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Willmar city staff see early retirement incentive as earned benefit they want to maintain

WILLMAR -- The City Hall conference room was full of city staff Wednesday as the Willmar City Council discussed whether to sunset the early retirement incentive policy which grants qualifying employees a monthly stipend to help pay for health ins...

WILLMAR - The City Hall conference room was full of city staff Wednesday as the Willmar City Council discussed whether to sunset the early retirement incentive policy which grants qualifying employees a monthly stipend to help pay for health insurance if they retire early.
Currently, the policy provides employees with one year of health insurance for every three years they have worked for the city, capping it at $430 per month.
City Administrator Larry Kruse said the policy was implemented in 2007, during a time the city was looking to entice employees to retire early. The program was open to employees who have worked for the city for at least 20 years and able to collect a pension from the Public Employees Retirement Association of Minnesota. The health insurance benefit runs until the years of service are exhausted or the employee is eligible for Medicare. In 2008 the City Council extended the program indefinitely, according to a Jan. 16, 2008, interoffice memo sent to department directors from then-City Administrator Michael Schmit.
The issue of whether to change the policy arose this year when the Supervisor’s Unit requested language about the policy be added to their labor contract. Council members on the negotiating team are now recommending providing a reasonable notice of the program’s reduction and eventual elimination.
The negotiating team’s reduction plan is a three-tier drawdown of the policy. Those eligible employees who give written notice of their retirement before Jan. 1, 2017, will receive the full $430. Those giving written notice between Jan. 1, 2017, and July 1, 2017 will receive $300 per month. The employees who give notice after July 1, 2017, will not be eligible for any early retirement payment.
Kruse said the program has been in place for so long, eligible employees now see it as a benefit they have earned. Kruse has concerns that if the program is taken away, the city might see a rash of early retirements, causing a great loss of skill and experience at the city.
Public Works Working Foreman Gary Manzer, who has worked for the city for 32 years, said he would disappointed to see the policy sunset.
“That has a huge impact for some of us,” Manzer said.
Manzer said the removal of the early retirement program would take care of itself in the coming years.
“It seems to me it would take care of itself in due time with people retiring. The people who can take advantage of that grow smaller,” Manzer said.
Manzer said he is also worried about the effect on those employees planning on taking advantage of it in the next few years.
“Really consider when you make that decision, if you change that, what kind of impact that would have. It is more than a number, it is people,” Manzer said.
Kruse said the early retirement fund is fully funded. Currently, there are 38 city employees who are eligible for the program, which represents about 40 percent of the city’s workforce, Kruse said.
“How many would go is a total unknown,” if the program would be taken away, Kruse said.
The Labor Relations Committee in a voice vote, with Council member Denis Anderson voting against, tabled the issue, wanting more information about the money involved in the program and who is eligible.

Related Topics: WILLMAR CITY COUNCIL
Shelby Lindrud is a reporter with the West Central Tribune of Willmar. Her focus areas are arts and entertainment, agriculture, features writing and the Kandiyohi County Board.

She can be reached via email slindrud@wctrib.com or direct 320-214-4373.


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