Mayor Neal Schwieterman noted in his opening remarks about the proposed new retirement plan that "after a thorough review" by Barbara Peterson, town clerk, and Cindy Jones, finance officer, the plan is beneficial to employees. His remarks were made during the July 9 Paonia Town Council meeting.
Larry Wissbeck, trustee, commented that when the council had chosen Mutual of Omaha it was under the impression that the company would bring the town into compliance with the federal government for a few hundred dollars. "It turns out they didn't know what they were saying," Wissbeck said. "It's likely to cost us as much as $4,000." He said that figure is comparable to any of the other proposed plans. He also noted that Jones has told him there are ways to accomplish compliance for less money and she is pursuing those options.
Ross King, trustee, asked the trustees if they had reviewed the Meslrow agreement and what Jim Briscoe, town attorney, had outlined in his memorandum. He challenged the other trustees saying there wasn't any way any of them could have read the Meslrow agreement referenced in Briscoe's memo because it was never given to the trustees. "I'm not supporting this," King said later in the discussion.
Corinne Ferguson, trustee, was absent but submitted a letter to the council to explain the proposed retirement plan for town employees. In that letter she wrote, "Meslrow is part of Mutual of Omaha's three-tier support plan for the town. They will provide an analysis of the retirement plan to make sure that town liability is being managed correctly while making sure the retirement plan is effective for the employees. On behalf of the employees they analyze the fee scales, plans, investments, etc. and send a separate quarterly report to the employees advising them of their current status as well as hints and ways to improve the return on their investment. They are not paid by the town, but by Mutual of Omaha."
She further explained that Dolly Schaub of New England Financial will provide basically the same service as Meslrow, evaluating the retirement plan at no cost to the employees.
The Town of Paonia is the plan sponsor and administrator, with Jones being the administrator on behalf of the town. Mutual of Omaha will provide Jones with fiduciary support and consultation "at the product, plan and participant levels."
Trustee Eric Goold said he was satisfied with Ferguson's letter. He asked Jones why the town was not in compliance.
"It's with the IRS. The proper documents were not filed timely and have not been filed for some time so we need to get that current before we can terminate and roll it into a new plan," Jones said. She explained that the old retirement plan only allowed donations from the town, while the new plan will allow employee contributions as well.
Mayor Schwieterman said when he resigned as a police officer with the town 10 years ago, "to say it was an unsatisfactory experience would be vastly understated." He found the current retirement plan's customer service "very difficult."
Goold asked if the proposed new plan is the one the employees want. The mayor said it was.
Pete Blair of Blair and Associates said the new plan would be a win-win situation for the town and its employees because employee contributions would be pre-taxes.
The new retirement plan was approved on a split vote with only King in opposition to its adoption.blog comments powered by Disqus