Atlanta police, firefighters and other city employees will contribute an additional 5% of their annual salary toward their defined benefit pension plans, effective Nov. 1, under legislation passed Wednesday night by the Atlanta City Council.
Current employees will now contribute from 12% to 13% of pay to their pension plans.
Employees hired on or after Nov. 1 will be required to contribute 8% of their annual pay to their DB plans and will also be placed in a hybrid 401(k)-type plan with a 3.75% mandatory contribution and a 100% match by the city. They can contribute an additional 4.25% to the hybrid plan that will also be matched by the city, according to a statement by the office of Mayor Kasim Reed.
The city's DB plans will not be terminated.
The bill also increases the retirement age for newly hired general city employees to 62 from 60 and to 57 from 55 for police officers and firefighters.
The pension overhaul bill is expected to save the city $25 million annually, according to a statement by Mr. Reed.