SAGINAW, MI Saginaw City Council on Monday, Dec. 8, approved a change to the pension plans provided to city police officers.
The new “hybrid plan” adopted by City Council Monday is permitted under the new police officers’ union contract approved by Council on Nov. 10.
Currently, Saginaw police officers are offered a “defined contribution” retirement plan, where the city contributes 13 percent of the officer’s pay into the plan and the employee contributes 8 percent.
The new plan will feature two parts: a defined contribution portion and a defined benefit portion. The city’s contribution will remain capped at 13 percent of the employee’s salary and the employee will be responsible for any future cost increases, meaning the financial impact on the city will remain the same.
There are two things that city staff hope the change will accomplish.
According to a memo submitted to City Council, the new plan is intended to improve both recruitment and retention efforts.
“Police applicants may be more inclined to consider working for an employer with some form of a defined benefit plan and employees are more apt to work through normal retirement age of 60 with this benefit in place,” the memo reads.
All eight members of City Council present for the meeting Monday voted in favor of making the change.