City of Marietta: Road to Retirement Meeting (2025-10-21)

On October 21, 2025, the City of Marietta hosted a "Road to Retirement" presentation led by HR Director Keisha Register, Finance Director Patina Brown, and Pension Board Chair Bobby Moss. The session aimed to educate employees on the consolidated pension plan (City Code 4532), covering eligibility, vesting, the pension calculation formula, survivor benefits, and healthcare premiums. The meeting utilized interactive quizzes and Excel calculators to clarify retirement scenarios for both pre-2009 and post-2009 hires.

Consent Calendar

• No routine consensus items were discussed; the meeting focused entirely on educational presentation and Q&A.

Public Comments & Testimony

• Employee Inquiry (Medicare/Social Security Deductions): An employee asked if Medicare premiums or Social Security taxes are withheld from retirement checks. Speaker Keisha Register noted she needed to confirm specific withholding details with Payroll but initially clarified that retirees generally complete tax forms similar to new hires and that Medicare is not typically a direct reduction from the check, though payroll confirmation was promised.
• Employee Inquiry (Social Security Offset): An employee raised concerns about the "windfall offset" reducing Social Security payments due to the city pension. Speakers clarified that the windfall offset no longer applies to employees who have met the 40-credit (10-year) requirement for Social Security; retirees now receive their full Social Security benefit plus their full city pension.
• Employee Inquiry (Spousal Health Care): An employee expressed interest in the cost differences for spousal family coverage. The presenters explained that premiums vary by hire date and years of service, with some plans being "frozen" at the retirement rate while others are percentage-based (e.g., employee pays 15%). The presenter confirmed that for those with 20+ years of service hired prior to 2006, premiums may be zero.
• Employee Inquiry (Break in Service): An employee, represented as a past employee working 5 years before leaving (referred to as the "poster child" for this issue), discussed the risks of break in service. Key speakers affirmed that employees with a break exceeding 5 years forfeit all prior service credit, while those with breaks under 5 years receive 50% credit for prior years, emphasizing the difficulty of re-vesting under current 10-year rules.

Discussion Items

Pension Eligibility and Vesting

• Vesting Periods: Chair Moss clarified that employees hired after January 1, 2009, require 10 years of service to vest, up from 5 years (pre-2008) and 7 years (2008-2009). The longer vesting period is intended to minimize risk and improve retention.
• Magic 80 Rule: It was explained that "Magic 80" is the sum of age and years of service. Pre-2009 employees can retire upon reaching Magic 80 (e.g., starting at 18, retiring at 49). Post-2009 employees must reach Magic 80 AND be at least 55 years old. For those meeting Magic 80 before age 55, retirement is still restricted until age 55 under current rules.
• Early Retirement Reductions: Speakers discussed the financial penalty for retiring before age 65 without meeting full eligibility. If an employee retires at 55 without meeting the "Magic 80" requirements, a reduction of 0.0025% per month (totaling ~30% for a 10-year gap to age 65) is applied. This deduction is permanent and does not increase to full payment upon reaching age 65.

Pension Calculation Formula

• Earnings Basis: Patina Brown detailed that for those hired before January 1, 2009, the top three years of earnings are used; for those hired after, the top five years (highest 60 consecutive months) of standard earnings (excluding overtime) are used.
• Multiplier: Most current employees use a 2.1% multiplier, while those separated prior to December 12, 2001, retain the 2% multiplier.
• Service Credits: Employees can add a maximum of one year of credited service by utilizing either sick leave (up to 1,000 hours for general employees) or military service, but not both simultaneously. Vacation time does not count toward pension calculations.
• Maximum Benefit: The maximum pension benefit is 73.5% of the final average earnings after 35 years of service.

Survivor Benefits and Death Benefits

• Pre-Retirement Death: Speakers confirmed there are no pension death benefits for active employees. Beneficiaries receive the refund of the employee's 4% contributions, employer-paid life insurance (dropping to $25,000 for retirees from $300,000), and balances in 457/MMSA accounts.
• Survivor Options: Retirees can select single life, 50%, 75%, or 100% survivor options. A "pop-up" feature is highly recommended, which restores the retiree's full payment if the beneficiary predeceases them. Keisha Register noted that a spouse must sign a notarized consent form to opt out of a survivor benefit entirely.
• Social Security Option: A specific option was discussed where retirees receive a higher initial pension payment until they become eligible for Social Security, after which the city pension is significantly reduced. Speakers emphasized this is rarely used compared to standard retirement options.

Healthcare Premiums

• Frozen vs. Tiered Rates: Speakers distinguished between "frozen" rates (capped at the retirement year's cost, typical for pre-2006 hires) and tiered percentage contributions (e.g., employee pays a fixed percentage of the current premium, typical for post-2006 hires).
• Transition to Medicare: Retirees remain on the Anthem plan until age 65, at which point they transition to a Medicare Advantage plan (currently with Aetna), which may alter costs.

Key Outcomes

• Calculation Tools Confirmed: Employees were directed to the T-drive under the "pension" folder to access Excel calculators to determine their specific Magic 80 dates.
• Payroll Clarification Pending: The HR team committed to following up with Payroll to confirm if any Medicare premiums are deducted from retirement checks; it was tentatively confirmed that Social Security taxes are not withheld from city pension checks for those meeting the 10-year SS requirement.
• Consolidated Plan Status: The city continues to operate under City Code 4532 (the consolidated plan), replacing the old code 4022, with nearly all active employees now vested under the 10-year rule.
• Retention Strategy: The 10-year vesting requirement was reinforced as a deliberate strategy by the Pension Board to ensure long-term retention and mitigate plan risk.
• Next Steps: Attendees were encouraged to review the provided slides and schedule appointments with Benefits Manager Sherry Glover for personalized calculations. An interactive quiz was concluded with several winners announced from the audience.