The Pike County Commission is headed for overages in its payroll budget this year, despite the cost-saving retirement incentive passed at the end of 2008.

Eight employees opted for the early retirement incentive program, which was designed to save the county money by lowering payroll costs in future years.

“It’s an expense in this fiscal year, but it’s going to be a savings in the future fiscal years,” said County Administrator Harry Sanders.

The county paid $300,000 in salary and benefits to those eight employees, which equals their combined annual salaries plus benefits. That’s because the retirement incentive package promised 75 percent of the total annual salary and benefits for anyone choosing to retire early. However, the employees all worked the first quarter of the fiscal year – October, November and December 2008 – and took their retirement package at the beginning of the 2009 calendar year. At that point, the retiring employees were paid the remaining 75 percent of their annual salaries.

Sanders said while the plan offered no savings on salary expense this fiscal year, the commission should be able to reap benefits in upcoming years as those positions remain unfilled and the salaries unpaid.

However, the commission also approved $16,600 in raises for two departments, a move sparked by requests to increase compensation to employees who were handling additional responsibilities in the wake of the retirements.

It is that amount that was unbudgeted for the 2009 fiscal year. Chairman Robin Sullivan said the commission typically tries to honor these requests if possible.

“Normally we will honor another elected official’s request in most cases,” Sullivan said. “I think that was our general thought on these two processes.” Sanders said the funds to cover the approved raises could come from an anticipated $88,500 in revenue which is not earmarked for a specific use – assuming all revenues match budgeted expectations. Sanders said the county has lost about 4 percent of its sales tax income, but revenues are not far behind budgeted amounts. “As far as I know, we will still be within (the overall) budget and hopefully under budget for the second year in a row,” Sullivan said.

“We aren’t doing a lot of extravagant spending this year. We have tightened the belt, and we’ll have to do it some more.”