No announcement yet.

Bonita Springs--Accounting Error Shorts Retirees

  • Filter
  • Time
  • Show
Clear All
new posts

  • Bonita Springs--Accounting Error Shorts Retirees


    Fire board tries to fix accounting mistake

    Old error leaves five employees short on their retirement pay

    By DENISE L. SCOTT, [email protected]

    A 24-year-old bookkeeping error could cost five San Carlos Park Fire Protection & Rescue District employees some of their hard-earned retirement money.

    Fire Chief Nat Ippolito said the district hired its first paid employee, former Chief Karl Drews, in 1979. The bookkeeper at the time thought the money being contributed to the state for Social Security and workers’ compensation was also going toward the Florida Retirement System.

    It wasn’t.

    Drews discovered that the district had no retirement plan in October of 1984.

    “It took until January of 1985 to resolve it, get us enrolled and purchase past service” credit, Ippolito said.

    Employees hired after that date were not affected by the mistake.

    In addition to the five employees hired between 1983 and January 1985, the fire district board posthumously purchased Drews’ past service to make up for lost benefits. The rate for all six employees was 2 percent of each year’s salary.

    All was fine until 2000, when the state legislature retroactively boosted service credits from 1983 to 1988 to equal the 3 percent of annual pay given in 1989 and after.

    That means that after 25 years on the job, a person would earn 75 percent (25 x .03) of his full pay as retirement pay.

    The retirement system determined that the five San Carlos employees who purchased past service credits didn’t qualify for the retroactive increase to 3 percent, Ippolito said.

    “If we would have been placed in the retirement system upon our hire date, we would get 3 percent,” Ippolito said. “The board did everything it could legally and correctly to try to correct it. The retirement system said that’s all we can get.”

    Depending on hire dates, those five employees will lose between $50 and $1,000 each year of their retirement if the discrepancy is not corrected, Ippolito said.

    “The board put together a one-man committee to establish what losses there really are and what to do about it,” he said.

    That man is District Commissioner William Elliott, who is researching annuity investment options to make up that lost 1 percent on the advice of district attorney Terry Lewis.

    “We’re making up the difference the state would not allow us to make up,” Elliott said. “We are talking about taxpayer dollars, so we want to make sure they are spent judiciously.”

    Elliott said taxpayer money would have paid for that 1 percent years ago.

    “It’s going to cost more now,” he said, referring to the as-yet unknown total to be invested.

    Ippolito said Elliott will give the board a recommendation at a public meeting prior to the September budget meeting so that the investment expense can be included in next year’s budget if necessary.
    09-11 .. 343 "All Gave Some..Some Gave ALL" God Bless..R.I.P.
    IACOJ Minister of Southern Comfort
    "Purple Hydrant" Recipient (3 Times)
    BMI Investigator
    The comments, opinions, and positions expressed here are mine. They are expressed respectfully, in the spirit of safety and progress. They do not reflect the opinions or positions of my employer or my department.

300x600 Ad Unit (In-View)


Upper 300x250