FINANCIAL BUSINESS REQUEST (FBR)
Motion/Request:
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MOTION to approve a proposed "Amendment 2025-1 to the Town of Ledyard 401(a) Plan" Pertaining to Employees eligible for Matching Contributions; as presented by the Retirement Board in the draft dated March 18, 2025.
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Background:
Retirement Board March 18, 2025 Meeting: The Retirement Board has recommended the Town Council approve a proposed "Amendment 2025-1 to the Town of Ledyard 401(a) Plan" Pertaining to Employees eligible for Matching Contributions; which would allow town employees to receive matching contributions under the Defined Contribution (DC) Plan; after being retired by the Town and being rehired. (Please see attached memo dated 3/18/2025)
Amendment 2015-1 to the Town of Ledyard 401(a) Plan as Amended and Restated January 1, 2014 stated that employees who retired from the Town and were rehired were NOT eligible to receive matching Contributions under the Plan.
The proposed Amendment 2025-1 would remove the following paragraph:
"Employees who were participants in or drawing benefits from the Retirement Plan for full-time Employees of the Town of Ledyard (Defined Benefit Plan) who are rehired are NOT eligible for Matching Contributions under the Plan".
Additional Background:
The Retirement Board has been in discussion regarding Attachment 1 and its impact on retaining skilled/experienced workers in town employment after they have reached Normal Retirement Age under the Defined Benefit Plan. It is the Retirement Board's consensus that Attachment 1 is detrimental to this effort. These individuals have a minimum of 12 years' experience in their positions, which makes them valuable to the town especially in a difficult hiring environment. It should be noted that with their experience, these individuals could easily go to a nearby town where they would get both Ledyard's retirement benefits, compensatory salary/pay and likely a Defined Contribution plan with a Matching Contribut...
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