Danville council committee backs early retirement plan

DANVILLE - At least a dozen Danville city employees are interested in taking advantage of a health insurance incentive the city is offering to entice employees to retire and ultimately save the city some personnel costs in the next few years.

Mayor Scott Eisenhauer said the potential net savings to the city over the next two years if the incentive is offered could range from $158,000 to $246,905. He said some of the positions the potential retirees are in would not be filled, but he did not specify how many. He also said that others would be filled, but the city could realize savings through lower salaries and less costly benefits in those positions.

The city council's public services committee approved of the incentive offer Tuesday night, voting 5-0. Aldermen Lois Cooper and Kevin Davis were absent.

The committee also voted 5-0 to approve another incentive package that would provide up to $500,000 in sales tax reimbursement to the Village Mall ownership to assist with some of its costs in renovating the 50,000-square-foot former J.C. Penney site for a yet-to-be-named national retailer. Eisenhauer said local officials cannot yet disclose the identity of the retailer, but explained that this incentive costs the city nothing up front, because all of the money would come from sales tax revenue generated by the retailer, not from existing revenues.

Both incentive proposals now move to the full city council for final approval.

The proposed employee retirement incentive would have the city pay 100 percent of an employee's single- or dependent-coverage health insurance premium for one year after retirement or pay 50 percent of an employee's premium for two years after retirement. To qualify, an employee must have 20 years of service and be 55 years of age or older, but employees without 20 years of service but are age 55 or older and eligible to retire can still qualify, as long as it's determined that the employee will draw a pension upon retirement, according to the proposal.

The city surveyed employees to get an indication how many would be interested in the incentive, but Eisenhauer said it's not a guarantee all dozen would decide to retire if the incentive is offered. However, he told aldermen that three are definite.

Alderman Tom Stone asked why the city was not considering a buyout incentive package, in which the city would offer to buy years of service for employees, giving them more years of service counted toward their retirement and pension. Stone asked if that wouldn't get more employees interested in retiring.

Eisenhauer said city administration included such an option in the survey, and a significant number of city employees expressed interest.

Comptroller Gayle Lewis said 50 city employees would be eligible for such a program.

Eisenhauer said that program would require more of a financial commitment on the city's part, and the city is not in a position to do that this year.

Eisenhauer added that the city also is not prepared to lose that large of a number of employees, but the city is still gathering that information and will turn it over to Illinois Municipal Retirement Fund officials to get an idea of what such a program would cost the city.

He said the city may consider that kind of incentive program next spring.

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