The 1945 and 1949 pension plans, named for the years they were established, were closed to new members decades ago, but about 70 plan members remain on the job, having made no contribution to Social Security unless they had other employment, Finance Director Donna Williams said.
After inquiries from those employees, Williams said she explored options that would allow them to be covered by Social Security.
After consulting with pension counsel Ice Miller LLC, Williams determined the change would require a referendum of all covered employees. If they approve, the city would incur the additional expense of matching employee Social Security contributions, she said. Employees must determine whether they have time before retirement to work the minimum amount required to collect the benefit.
The matter and a 1.7 percent pension cost-of-living adjustment will go before the Augusta Commission on Tuesday.
At last Monday’s meeting of the pension and audit committee, pension manager Morgan Stanley presented a report on the plans’ performance and balances.
The 1945 plan, which was the old Richmond County (before city-county consolidation) employee pension, has 24 surviving retirees and two active members. Its investment return over 2012 was 11.1 percent and its balance on Dec. 31 was $6,048,888.
The 1949 plan, which was the old Augusta pension, has 62 active employee members. Its return over 2012 was 12.9 percent and its balance Dec. 31 was $58,375,674, according to the report.
The “mature” plans are being eyed by Augusta attorney Jack Long, who represents several city pensioners. He asked about what would happen to leftover plan money if all members die.
“It does not belong to the government,” Long said, citing an earlier opinion from former city attorney Steve Shepard.
Williams, who indicated that surplus money was unlikely because the city still must contribute annually to the plans to meet state requirements, said any leftover money would return to the city.