Michele Madigan likely will not be retiring under the state retirement system when she steps down as the Saratoga Springs Commissioner of Finance in January. This, despite the resolution passed by the city council Tuesday evening Dec. 7. In that vote, the council made changes that will allow Madigan and commissioners who follow, to have health insurance benefits in perpetuity.
Under the state’s retirement system, Madigan will have less than the requisite 10 years of employment history needed to claim retirement benefits when January comes, even though she has been in office, and an eligible employee in the system, for 10 calendar years.
“What [the city council] did tonight has no effect on their standing in the state retirement system,” the city’s attorney, Vince DeLeonardis, said after the vote. “That’s all up to New York State.”
However, she will be able to receive the city’s health care benefits for the rest of her life because of the vote. The city’s health insurance is not part of the state retirement package, DeLeonardis explained.
[See the coverage yesterday, here.]
In a story yesterday, that many news outlets picked up, the discussion of just what a “week” was became the focus, but the real focus should have been on the differentiation between the two systems.
The retirement benefits the city offers are health insurance and group term life insurance, DeLeonardis said. All other retirement comes from the state. The state’s definition of a week, which remains unchanged, is "minimum wage multiplied by 2,000." The state's current minimum wage is $12.50 per hour.
Under that formula, the commissioners, at $14,500 a year, are not working full time, but about 58% of a week. Therefore, they accrue much less than one week of time in the New York State Retirement System for each week they spend on the council.
Commissioners who have been on the council long enough will accrue 10 years in the state retirement system, even though they have been on the council many years more.
“What you need to retire with the state of New York is still up to the state of New York. This [vote] did not affect that,” DeLeonardis said.
The vote by the city council divorced the state’s definition of a week from the city’s health care benefits rule.
Approved Tuesday evening was a resolution that redefined retirees “as persons who have served the City of Saratoga Springs as a member of the City Council for at least ten (10) consecutive years, who have reached at least fifty-five (55) years of age, and who were working at their Standard Work week for the City of Saratoga Springs at the time of departure from City service.”
The “standard work week” is 33 hours per week at $14,500 per year for commissioners and the mayor. No other employees fit under this rule.
Although the rule applies to elected officials in the future, the only person it affects today is Madigan.
One person, Kristen Dart, spoke against approval during public comment, despite also saying that Madigan “has given great service to the city.” Dart served on the Police Reform Task Force, appointed to the role by Madigan.
“To change the rules to benefit one person seems like an injustice," Dart said. "If any other employee of this city did not qualify for benefits under the retirement provisions, they would be denied those benefits.” Dart said.
In the end, the vote passed. Madigan did not run for office in November. Minita Sanghvi will become the finance commissioner in January.