Harford County Executive David Craig said Wednesday he will offer a retirement incentive to cut the county government's workforce and save money.
Craig said in a statement he will submit legislation to the Harford County Council seeking its approval for funding a one-time retirement incentive program for county employees. Some employees, such as sheriff's deputies, won't be eligible.
Among the benefits included in the package as proposed is payment for 100 percent of an employee's accrued sick leave balance. Under ordinary retirement, an employee is entitled to a 50 percent payout of sick leave.
"As the administration is working on the preparation of the FY 15 Budget, we have analyzed and assessed many alternatives to balance the budget given our flat revenue projections. One alternative is to reduce the county's workforce through attrition to include retirements," Craig said. "As a result, I have made the decision to, with Council approval, implement a one-time retirement incentive program for county employees."
Craig, a Republican, is a candidate for his party's nomination for governor.
The purpose of the incentive package is to reduce expenditures by reducing the workforce through attrition. The effort comes at a time when Craig has said county government revenues are expected to grow only by about $7 million in for the new fiscal year that begins July 1. Harford's approved operating budget for the current fiscal year is $640.4 million; its capital budget is $174 million.
Over the past three years, Craig has received criticism from teachers and other school system employees, as well as some segments of the public, for his refusal to meet funding demands from the county board of education. The school system tentatively plans to seek a $33 million increase from the county for its next budget, which some county officials have privately said is untenable.
The cost and any resulting savings from the buyout incentive package will depend on the number of employees who participate. The county, however, estimates the incentive package will cost $2 million in additional funds but will save an additional $4 million through the first six months of the new fiscal year.
The offer applies to county employees whose agency is under the direct control of the county executive, which excludes deputies, correctional officers and other employees of the Harford County Sheriff's Office and employees of the Harford County Public Library. School system employees are also excluded.
County employees who decide to retire under the incentive program must make their irrevocable intent to retire known to the county human resources department by March 7 and must retire by July 1.
"We are just looking to show that we are looking to save money on our side of the government," Craig explained in a follow-up interview.
He said each county department will have to cut its budget by at least 2 percent next fiscal year; however, the total reductions could be as much as 5 percent.
Fewer people have been retiring during the economic recession, he noted.
"This would probably ramp it back up again," he said of the offer and the likelihood more people will retire than would be expected.
The plan announced Wednesday is similar, but not identical, to one Craig offered in early 2010, leading up to the 2010-11 fiscal year.
More than 240 employees qualify for the offer, and Craig said he expects about 30 percent of those eligible to take it, based on the 2010 experience.
He said every department that can participate has at least one employee who qualifies, with the smaller agencies having fewer who qualify.
In 2010, 53 employees took the offer, including Lorraine Costello, who was director of administration, and John Scotten, who was county treasurer, both members of Craig's cabinet. The Sheriff's Office employees were part of the 2010 program.
This is Craig's final year as Harford's chief executive, a post he has held since mid-2005. His term ends in early December.