
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SATURDAY, April 13, 1991                   TAG: 9104130459
SECTION: VIRGINIA                    PAGE: A-3   EDITION: METRO 
SOURCE: JOEL TURNER/ MUNICIPAL WRITER
DATELINE:                                 LENGTH: Medium

RETIREMENT PLAN RECOMMENDED/ ROANOKE COUNCIL CONSIDERS INCENTIVES

In an effort to cut payroll costs, City Manager Robert Herbert will recommend that the city offer financial incentives to 123 municipal workers to retire this year.

He will propose the incentive plan, which may save $275,000 a year, when he presents his proposed $152 million budget to City Council on Monday.

The city manager had said earlier that he was considering the plan because of the slumping economy, which has caused a reduction in state aid and has slowed the growth in local tax revenues.

The city could replace some workers with younger, lower-paid employees. But the plan would not necessarily produce a substantial reduction in the work force of 1,960. Many of the employees who would retire would be replaced because they have jobs that are needed, particularly in public safety.

The savings will depend on the number of employees who accept the proposal, but officials have estimated the city could save at least $276,736 a year under the most conservative calculation.

That projection is based on the assumption that 77 employees would accept the incentives, and that their jobs would be filled by other employees.

A non-binding survey to determine employee interest indicated that 55 would accept the incentive plan, 49 would consider it and 19 would reject it.

The plan offers employees:

Retirement benefits calculated based on current salary, rather than a three-year average.

The possibility of receiving a credit for additional years of service.

A monthly supplement until the employee reaches 65, based on years of service.

Herbert said the proposal should not be confused with an early retirement plan. All of the employees are, or will be, eligible for normal retirement by July 1.

"We are not shortening the time for retirement or making any changes that would speed up the retirement requirements for the workers," he said.

The employees will have to decide by June whether to accept the incentives.

Herbert said the plan would make it easier to reduce the city's work force, cut costs and make organizational changes to help deal with the financial squeeze.

by CNB