Retirement numbers not adding up at City Hall

Frederick mayor calls for external financial review of incentive program

Holtzinger (R) said on Friday that since Angel left his post unexpectedly on July 14, Director of Finance Gerry Kolbfleisch has been reviewing data from the city’s actuarial and legal consultants, but ‘‘can’t replicate [Angel’s] numbers.” Holtzinger said it is ‘‘a disturbing issue ... since we are talking about a lot of money.”

Angel did not return calls seeking comment by The Gazette’s Wednesday deadline.

In advising aldermen about the plan, Angel had stated if 67 of the 77 eligible employees accepted the buyout, the city would save $1.5 million in the current fiscal year, and see savings of $23.4 million during a 30-year period.

On Friday, Holtzinger (R) announced that in addition to an internal review by the city’s Finance Department, he is calling for an ‘‘independent external financial review” of the retirement program, of which 67 employees took advantage. Employees already beyond their retirement date or those who would be by 2013, were offered two years’ salary and benefits in return for retiring this year. Fifty-four of those employees left their jobs June 30.

Aldermen Marcia A. Hall (D), Alan E. Imhoff (R) and David ‘‘Kip” Koontz (D) all voted in favor of the program in April. Aldermen C. Paul Smith (R) left the meeting early after indicating he was in favor of the plan and Alderman Donna Kuzemchak (D) did not attend as she was recovering from surgery.

In recent weeks, the aldermen have raised numerous questions about the way the plan was administered.

‘‘[The approval] was based on staff saying it was worthwhile and in [the aldermen’s defense], they only know what is presented to them,” Holtzinger said. ‘‘... It will be interesting to see what comes out [of the reviews]. I don’t know the numbers given to the consultants and the board relied on what they were being told.”

Last week, Imhoff called for an internal review of the program and an external review, if warranted. On Monday, he said he hopes the mayor’s call ‘‘puts all the concerns about cost to rest.”

‘‘Even I took things for granted,” Imhoff said. ‘‘I assumed when we voted to go ahead, details would be forthcoming and the city’s retirement plan committee, of which I am a member, never saw this. I and my dumb stupidity, having dealt with plans like this firsthand ... made the assumption the plans were the same.”

Imhoff accepted an early retirement package in 1998 from his employer, AT&T.

Imhoff said that for him, the city’s retirement program was never about cost savings, but it was a chance to look reorganization or promotions at City Hall.

If the savings to the city don’t equate with Angel’s estimates, Imhoff said ‘‘it won’t bother me.”He feels the city’s retirement fund has enough to support any shortfalls.

‘‘Am I really concerned? No. Could this have been handled better? Yes,” Imhoff said. ‘‘... Is there one person at fault? No. Is there a conspiracy? Definitely not.”

Kuzemchak has asked local professionals to review details of the plan for her, and passed along their thoughts to the Finance Department. She said the mayor’s call for review is a little late.

‘‘At this point, it is an absolute necessity,” she said. ‘‘Should the taxpayers have to go through this again? No. It should’ve been done first ... Someone in the city who wouldn’t directly benefit should’ve looked at this first before any information came forward.”