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Change to public employee annuities spurs exodus in Porter County

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A northwestern Indiana judge will lose a combined 67 years of experience this month when all three of his employees retire.

Porter Superior Court Judge Roger Bradford's executive assistant, bailiff and court reporter all are retiring Aug. 29, partly to avoid reductions in the amount of money they'll receive from their public employee retirement plan annuities, The (Munster) Times reported Sunday.

Executive assistant Julie Powell said she and her co-workers on Bradford's staff must leave now to avoid watching the returns on the annuity portions of their retirement plans fall from a guaranteed 7.5 percent to lower market-based rates under changes the Indiana Public Retirement System made nearly a year ago to reduce the possibility of unfunded liabilities.

The upcoming losses proved incentive enough to persuade the three court staffers to follow through on retirement plans even after Bradford surprised them by opting to seek a sixth term, which he'll begin in January.

"We said, 'Hey, we're in the mindset to go now,'" Powell said.

The Indiana Lawyer wrote about the pending change to the guaranteed interest rate in May.  Effective Oct. 1, the Indiana Public Retirement System will reduce the guaranteed interest rate for workers who choose to annuitize investments in their annuity savings accounts. Employees covered by the Public Employees’ Retirement Fund have 3 percent of their salary invested in those accounts and may elect to invest a greater portion of their earnings.

But the interest rate the state previously guaranteed on those annuities has proved to be unsustainable. NPRS says the change was needed because Americans are living longer and guaranteed rates of return on investment have fallen. The change has prompted units of government to alert workers about how their retirement benefits may be affected.

The loss of retirement money affects not just state and local government employees, but teachers as well. While there's no mass exodus among educators, some are calling it quits to avoid losing any money on their self-funded annuities. Teachers Dave Kenning and Judy Commers are retiring this year from the Porter County Career Center, taking with them more than 60 years of combined experience and institutional knowledge, said Jon Groth, the school's director.

Officials at the Indiana Public Retirement System project about 9,700 retirements in 2014 from the PERF and the Teachers Retirement Fund.

Porter County government is losing a total of 12 employees, including Porter County Treasurer Mike Bucko and County Highway Department Supervisor Al Hoagland.

Porter County Auditor Bob Wichlinski said he was unsure how many, if any, of the posts, will be left vacant in light of the County Council's call on departments in the financially strapped county to reduce their proposed budgets by 10 percent for next year.

The Porter County Public Library System is losing three employees to the PERF change, Director Jim Cline said. That's just 5 percent of the 60 full-time employees, but two of the three have worked for the library system for more than 22 years, he said.

The Valparaiso Police Department suffered a similar loss when an administrative assistant retired due to the PERF change and took 28 years of experience with her, Clerk-Treasurer Sharon Swihart said.

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  1. Thank you, John Smith, for pointing out a needed correction. The article has been revised.

  2. The "National institute for Justice" is an agency for the Dept of Justice. That is not the law firm you are talking about in this article. The "institute for justice" is a public interest law firm. http://ij.org/ thanks for interesting article however

  3. I would like to try to find a lawyer as soon possible I've had my money stolen off of my bank card driver pressed charges and I try to get the information they need it and a Social Security board is just give me a hold up a run around for no reason and now it think it might be too late cuz its been over a year I believe and I can't get the right information they need because they keep giving me the runaroundwhat should I do about that

  4. It is wonderful that Indiana DOC is making some truly admirable and positive changes. People with serious mental illness, intellectual disability or developmental disability will benefit from these changes. It will be much better if people can get some help and resources that promote their health and growth than if they suffer alone. If people experience positive growth or healing of their health issues, they may be less likely to do the things that caused them to come to prison in the first place. This will be of benefit for everyone. I am also so happy that Indiana DOC added correctional personnel and mental health staffing. These are tough issues to work with. There should be adequate staffing in prisons so correctional officers and other staff are able to do the kind of work they really want to do-helping people grow and change-rather than just trying to manage chaos. Correctional officers and other staff deserve this. It would be great to see increased mental health services and services for people with intellectual or developmental disabilities in the community so that fewer people will have to receive help and support in prisons. Community services would like be less expensive, inherently less demeaning and just a whole lot better for everyone.

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