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Ala. gov outlines retirement incentive proposal

HUNTSVILLE, Ala. -- Alabama Gov. Robert Bentley plans to ask legislators to pass a bill offering eligible state employees an incentive if they voluntarily retire.

The governor announced details of the plan at a news conference Monday in Huntsville. He said it would either pay 100 percent of monthly premiums for health insurance for five years or offer $15,000 in cash payments in two $7,500 installments. The first installment would be paid when the employee retires and the second would be paid in January of 2014.

He said the program would help retiring workers while also saving taxpayers between $18 million and $26 million a year.

"This program will save taxpayer dollars in both the short term and the long term. The result will be a less costly, more efficient state government," Bentley said.

Republican Rep. Mac McCutcheon of Capshaw said he would introduce the legislation in the session that begins Feb. 5.

If approved, Bentley said the retirement incentives would be available to merit and non-merit employees of executive, judicial and legislative branches. It would not be available to education employees, but the governor's office said a separate voluntary retirement incentive for teachers could be introduced later.

Mac McArthur, executive director of the Alabama State Employees Association, said his first impression of the governor's proposal is mostly favorable.

"I think it's certainly favorable to layoffs," McArthur said, alluding to the state's budget woes in recent years.

But he said he was concerned about the impact of such a proposal on the state's retirement system. He also said he was worried that it could cause manpower shortages in some state agencies.

Lt. Gov. Kay ivey said the proposal would offer "an attractive option for state employees to consider."

Ivey said she saw the incentive proposal as a way to reduce the size of government without impacting services provided by the state.

Jennifer Ardis, the governor's press secretary, said state employees can retire at any age once they have reached 25 years of service. She added that employees can retired at age 60 if they have at least 10 years of service.

McArthur said a somewhat similar plan was offered in the 1990s by former Gov. Fob James and it led to the retirement of several thousand state workers.