
Retirement - Imputed
Expedited Bill 16-10, Personnel
Expedited Bill 16-10, Personnel - Retirement - Imputed Compensation Limit, sponsored
by Councilmember Andrews, is scheduled to be introduced on April 6, 2010. A public hearing is
tentatively scheduled for April 27 at 1:30 p.m.
Although the general wage adjustments for FYI0 negotiated with each of the 3 County
employee unions representing police, fire, and general government workers were "postponed"
last year, Expedited Bill 18-09 required that the calculation of regular earnings used to determine
a retirement benefit include the FYI0 general wage adjustment as if the employee had received it
on July 1, 2009.
This imputed compensation is scheduled to carryover into the calculation of
regular earnings used to calculate a defined benefit pension for the rest of an employee's County
career. Expedited Bill 16-10 would amend the retirement laws to limit the effect of the imputed
compensation to the calculation of regular earnings for FYI 0 only.
The County's actuary, Mercer, estimated that this imputed compensation would require
the County to increase its annual contribution to the Employees Retirement System Trust Fund
by $8.589 million per year for the next 40 years. A copy of Mercer's report is at ©5-7 and a
from the Council's actuary, Bolton Partners, Inc., is at 08. The actual
savings from limiting this imputed compensation to FYIO is currently estimated to be $7.2
million for FYll. Annual savings would continue for a total of 40 years.
This packet contains:
Expedited Bill 16-10
Legislative Request Report
Bolton Partners Memorandum
Employees of the Montgomery County Public Schools also agreed to "postpone" a negotiated general wage
adjustment for FYlO, but did not receive this imputed compensation.