The City of Knoxville's Pension Plans: Defined Benefits

Unlike the county, the city of Knoxville is all Defined Benefits, all the time. Except when it's not. Here is its alphabet soup of offerings:

Plan A: This is the old city plan for general employees. Most people switched over to Plan G (see below) in 1997. There are only about a dozen current employees on this plan, so let's just skip the details.

Plan C: This is the uniformed officers' plan for the Police and Fire Departments. It is a Defined Benefits plan, with employees contributing 6 percent of their paychecks. To be eligible for retirement, you have to be 50 years old and have 25 years of service. With a full 30 years of service, retirees can collect up to 75 percent of their monthly salary (averaged from their two top-earning years). There are currently 680 active employees on this plan, and 533 retirees.

Plan G: This is the general city plan for all other employees, which, just to make things fun, has two parts.

— Option 1: All new employees start out on Option 1, which is a half-and-half mix of Defined Benefits and Defined Contributions. Employees contribute 6 percent of their paycheck, with half going into a Defined Contribution fund matched by the city, and half toward a DB pension fund.

— Option 2: After 10 years on Option 1, employees can choose to switch to Option 2, which is a full Defined Benefits plan. It is not quite as generous as the Plan C benefits (it pays at a lower percentage of your salary, unless you work for the city for an improbably long time).

In Plan G, you can reach full retirement following the Rule of 80, which means you are eligible when your age plus your years of service adds up to 80. (E.g., If you've worked for the city for 25 years and you're 55.) All told, there are about 720 active employees on Plan G, and 494 retirees.

All of the plans' benefits have built-in, annual cost-of-living increases. Here are the current estimates for the cost of the city's contributions to the pension fund, by fiscal year. They are based on an estimated 8 percent return on the pension fund's investments:

2012: $11.3 million

2013: $13.8 million

2014: $16.3 million

2015: $18.69 million

2016: $21.1 million

2017: $23.45 million

2018: $26.1 million

2019: $28.69 million

2020: $30.45 million

2021: $30.66 million