Hempstead sees $6 million savings in early retirements

Hempstead Town officials say they're likely to save Hempstead Town officials say they're likely to save about $6.51 million this year after 71 full-time employees took advantage of an early retirement incentive program. Photo Credit: JC Cherubini

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Hempstead Town officials say they're likely to save about $6.51 million this year after 71 full-time employees took advantage of an early retirement incentive program offered for the third time.

The town board in December approved the retirement incentives with the Civil Service Employees Association Local 880. Union members had until Feb. 28 to decide to accept the buyout that would reduce the town's workforce to about 1,900, which remains the largest town employee base on Long Island.

"The oldest employees have the largest salaries and we have the largest contributions toward their retirement," said Supervisor Kate Murray. She added the town contributes 25 percent toward high-tier employees' pensions, compared with 10 percent for new employees.

The buyout agreement will pay employees up to 20 percent of their annual salary. Payments would be made by March 26 or 30 business days after the employee provides proof of early retirement.

Dozens of long-term employees leaving the town "should allow for some new hires at entry level, a few promotions to fill critical vacancies and still provide long-term savings to the taxpayer," CSEA Local 880 president Charles R. Sellitto said in a statement.

Other municipalities have offered buyouts. Last month, Oyster Bay officials extended the town's employee retirement incentive program for a third year. In January, the Glen Cove City Council approved a plan to pay civil service union members to resign or retire as part of a voluntary separation program.

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In Hempstead, the total severance incentive payout to employees, with an average salary of $100,490 and 33 years of employment, would be about $1.41 million. The highest payout would be $31,141, the lowest $1,589 for an average of $19,581, town spokesman Michael Deery said. The funds would come from the salary budget, Deery said.

Buyout employees will receive separation pay for accrued sick time and vacation time. They will also receive medical and pension benefits for life, Deery said.

Overall, the town would save $4.64 million in salary payments, $100,000 in medical coverage and $1.77 million in pension costs, Deery said. In 2009, about 52 employees took advantage of a similar retirement offer, he said.

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Felix Procacci, a frequent town board critic from Franklin Square, said Murray has reduced the town's workforce by 5.5 percent since 2003, but town property taxes have still increased 44.9 percent. Procacci, who has attended 75 consecutive town board meetings, unsuccessfully ran for town supervisor as a Democrat last year.

"Until town government provides residents with real transparency, there is no way to determine whether the employee buyout will be a positive for taxpayers," said Procacci. He said he has been requesting that officials put the town's comprehensive annual financial reports online.

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