Agenda - 03-04-2010 - 2 - Laserfiche WebLink

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ORANGE COUNTY BOARD OF COMMISSIONERS WORK SESSION AGENDA ITEM ABSTRACT Meeting Date: March 4, 2010 Action Agenda Item No. v~ SUBJECT: Retirement Incentive Program DEPARTMENT: Human Resources PUBLIC HEARING: (Y/N) No ATTACHMENT(S): Attachment #1 -Proposed Program Description Attachment #2 -Comparison of Retirement Incentive Programs Attachment #3 -Summary of Currently Eligible Participants Attachment #4 -Estimated Cost Savings INFORMATION CONTACT: Michael McGinnis, Human Resources Director, 245-2552 Diane Shepherd, Benefits Manager, 245-2558 PURPOSE: To approve the offering of an additional Retirement Incentive Program for FY 09-10 to reduce the number of positions in the County. BACKGROUND: As part of the FY2009-10 Budget, the Board approved several Personnel Services Cost Reduction options including a Retirement Incentive Program (the "Program"). This program provided those employees eligible for retirement with the NC Retirement System to receive a special financial incentive if they voluntarily agreed to retire within the 2009 calendar year. Service requirements were based on total credible service in the NC Retirement System with no minimum requirement for Orange County service. Employees from all departments in all positions were eligible to apply for the retirement incentive. In July 2009, Staff identified approximately 150 employees eligible to retire with the NC Retirement System, and estimated that 25% or 37 would apply for the incentive. Savings of $375,000 was projected, based on these positions being frozen for 12 months. Staff implemented this program and the Manager approved incentives for 46 employees (30% of those eligible) retiring between July 1. 2009 and January 1, 2010. Savings are currently estimated to be $800,000, assuming that unfilled positions remain vacant for the remainder of FY 2009-10. As in FY2009-10, the County Manager wishes to avoid a reduction in force of current employees for FY2010-11. However, with the continued financial crisis personnel services costs must continue to be reduced to balance the next budget. Based on this, the Manager asked staff to develop another retirement incentive program, which is described in Attachment 1. In developing the 2010 Retirement Incentive Program (Program), staff increased the eligibility requirements and decreased the timeframes compared to the 2009 incentive. Attachment 2 more completely describes the differences between the 2009 and 2010 programs.