Retirement Benefits

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Employee Retirement Systems of Alabama (ERS)

ERS is a Defined Benefit plan qualified under Section 401(a) of the Internal Revenue Code. A Defined Benefit plan means that each employee will receive a specific payout at retirement using a benefit formula. The factors determining an employee’s retirement benefit include the employee’s salary, length of service, and a retirement benefit factor. Participation in ERS is mandatory for Madison County eligible employees.

Participants are either Tier One or Tier Two depending on the date of hire. Tier One participants are those hired or have service credit prior to January 1, 2013. Tier Two participants are those not hired or who did not have service credit prior to January 1, 2013. 

Deferred Compensation Plans?

Madison County employees are offered two separate 457(b) Deferred Compensation Plans: RSA-1 and Nationwide Retirement Solutions.

A 457(b) Deferred Compensation plan is a retirement plan that allows public employees to put aside pmoney from each paycheck toward retirement. Employees are vested in their own contributions but are subject to meet certain criteria before account distributions can be made.

RSA-1 Deferred Compensation Plan

RSA-1 funds can be invested in either bonds, short-term investments, stocks, or a combination. Participants may change their investment elections ninety days from their last election. There is no annual minimum contribution required to participate in RSA-1.

Nationwide Retirement Solutions Deferred Compensation Plan

My Nationwide has many investment options including international funds; small, mid, and large-cap funds; balanced and bond funds; short-term investments; target date funds; and a fixed account. There is a $260 annual minimum contribution required to participate in Nationwide Retirement Solutions.

Retiree Health and Dental Benefits

Madison County offers health plan coverage to eligible retirees. Coverage is provided at the time of retirement from Madison County. Coverage is also provided for spouses and eligible dependents and ends at the time of the death of the retiree. Spouse coverage will be terminated upon divorce.

Non-Medicare eligible employees will remain on the LGHIP Active Employee Plan until becoming Medicare eligible.

Medicare-Eligible employees will be covered under the UnitedHealthcare Medicare Advantage (PPO) Plan. This plan is a Medicare Replacement plan that provides the benefits of Medicare Part A and B, an integrated Prescription Part D coverage, and extra programs beyond original Medicare.

Employees hired after January 1, 2018, must work twenty continuous years for Madison County before being eligible for health insurance at retirement. Retiree premiums will be established based on current market value regardless of years of service with Madison County.