Due to a mistake the State of Maryland
made, it’s going to cost Emmitsburg residents a lot less to ensure that
full-time town employees are part of the Maryland State Retirement and Pension
For the past two years Emmitsburg has been
paying the state tens-of-thousands of dollars to make sure that all full-time
employees would benefit from the state pension plan and they would have kept on
overpaying that debt had the mayor and town commissioners not decided to pay
down the debt.
Initially Emmitsburg thought they owed the
state $440,643 to enroll in the pension plan. This amount covered what the town
would have paid to have its employees enrolled in the plan since each employee
started working for the town. That amount plus interest was divided over 25
years of payments for the town. Two payments have been made so far totaling
But a recent review by Town Clerk Donna
DesPres uncovered a huge blunder – Emmitsburg only owed the state $201,167,
less than half the original amount thought.
That discovery changed quite a few things
for the town. Instead of having to make a $38,921 a year payment to the state
for 23 more years, the town was put in the position to pay the debt off quite a
few years earlier.
The town had set aside $200,000 of its
rainy day fund to pay off a chunk of the money it owed to Maryland, but
Emmitsburg actually owes the state only $123,325 once the town’s previous
payments were subtracted.
The commissioners decided now to pay the
balance in full. The difference between the $200,000 and $123,325 will remain
in the rainy day fund.
As for the payment the town was going to
make to the state next year of $38,921, the commissioners will decide at a
future date how to spend that windfall for the operating budget.
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