Decatur’s retired city employees will go without a state-authorized bonus of up to $600 after the City Council this week rejected it, with councilmen saying retirees knew what their pension would be when they retired and were already compensated for their work.
The council voted 3-1 against the proposal to make the lump sum payment of $252,030 to the state Employees' Retirement System that would have then been paid to retired city employees based on service time with a $600 maximum. Councilman Hunter Pepper was absent from Monday's meeting.
In the spring session, the state Legislature passed a law that gives state retirees a bonus of $2 for every month of service in the state system. Retirees from municipal and county governments would qualify for the same bonus if their governments vote to fund it.
In urging the council to approve the payment, retired police officer Mike Hazel said many of the people stayed with the city as employees “when we could have gone somewhere else and made more.”
Hazel, an 11th Street Southeast resident, told the council that they endured a number of years without pay increases, particularly after the 2008 recession.
“That ultimately affected our retirement pay,” Hazel said.
Retiree Sammy Foster, who worked as an equipment operator in the Street Department, said he deserves a bonus because “we (retirees) made many sacrifices for the city.”
Foster pointed out the city used to pay for retirees’ health insurance until they quality for Medicare, but the council reduced the city’s share to 87%.
“We haven’t had a raise in a long time and then y’all went and took 50 more dollars out of my checking account,” Foster said. “I’m on a set budget. My wife retired. I manage every day.”
Foster said he and his co-workers in Public Works “worked that dirt” at the Aquadome Recreation Center and Brookhaven Middle School. The city, along with Morgan County and Decatur Utilities, last year received a $98.4 million legal settlement with 3M Co. over the dumping of toxic waste. Some of the waste was allegedly placed in a municipal dump at the Aquadome-Brookhaven property.
“Y’all get the benefits from the settlement and you’re telling me I can’t get the benefit of $600?” Foster said to the council. “That’s just like you’ve got a dog in your yard that runs and protects you, does everything you want him to do, and you won’t even give him a bone.
“Every one of the city employees I worked with worked hard.”
Foster said then-Mayor Bill Dukes recognized him and his co-workers for working through the night to protect the Princess Theatre Center for the Performing Arts and in other areas of the city during a major flood.
“So now you’re going to tell me we ain’t worth $600?” Foster said.
Councilman Billy Jackson, who voted for the bonus, said the retirees deserve it. He said many retirees worked for less pay during their city employment because of the attractive benefits package, and they “haven’t received any sort of raise since 2007."
“It’s important to realize that retired employees invested so many years for the city. We’re not where we are without the retirees,” Jackson said.
Council President Jacob Ladner said he’s learned that government retirees are different from retirees in the private sector where “you’re not going to get any help at all.” He pointed out that most people have been taking a hit with their 401(k) retirement accounts this summer.
Ladner said the city can afford the bonus, so the decision “is more about policy or principle,” and he agreed that city employees get paid less than they would in the private sector.
Ladner said the council didn’t approve a pay raise for city employees with American Rescue Plan Act funding like other cities did for the same reason he opposes giving tax revenues to retirees.
“We would be giving money to a select group of people — something about that violates my principles,” Ladner said.
Jackson countered that the council is willing to spend $10 million on the Sixth Avenue streetscape and $10,000 on a Christmas tree for City Hall.
“Those projects don’t benefit many of the city’s residents,” Jackson said.
Ladner disagreed: “The Christmas tree and streetscape are projects that everyone has the opportunity to enjoy.”
Mayor Tab Bowling asked Chief Financial Officer Kyle Demeester how many of the city retirees live in Decatur, and Demeester said 55% of the retirees have city addresses.
Bowling also asked how current employees fared in a recent market study, and Human Resources Director Richelle Sandlin said the study shows Decatur is behind other city’s municipal employees’ average pay. She did not have specific numbers available.
Councilman Kyle Pike said he waffled on this decision and he wasn’t sure going into the meeting how he would vote.
“One of the biggest things is our current employees’ pay,” Pike said. “It’s tough giving retirees a bonus when we know our current employees need to get up to market pay.”
Councilman Carlton McMasters said the city had a budget surplus last year, “but we’re also seeing record-level inflation which is driving up the price of literally everything we purchase. We aren’t sitting on buckets of cash and fuel is at a record high. We’re seeing increased costs across the board.”
McMasters also said he doesn’t know of any private sector business that provides bonuses or cost-of-living raises to retirees.
“Yes, they worked for the city and they were compensated for it, but they knew their pension when they retired. Everyone is dealing with inflation,” he said.
McMasters said the city has too many needs to approve a bonus for retirees. Among them, he said, are improving current employees’ pay, increasing beautification efforts through mowing and litter pickup, buying new firetrucks, loader trucks and other city vehicles and increasing the amount of paving in the city.
“Out of the above list of needs, some critical, what gets omitted if we do this?” McMasters said.
McMasters said Montgomery is the only one of the state’s 10 largest municipalities that has approved the bonus.
Morgan County Commission Chairman Ray Long on Wednesday said the commission approved the bonus for its retirees in June.
“We always give bonuses to retirees (when the state approves one),” Long said. “We have a good record of supporting retirees.”
Athens Mayor Ronnie Marks and Hartselle Mayor Randy Garrison said their city councils have not yet considered the retirees' bonus.
Demeester said the deadline for a city or county to let the state know that it plans to pay the bonus is Aug. 31.