GO Item 6
April 25, 2011
April 21, 2011
Government Operations and Fiscal Policy
Drummer, Senior Legislative Attorney
Expedited Bill 11-11, Personnel- Retirement Plans
Expedited Bill 11-11, Personnel - Retirement Plans - Contributions, sponsored by the
Council President at the request of the County Executive, was introduced on April 5, 2011. A
public hearing is tentatively scheduled for April 26 at 7:30 p.m. A second worksession is
tentatively scheduled for April 28 at 9:30 am.
Bill 11-11 would increase member contributions by 2% of salary in the Optional and
Integrated defined benefit plans of the Employees' Retirement System (ERS) and decrease
employer contributions by 2% of salary in the defined contribution Guaranteed Retirement
Income Plan (GRIP)I and the Elected Officials' Plan of the Employee's Retirement System and
the Retirement Savings Plan (RSP). This Bill is necessary to implement the Executive's FY12
The Executive estimated the FY12 savings from increasing the ERS
member contributions by 2% in the defined benefit plans to be $6,044,180. The Executive
estimated the FY12 savings from reducing the employer's contribution to the defined
contribution RSP and GRIP by 2% to be $4,860,290. See ©9.
The Bill would take effect on July 1, 2011 for all County employees, except elected
officials. The Bill would take effect for elected officials on the first day of their next term of
office. Article III, §35 of the Maryland Constitution prohibits an increase or decrease in
compensation during a term of office for an elected official. The State's Attorney, the Sheriff,
Although the GRIP is a cash balance hybrid plan, we are considering it a defined contribution plan in this
discussion because the employer's contribution as a percentage of salary is fixed.
The arbitration awards
favor of the International Association of Fire Fighters (IAFF) and the Fraternal Order of
Police (FOP) include no changes to the current retirement plans for fire fighters and police officers. The arbitration
award in favor of Municipal and County Government Employees Organization (MCGEO) contains a similar one
year 2% reduction of the employer contribution to the RSP and GRIP and a one-year reduction in the employer
contribution to the defined benefit plan with the members not earning service credit for FYI2. The Executive did
not recommend these retirement provisions in his FY12 Recommended Budget. The Council's review of the
collective bargaining agreements with the County employee unions will be considered separately.