Oneida County Pays Off Amortized Retirement Payment Early
Picente says the law allows the payments to be spread out over ten years, but by making amortized payments in one year instead of ten, the County saves taxpayers almost a million dollars in interest payments on the retirement plans.
“Amortization has been one of the most effective tools to relieve county taxpayers from mandated retirement payments to the State," Picente said. "Our total retirement bill for 2014 was $13,818,157, we paid $8,402,101 and we amortized the rest. The only practical thing to do is spread some of the payment out over time and pay the loan off as quickly as possible, we have done that and saved the taxpayer’s nearly a million dollars.”
By amortizing the payments - or paying on both the interest and principal of the retirement plans, Picente says they are able to avoid raising property taxes 7 to 10% each year since 2011.
“If we did not amortize portions of our retirement bill we would have had to increase property taxes 7% to 10% each year since 2011, on every taxpayer and business in the County," Picente added. "Anyone who tells you different doesn’t understand public finance or our fiscal realities. Amortization is not only the right option it’s the only option. I thank my partners in Government, Joe Timpano and the Board of Legislators for agreeing with my approach.”
Oneida County's total retirement payment is $58,015,009 since 2011. In the past four years and 2015, Oneida County will have amortized $18,235,034 which has been paid down to $8,580,629.