EES board OKs study to review alternative retirement plan

By Thomas Wilson

STAR STAFF
twilson@starhq.com

     The Elizabethton Electric System Board of Directors votes Tuesday to ask their new auditing firm to review other retirement plans for system employees - including the Tennessee Consolidated Retirement System (TCRS). Board member Ken Wandell recommended the board pursue the review.
   "We can get our auditors to take a look at our pension plan and give us some additional information and with the TCRS, and any other (plan) they want to," Wandell told the board.  
   Several localities including the governments of Elizabethton and Carter County utilize the TCRS system for employees to fund their retirement pension dollars.
   The Tennessee Consolidated Retirement System provides retirement coverage to state employees, higher education employees, teachers, and employees of political subdivisions that have elected to participate in the plan. The board selected the Johnson City accounting firm of Blackburn, Childers and Steagall to audit their books in the January board meeting.
   Wandell and General Manager Phil Isaacs had done informal studies of the existing retirement plan covering electric system employees. A sagging stock market and its proportional affect on mutual funds and 401K plans has led to reconsideration. 
   "We don't need an unfunded, unknown potential liability out there," said Wandell of the existing pension plan.
   The system is managed under the state's Department of the Treasury. The TCRS is vested through domestic stocks and bonds, international stocks and bonds and short-term securities.
   Isaacs told the board the work would require an additional payout to the auditing firm for their pension plan review.
   A TCRS beneficiary may see his or her benefit increase each year with a cost-of-living adjustment (COLA) based on the Consumer Price Index (CPI) fluctuations. If the CPI is between .5% and 1%, the COLA will be 1%. If the CPI is between 1% and 3%, the COLA will be the actual percent. COLA provisions are optional, not required, by local governments.
   State sponsored insurance plans continue for a state employee covered by TCRS provided group I employees have 20 or more total years of employment with the state with one year insurance coverage under the state employee plan prior to termination. The period of time between the date of termination and date of retirement must be less than five years.
   A state employee cannot contribute to the state's deferred compensation plan after his or her retirement, according to the TCRS.
   The retirement plan covers all union and non-union personnel employed by the EES. The system's current retirement plan operates through the Massachusetts Mutual Life Insurance Company (MassMutual), and is administered by the Consolidated Service Associates. According to the TCRS regulations, retired state employees and teachers may retain insurance coverage under the group plan until they are Medicare eligible due to age. If a retiree becomes eligible for Medicare Part A prior to age 65, he/she must retain Medicare Part B to continue coverage under the group plan.
   In financial business, Isaacs also discussed the status of several capital projects with the board including a plan to initiate an electronic mapping system that could electronically diagram the entire system's service area.
   "We are to the point that I feel it is time for us to get into the 21st century with a computerized mapping system," Isaacs told the Board. The system tracks outages and service calls via a grid map of the entire service area. The grid overlay corresponds to several maps comprised of 415 pages - mostly with frayed edges - used by the service and maintenance division of the EES.
   "Our maps are getting really frazzled and worn," said Isaacs. "I hate to see us get further and further behind."
   Using global positions system (GPS) technology, the mapping system could track outages, flipped breakers and substations performance on a computer.
   Acquiring the system would involve a one-time cost of $50,000 for the software and technology, said Isaacs. The system could overlay the city's water and sewer infrastructure as well as natural gas and underground utility lines into the mapping system.