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Kissimmee commission votes to adopt 401(a) retirement option for elected officials
Summary
The City Commission approved a 401(a) defined-contribution retirement option for commissioners (option B), with staff recommending city contributions equal to 21% of salary and a vesting requirement of at least one term.
The Kissimmee City Commission voted unanimously to approve a recommended retirement option for elected commissioners, adopting a 401(a) defined-contribution employer-sponsored plan (option B).
City Manager Mike Steigerwald briefed commissioners on the recommended plan, explaining it operates similarly to a 401(k) but is a 401(a) because it is a public-sector employer-sponsored plan. He said city contributions would be discretionary and proposed that the city contribute an amount equivalent to what the city contributes to the employee pension plan — 21% of salary — with the commission setting the vesting schedule. Steigerwald recommended a vesting requirement of at least one full term.
Steigerwald outlined other plan features: funds may be withdrawn without penalty after age 59; withdrawals before age 59 may incur a 10% penalty; city contributions would be pretax dollars; and members would choose investment options. He contrasted the new option with joining the general pension plan, which he said would require an elected official contribution of 3.69% of salary to roughly match a 21% city contribution.
Vice Mayor Eady moved to approve the recommended option; Commissioner Martinez seconded. The commission voted “Aye” and the motion carried.
Votes at a glance: - Consent agenda (motion by Commissioner Martinez; second by Vice Mayor Eady): approved unanimously. - Retirement benefit adoption — 401(a) defined-contribution plan (motion by Vice Mayor Eady; second by Commissioner Martinez): approved unanimously.
The city manager also noted that Kissimmee is among the few elected bodies in the Central Florida area that previously did not offer retirement benefits to elected officials and that other nearby jurisdictions have adopted such benefits.
