Dallas County Knocks out over $100,000 from its budgetCategories: Hot Sheets,Texas Developments
By implementing a PARS FICA Alternate Retirement System (ARS) for part-time, seasonal and temporary (PST) employees, Dallas County delivers a one-two punch. First, an ARS plan significantly reduces the County’s payroll costs and second, it puts more pay in employees’ pockets. The Texas county expects to trim over $100,000 from the first year’s budget alone. Subsequent years will yield continuing savings.
No pain, all gain
With an ARS plan, Dallas County gains more control of PST payroll costs . Social Security requires a total of 12.4% in retirement contributions, split evenly between employee and employer. As a federally
compliant alternative, PARS ARS requires only 7.5%. With the employer determining the split, public agencies can save up to 79% of PST retirement costs over the cost of Social Security.
Since ARS contributions are pre-tax deductions, Dallas County employees see an immediate increase in their take-home pay. Also, employees own these contributions and are vested 100% from the first day of participation.
Furthermore, ARS accounts are portable. When employment terminates for any reason, the employee decides whether to receive the funds as a lump sum or roll them over to a traditional IRA (or other qualifying retirement plan). Unlike Social Security, employees will receive all the funds in their accounts when they leave the County, rather than a monthly Social Security retirement payment based on a preset formula. In addition, the pension funds become part of their estate in the event of death. Social Security beneficiaries who die lose a significant percentage of their contributions.
Public agencies appreciate the PARS “turn-key” approach to plan implementation, relieving them of most of the administrative and fiduciary duties. ARS contributions are held in a separate trust account, securing fiduciary protection, and processed by PARS administration. Additionally, the defined contribution format will not generate any future unfunded liability. With such compelling incentives for its budget and its employees, Dallas County recognized that it had much to gain by implementing a PARS ARS plan.
A winning strategy with PARS
PARS has collaborated with public agencies and school districts for over twenty years and has established over 700 retirement plans with 380 agencies that have saved millions of dollars. From initial consultation and analysis, to design and implementation, to ongoing administration, PARS customizes innovative solutions that ensure that clients win at the bell.
The PARS Advantage
PARS’ federally qualified retirement plans offer budget savings and better employee benefits at no cost to the agency. Our top-to-bottom approach means minimal management responsibilities for public agencies. PARS does it all – from the initial fiscal analysis, to employee orientations, through plan enrollments, to ongoing plan administration. You can be assured that PARS will responsibly manage your agency’s ARS plan until the last employee receives his final retirement payment.