Marion mulling changes to employee retirement plans
‘ 457 Plan’ designed specifically for government workers
Marion may move its employees from individual retirement accounts into a plan designed specifically for government employees. City Treasurer David Rikard informed the council that he is gathering information about possibly moving city employees out of their simple 401K IRA retirement plans and in to a 457 plan for state and municipal workers.
“We’ve had questions from several employees about getting in to the retirement plan,” Rikard said. “When we talked to the in- vestment guys there have been some changes to the rules this year. We met with (Edward Jones representatives in Marion) and he suggested we change into a government municipality retirement plan.”
Rikard said he isn’t ready to recommend the city switch just yet until he gets more information.
There would be no additional cost to the city to switch to the 457 plan and it may be a better plan for employees, he said.
“There is still some stuff I want to look at,” Rikard said. “The match is basically the same. It gives them some additional benefits where they are able to borrow money from the plan. We do have some employees who want to get into that plan.”
Fire Chief Woody Wheeless said the Fire Department employees have been in the 457 plan for 14 years.
“The thing I like about it is you can actually put more money in that than you can with an individual retirement plan,” Wheeless said.
“I think it’s better than a 401K for sure.”
Councilman Bryan Jackson, who also has a 457 plan through the fire department, agreed.
“Woody and I are both in it,” Jackson said. “Mine has done really good. It’s the right direction to go.”
Rikard said he is open to either option, but added that he would like to get something done by the end of the year.
“I think their ideas were good,” Rikard said. “I just haven’t looked at enough of it to be able to say we should do it. But what I heard so far is good.”
In other business, the city council passed a budget resolution to add $36,000 in expenditures to the 2017 budget.
Rikard said he failed to put in $20,000 for Municipal League legal defense. The other expenses are for the cost of the special bond election and professional fees to Sherry Holliman, who coordinated employee benefits for the city.
Rikard also asked the council to move $200,000 in capitol improvements in the street department budget to the operating expenses budget.
“We’ve done a lot of work on paving costs and most of those costs were on the employees side,” Rikard said.
“So our payroll was over.
Our fuel is over. Our repairs and maintenance is over. Our chemical costs are over our operating budget. So we want to move $200,000 from capitol back to the operating budget. It will have net zero impact. It just goes to different departments.”
The second half of the resolution asked the council to approve adding money from the bond issue into expenditures into the budget.
“The bond hadn’t been passed when we made this budget,” Rikard said. “So we’re just adjusting the numbers for projects we already started. You know most of the projects we have done.”
By Mark Randall