Last week the Niagara Falls Reporter broke the story on Mayor Paul Dyster’s retirement incentive plan.
Two days later, the mayor issued a press release providing a few details on his new program and the Niagara Gazette and Buffalo News carried the story.
In his budget address last week, the mayor further explained.
"This offer is intended to get city employees who are near retirement but have not yet made the decision to retire to consider leaving now rather than waiting a year or two more." the mayor said. “This can help us reduce future personnel costs, since we would have the option to either eliminate the position being vacated, or fill it with someone more junior at lower cost to the taxpayer."
He added, “The least painful way to reduce overall personnel costs is through attrition—essentially, trying to avoid filling vacant positions as people retire and restructuring to ensure essential work still gets done.”
What Dyster has made clear is that there are about 60 employees - steel workers’ union members - no police or fire - that he so far has invited to retire early. The plan features a $20,000 going away bonus for retirees that would be spread across five years “in order to limit the tax impact.”
So far so good. But the question is, will some employees, who will retire with their state pension and city health insurance benefits, along with vacation and sick time owed, be rehired as “part-time consultants” at $30,000 per year in addition to their pension?
A few are already employed in city hall under these terms-- they are the city clerk, the city grant writer and a former Code Enforcement building inspector. The maximum wages a city pensioner can earn by law if rehired by the city is $30,000.
A number of city hall insiders tell us that there is a clause in the retirement incentive program that essentially reads, “If you want to be hired back as a consultant you have to wait a year before being considered.”
However, there is a second clause that reads, “If you have special abilities that the city needs, the one year waiting period can be waived by Mayor Dyster.”
Will Dyster rehire chosen “incentivized” retirees back into city hall so they can make additional money as part time employees who will make their own hours?
You would think not, since this is the mayor who blames his budget deficit on the cost of labor. And rehiring the same person back, on top of the pension, would likely cost the city more money, defeating the purpose of the plan.
To explain a “retire and rehire” plan with real numbers, let’s say, just for the sake of argument, that Code Enforcement Director Dennis Virtuoso decided to retire this year.
We are simply using Virtuoso as an example since he is a public figure, an elected public official - county legislator and, despite being an acting-department head, he is a member of the steel workers union and therefore would qualify for the incentive plan.
We are not suggesting Virtuoso will retire, or, if he does, he would be rehired. It could be anyone or no one.
Tom DeSantis, who is the senior planner, is another department head who is a union member and could qualify for this incentive program. There are also several other city hall and DPW?union workers who would qualify and might be seen as essential employees by Dyster.
Will there be a later plan to offer incentives of a possibly slightly different nature to non-union department heads?
In any event, to simply explain how the program would work, in Virtuoso's case, his retirement payout would be based, like anyone else, on an average of his three highest salary years. Since he has averaged about $95,000 per year including his base salary, overtime, and stipend as Acting-Code Enforcement Director, with about 28 years into the retirement system, he can expect to be pensioned at about $63,000 per year, plus health insurance, plus another $20,000 courtesy of the Dyster retirement incentive.
If Virtuoso, because of his unique skills, would be offered the chance by Dyster to “retire and rehire,” he could retire from City Hall on Friday and return Monday, as a $30,000 per year “consultant.”
He could then set his own hours and earn just as much as he did without having to put in all that overtime.
The Reporter will be following Dyster’s early retirement incentive plan to ascertain whether it will play out as a “retire and rehire” plan, as we gather more information from city hall sources.
From there we can determine if there are any true savings.
Since all of this is public money, it is a service that we feel inclined to do- for the greater knowledge of our readers.