Fulton County paid 177 retirees $2.1 million in back pay after they challenged the county for shorting them on their pensions.
At the same time, an audit triggered by the complaints found that the county was over paying nearly twice as many retirees. As of May 1, their pension benefits were reduced, though they will not have to return any money that was paid to them.
All told, the settlement with the Fulton County Defined Benefit Plan actually ended up saving money for the county.
That reduction in retiree payments will save more than $252,000 a year for the plan, for an expected savings of $6 million over the plan’s life. The pension plan, which has about 4,000 participants, stopped accepting new members in 1999.
“The bottom line is on this crazy thing, it actually benefited the plan,” said Gary Stiles, the Fulton County chief of police and chairman of the board of trustees for the retirement system. “More people lost money with this audit than actually gained money.”
The audit stemmed from an earlier lawsuit, in which 2,107 retirees received nearly $17 million in back pay from the county.
The issue stemmed from the county’s switch from monthly to bi-weekly paychecks, because some years had 27 paychecks instead of 26. When payroll made the switch, Stiles said, no one thought about the future impact it would have on pension calculations.
The county’s insurance, Stiles said, covered the payouts. The fund is about 76 percent funded and “in good shape,” he said.
Of the settlement, $632,070 went to attorneys’ fees and $655,823 covered expenses. On average, pension payments will increase for 150 retirees by $35.61 a month.
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