Pension comparison presented at General Meeting
The three comparisons show the improvement for a 25 year General Fund employee between the current pension plan and the plan under consideration. It also compares the benefit under the new plan with the current Police plan. Notice the benefit is almost equal. This is because the Police have an age penalty the the General Fund employee avoids due to the Rule of 75. Of course different ages and years of service would result in different benefits, but overall, the plans have been greatly leveled.
| Pension Comparison: | |||
| Employee Name: | General Employee-Age 50 | ||
| Approximate Years of Service: | 25 | ||
| Approximate Avg 3 year Salary: | $40,000 | ||
| Old DB Plan | New DB Plan | City of Atlanta Police | |
| General Employee | |||
| Vesting Period in Years: | 15 | 10 | 15 |
| $40,000 | $40,000 | ||
| % Multiplier: | 2% times # of years served | 2.5% times # of years served | 3% times # of years served |
| Retirement Penalty: | 45% Penalty | NO Penalty | 15% Penalty |
| 6% Penalty for each year (5) | 30% Penalty (55-60) | ||
| 3% Penalty for each year (3.2)) | 15% Penalty (50-55) | ||
| Date of Retirement W/0 Penalty: | 2015 | NOW | 2010 |
| Earlier Retirement in Years: | 0 | 10 | 5 |
| Annual Retirement Salary Benefit: | $11,000 | $25,000 | $25,500 |
| (Retiring 09/22/2004) | No Cap | 80% Cap | 80% Cap |
| Replacement % of Original Salary: | 27.5% | 62.5% | 63.8% |
| Difference in Annual Retirement Benefit: | $0 | $14,000 | $14,500 |
| 20 Year Differential (Life Expectancy): | $0 | $280,000 | $290,000 |
| 20 Year Total Payout (S/L): | $220,000 | $500,000 | $510,000 |
| Average Employee Increased Benefit over 20 years | $280,000 | ||
| Approximage Cost to City for Pension Improvements: | $ 18,900,000 | ||
| 10 Year Vesting | $ 300,000 | ||
| Rule 75 | $ 5,400,000 | ||
| 2.5% Multiplier | $ 13,200,000 |