THIBODAUX — Changes could be coming for the city of Thibodaux’s retirement system, the cost of which has ballooned in recent years.
The Thibodaux City Council signed onto a letter with other municipalities asking the retirement system’s state overseers to investigate cost-saving measures for the programs that account for more than $1.6 million of the city’s budget.
“People who are in there now have a right and deserve what they have earned,” Eschete said. “At some point we may have to draw a line in the sand for new employees.”
The city participates in two programs to provide retirement for employees — one for police and one for other employees, Eschete said.
In both systems, the employer and employee contribute a percentage of the worker’s salary. The percentage is set by the boards of elected members and appointees.
Eschete said the percentage the city contributes has increased in recent years.
“When I started in 1983, the employee contribution rate was 9.25 percent, and the employer was about 5.5 percent,” Eschete said. “Today the employer pays 18.75 percent, and the employee pays the same rate (as it has been).”
Since 1996, retirement expenses for the city have gone from about $200,000 to its current $1.6 million for both programs combined. The police program saw a sharp upward swing from 2009 at $200,000 cost to the city to its current amount of about $850,000.
Eschete emphasized he will seek no action that would change the system for current employees.
He noted he might have to consider doing something different for new hires although the current system is a good recruiting tool for prospective employees.