AAC County Lines
County Lines [(ISSN 2576-1137 (print) and ISSN 2576-1145 (online)] is the official publica- tion of the Association of Arkansas Counties. It is published quarterly. For advertising inquiries, subscriptions or other information, please con- tact Christy L. Smith at 501.372.7550.
Executive Director/Publisher Chris Villines
Communications Director/ Managing Editor Christy L. Smith
Communications Coordinator/ Editor
Holland Doran AAC Executive Board:
Debbie Wise – President Brandon Ellison – Vice President Rhonda Cole – Secretary-Treasurer
Tommy Young Debra Buckner Kevin Cleghorn Debbie Cross Ellen Foote
John Montgomery David Thompson
Terri Harrison Sandra Cawyer Terry McNatt
Brenda DeShields Jimmy Hart Marty Boyd
National Association of Counties (NACo) Board Affiliations
Debbie Wise: NACo board member. She is the Randolph County Circuit Clerk and presi- dent of the AAC Board of Directors.
Brandon Ellison: NACo board member. He is the Polk County Judge and vice-president of the AAC Board of Directors.
Ted Harden: Finance & Intergovernmental Af- fairs Steering Committee. He serves on the Jefferson County Quorum Court.
David Hudson: Chair of NACo’s Justice and Public Safety Steering Committee. He is the Sebastian County Judge and member of the Rural Action Caucus Steering Committee.
Barry Hyde: Justice and Public Safety Steering Committee. He is the Pulaski County Judge.
Gerone Hobbs: Membership Committee. He is the Pulaski County Coroner.
Kade Holliday: Arts and Culture Committee and International Economic Development Task Force. He is the Craighead County Clerk.
Paul Ellliot: Justice and Public Safety Steering Committee,
vice-chair of law enforcement
subcommittee. He serves on the Pulaski County Quorum Court.
Ellen Foote: Community, Economic & Work- force Development Steering Committee. She is the Crittenden County Tax Collector.
Tawanna Brown: Telecommunications & Technol- ogy Steering Committe. She is the Crittenden County Chief Computer Operator.
COUNTY LINES, FALL 2019
The state of state retirement
stable, and the potential for many years of steady work (save being unelected) exist in a world that doesn’t change too much. But county government is not usually financially rewarding.
mployment in county government can be an in- credibly rewarding career. Opportunities to help on a local level abound, and the satisfaction of being a public servant can be fulfilling. Jobs are usually
Chris Villines AAC
Fiscal rewards come to those in the civilian world more often than they do to those in government. Christmas bonuses are unheard of, and raises don’t move the salary needle very often. Tis systemic shortfall was acknowledged years ago by our state. In order to some- what equalize the playing field between public and private sector jobs, our state cre- ated the Arkansas Public Employee Retirement System (APERs). Tis defined benefit plan sought to reward long-standing career employees with a benefit at the end of their careers. It has helped to attract and retain employees since its inception. Defined benefit plans base a post-career annuity based on a formula of salary and
years worked. Tese systems incur some risk because the annuity doesn’t change re- gardless of the market value of investments. Most government pension plans remain defined benefit plans like ours. In addition to government pensions, the world’s largest defined benefit plan is something we all have access to: Social Security. Alternatively, defined contribution plans pay out only what is put in, plus or minus
interest gained or lost, over time. Defined contribution plans incur no risk to the em- ployer, instead shifting all risk to the employee/investor. 401(k) plans (or the 457(b) (3) — the government equivalent) are the most common defined contribution plans. APERs has been under incredible scrutiny over the last couple of years, and
several bills filed in the 2019 session could have made significant changes in how APERs functions. Ideas such as raising the contribution rate, decreasing the mul- tiplier used for the formulaic calculation, lowering the final average salary, and low- ering the cost of living increase for retirees were all met with immediate opposition from state, county and city employees. While changes may come in the future, I would like to thank state Sen. Bill
Sample and state Rep. Les Warren for their leadership as co-chairs of the Legisla- tive Joint Retirement Committee. Tey, along with many committee members, believed that a measured approach to change, along with APERs member input, was necessary before any major modifications were made. As a result, this commit- tee met 12 times around the state over the last four months. Much has been learned in this round-robin exercise. We’ve learned that APERs
is around 79 percent funded. Tis means if the system (1) no longer gained new members; (2) hit its target investment rate; and (3) paid out all members already in the system who retire into the future, the amount of money would fall short of that amount needed to fulfill retirement obligations. While not funded in full at 100 percent, this 79 percent level still places APERs roughly in the top third of retirement systems similar to ours in the country. Philosophies of how much a system like this needs to be funded run along a
spectrum, and some believe the only healthy system is one that is 100 percent funded, while others are comfortable at a number less than our current 79 percent — after all, the scenario of nobody new coming into the system is not plausible.
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