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College Park to Join State Pension Plan in July

MD State retirement system

MD State retirement system

Last summer, the City Council voted allowing the City employees joining the Maryland State retirement plan (5-3, Catlin, Wojahn and Kabir opposed)

Currently, the City employees contribute to a plan called 401A plan, which is a defined contribution plan. In this plan, the City makes a 6.5% contribution to all employees towards their retirement. The contribution is invested in mutual funds with a vesting period of 5 years. The current 401A plan does cost the employee nothing.

According to City’s Human Resource department, so far 80% of employees have expressed interest in joining the plan. City will be joining the Maryland State Retirement and Pension System as of July 1, 2014! The HR is still waiting for a few more voters.

The enrollment process for the plan will start in early April.

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2 Comments to “College Park to Join State Pension Plan in July”

  1. By Kevin Young, March 8, 2014 @ 11:39 am

    Fazlul,

    Could you clarify what becomes of the current 6.5 city contribution to the 401A. Would that plan continue, or, will the city contribution go to fund the defined benefit pension? You say that 80% of employees are interested in joining the plan. Is joining the plan optional for employees?

    K Young

  2. By Fazlul Kabir, March 8, 2014 @ 6:14 pm

    Kevin, Thanks for your comments. As far as I know the existing plan will be be replaced by the SRP. And yes, it’s optional for our employees to take part in the plan.