43
McNally calls for more scrutiny of pension contributions
Photo
Mahoning County Commissioner John McNally
YOUNGSTOWN
Mahoning County is paying more than $12 million in contributions to employees’ retirement pensions, something that should be re-examined in upcoming negotiations, says the chairman of the county commissioners.
“The PERS-contribution issue is something the commissioners are concerned about and have directed our folks to start paying more attention to when we bargain,” said Commissioner John A. McNally IV, panel chairman.
PERS is the Public Employees Retirement System of Ohio.
Total PERS costs to the county in 2010 were $12,008,796, including both the employer and employee shares, but the county auditor’s office said it was unable to separate the employer and employee shares. The county’s 2010 payroll was $70,148,320.
“It’s something that usually has come up where bargaining groups have forgone wage increases in a particular contract period and instead have agreed to the portion of their pension being picked up by the employer,” McNally explained.
The amount of county contributions to the employee share of PERS varies from zero for elected officials and ranking officers in the sheriff’s department to full payment of the employee share for drivers, mechanics and laborers in the county engineer’s office.
For 46 members of Teamsters Local 377 and 23 nonunion employees of the county engineer’s office, the county’s combined employer and employee contributions were $1,064,862 in 2010, said Marilyn Kenner, chief deputy engineer.
The engineer’s office pays the employee share in full for both the union and nonunion groups.
Of the total of 1,735 county employees, the county pays all or part of the employee share of PERS contributions for more than 71 percent — 1,237 — of them, according to the auditor’s office.
For most state and local government employees, the employer share of PERS contributions is 14 percent of salary, and the employee share is 10 percent.
For law-enforcement employees, the employer share is 17.4 percent, and the employee share is 10.1 percent.
In the private sector, the employer share of Social Security is 6.2 percent, and the employee share is 4.2 percent of wages up to a ceiling of $106,800 annually.
Auditor Michael V. Sciortino said employer pickup of all or part of the employee share of PERS is the norm in Mahoning County government, but he said it is not the norm for state employees or for employees in other counties.
Employees of the Public Library of Youngstown and Mahoning County pay all of the employee share of their PERS contributions.
Union leaders representing county employees, however, have a different perspective on PERS pickup.
“People have sacrificed raises for that,” said Sam Prosser, president of Teamsters Local 377, which represents employees in the county treasurer’s and engineer’s offices and Child Support Enforcement Agency.
Kenner declined to comment directly on PERS pickup in current negotiations with the Teamsters. She would only say: “Everything is open to negotiation.”
McNally and Sciortino said it would be rare in the private sector for the employer to pay the employee share of Social Security contributions.
Prosser noted, however, that many private-sector employers provide fully funded pensions and match employee contributions to 401K plans.
In the sheriff’s department, ranking officers belonging to Fraternal Order of Police Lodge 141 agreed to terminate the 3-percent county contribution toward their share of PERS beginning Jan. 1 to help fill a budget gap and prevent further deputy layoffs, said Thomas J. Assion, lodge president.
The county pays the 3 percent for nonranking deputies and civilian employees of the sheriff’s office.
In the sheriff’s office, yearly pay ranges from $28,391 to $55,167 for civilians; $24,796 to $42,355 for regular deputies; and from $51,250 to $67,778 for the FOP’s ranking officers.
For the county and for its employees, paying a portion of the employee share of PERS can be preferable to granting an identical-percentage pay increase, Assion said.
The county saves money because the pension-pickup percentage is paid only in relation to the base wage and does not increase the employee’s base salary for purposes of vacation, sick time, overtime or pension calculations, he noted.
“It’s a way for both sides to come to an agreement on something and still preserve financial stability,” Assion added.