HomeMy WebLinkAboutRes 08-2 Rvsd Guidelines for Retiree Svc Stipend Pgrm 4 Employees & MembersREQUEST:
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CITY OF PALM DESERT
STAFF REPORT
Consideration of Resolution No. 08-2 rescinding Resolution No. 99-65
and establishing revised guidelines for the Retiree Service Stipend
Program.
DATE: January 24, 2008
MEETING DATE I - - Cig
CONTENTS: Resolution # 08-2 COPITJNUED TO c)
Staff Report [ i PASSED TO 2ND READING
SUBMITTED BY: Lori Carney, Human Resources+4... :.;
Recommendation:
Wave further reading and adopt Resolution No. 08-2 rescinding Resolution 99-65, and
establishing revised guidelines for the Retiree Service Stipend Program.
Discussion:
This resolution is necessary in order to implement the City's last, best and final offer as
presented to the Palm Desert Employees Organization Board on November 30, 2007.
Submitted by:
LORI CAF1NEY
HUMAN RESOURCES MANAGER
r,
n
-/SHEILA R. GILLIGAN
ACM COMMUNITY SERVIC
CARLOS L. O', GA
CITY MANAG
PAUL GIBSON
FINANCE DIRECTOR
G:\HR\HR Group Documents\Staff Reports\Retiree Health Stipend - staff report.docx
RESOLUTION NO. 08-2
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF PALM DESERT, CALIFORNIA, RESCINDING
RESOLUTION NO. 99-65 AND ADOPTING REVISED
GUIDELINES FOR THE RETIREE SERVICE STIPEND
PROGRAM FOR EMPLOYEES AND MEMBERS OF THE
CITY COUNCIL.
WHEREAS, The City's Labor Negotiator has met and conferred with the Palm
Desert Employees Organization on the terms of a Memorandum of Understanding;
WHEREAS, the parties reached impasse in the matter of revising the retiree
health stipend program established in Resolution 99-65 and the City Council authorized
the City Manager to implement the City's last offer; and
WHEREAS, the City notified the Palm Desert Employees Organization on
November 30, 2007, of its intent to implement its last, best and final offer; and
WHEREAS, this offer changes the terms of the program adopted by Resolution
99-65 for employees and Members of the City Council who begin their service after
January 1, 2008,
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Palm
Desert, California, as follows:
SECTION I: Statement of Purpose
The purpose of the City offering a retiree service stipend is to reimburse eligible
retired Palm Desert City employees a portion of their benefit premiums. This stipend is
not meant to fully cover the cost of benefits. This program rewards long term
employees, via the reimbursement stipend, who have given diligent employment service
to the City of Palm Desert.
In response to concerns over the rising costs of post retirement health benefits
and the implementation of accounting standard GASB 45 the City has set up a two-tier
program with different benefit levels based upon employment start date.
RESOLUTION NO. 08- 2
SECTION II: Eli ibili
All full-time or part-time employees of the City of Palm Desert are eligible to
participate in the "Retiree Service Stipend Program" based upon the criteria outlined
below:
Employees and Members of the City Council who began their service rior to
December 31, 2007:
1. The employee must have at least ten (10) continuous years of service with the
City of Palm Desert;
2. The employee must retire from the City of Palm Desert and from the California
Public Employees Retirement System, simultaneously;
3. The employee must be at least 50 years of age at the time of retirement;
4. The employee and/or retiree must conform to the rules, regulations and
requirements of the CaIPERS Health Benefits Service Division to receive the
retiree service stipend;
5. Retirees of the City of Palm Desert may be eligible for CaIPERS Health Benefits
but may not be eligible for the Retiree Service Stipend Program;
6. The retiree service stipend shall cover all retirees previously qualified under
Resolution No. 92-96 (rescinded by Resolution 99-65); and
7. Retirees must be covered by CaIPERS Health Benefit Services at the time of
retirement and must elect to participate in the retiree service stipend within thirty
(30) days of their retirement date.
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RESOLUTION NO. 08- 2
Employees and Members of the City Council who began their service after
January 1, 2008:
1. The employee or Councilmember must have at least fifteen (15) continuous
years of service with the City of Palm Desert;
2. The employee must retire from the City of Palm Desert and from the California
Public Employees Retirement System, simultaneously;
3. The employee must be at least 50 years of age at the time of retirement;
4. The employee and/or retiree must conform to the rules, regulations and
requirements of the CaIPERS Health Benefits Service Division to receive the
retiree service stipend;
5. Retirees of the City of Pa(m Desert may be e(igible for CaIPERS Heaith Benefits
but may not be eligible for the Retiree Service Stipend Program;
6. Retirees must be covered by CaIPERS Health Benefit Services at the time of
retirement and must elect to participate in the retiree service stipend within thirty
(30) days of their retirement date.
SECTION III: General Provisions
The following provisions apply to all employees and Members of City Council,
regardless of the date on which they began City service:
1. The City's Retiree Service Stipend Program will reimburse the employee for the
premium contribution outlined in Section IV of this Resolution. CaIPERS will
reduce the retirement contribution of the retired employee by the amount of the
premium minus the amount set by CaIPERS in accordance with Government
Code Section 22825 as the minimum employer contribution. The City will send
the retiree a service stipend based upon the provisions of Section IV of this
Resolution one per month. The service stipend will only be paid by the City to the
City's retirees; however, CaIPERS Health Benefits may be available to the �
retiree's survivors without a service stipend reimbursement.
Page3of7
RESOLUTION NO. 08- 2
2. All retirees are required by CaIPERS and the City to enroll in Medicare when they
become eligible.
3. If, for any reason, the City elects to change from CaIPERS Health Benefits to
another form of health coverage in the future, retirees will also be placed under
the new health plan. This will insure that there is no disparity in coverage
between active and retired employees; and
4. Should a State of national health care program be established, the City and the
Palm Desert Employee's Organization will, at that time, meet and confer as to the
impacts on the retiree service stipend and make recommendations for
amendments or adjustments as deemed necessary. The City reserves the right
to change the benefits under the program and the payments of the benefits if this
was to occur.
SECTION IV: Citv Service Stipend Contributions
The City has a two-tier system of calculating Service Stipend contributions based upon
the date which an employee or Member of City Council begins their service with the
City.
Employees and Members of the City Council who began their service prior to
December 31, 2007:
1. If the eligibility criteria outlined in Section II are met, an employee is eligible to
receive a stipend as reimbursement for benefit premiums based on the following
table:
Years Served: Percentage of Premium
10 50%
11 55%
12 60%
13 65%
14 70%
15 75%
a. All service must be continuous. Retired employees qualifying for the
service stipend program are able to receive a maximum of Seventy-five
Page 4 of 7
RESOLUTION NO. 08- 2
(75%) percent of the benefit premium reimbursed by the City, regardless
of the number of years of continuous service over fifteen (15) years.
2. The City may elect to add benefits for its retirees. If the City were to add benefits,
over and above the currently contracted health benefits, the reimbursement
percentage may not follow the aforementioned schedule. (10-15 plus years of
service has a reimbursement between 50% and 75°/a of the premium.) A
separate reimbursement schedule may be developed; and
3. The retiree service stipend may be modified in an amount proportionate to any
change in the amount of benefit contributions tot its active employees. Current
retirees are subject to any and all modifications of the retiree service stipend and
related benefits.
Employees and Members of the City Council who began their service after
January 1, 2008:
Employees who retire from City service and who meet the eligibility criteria outlined in
Section II are eligible for a reimbursement of retiree health premiums of up to fifty
percent (50%) of the cost of the lowest cost plan available through the City's health
benefits contract. Percentages available at specific age/years of service combinations
are outlined in the following table:
Years of Service at Retirement
Age: 15 16 17 18 19 20 21 22 23 24 25+
50 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
51 10% 15% 20% 25% 30% 35% 40% 45% 50% 50%
52 20% 25% 30% 35% 40% 45% 50% 50%
53 30% 35% 40% 45% 50% 50%
54 40% 45% 50% 50%
55+ 50% 50%
The following terms and conditions also apply to calculation of the service stipend:
Page 5 of 7
RESOLUTION NO. 08- 2
a) The employee must retire from City service and be receiving a CaIPERS
pension.
b} Reimbursements will be based on premiums for Retiree only or Retiree +
spouse or domestic partner, not family coverage.
c) Reimbursements will be calculated based on premiums for the lowest cost
plan offered by CaIPERS (currently Kaiser HMO). If a retiree obtains
another plan outside of the CaIPERS system, and provides documentation
of that plan and its costs, they may be reimbursed for a percentage of that
premium provided it is not greater than the �owest cost plan offered by
CaIPERS.
d) Retirees, who voluntarily drop their insurance coverage, and therefore the
Stipend, will not be allowed to re-enroll in the stipend program.
e) The Stipend will be discontinued when the retiree reaches Medicare age
(typically 65 years of age) or is enrolled in Medicare, (whichever comes
first).
SECTION V: Annual Recertification Update
1. All retirees who avail themselves of this benefit may be required to provide the
City with annual recertification information in December of each year. CaIPERS
will provide the City with a list of retirees enrolled in CaIPERS Health Benefits
and the type of coverage, the premium amount and the minimum required
employer contribution. This information will be compared to the City's records.
The City will have the following authority:
2. The City will have the sole authority to determine the relevant information needed
to administer this program. Such information shall include, but not be limited to:
a. Retired employee's current mailing address and phone number;
b. Current dependant coverage status and their relation to the insured;
c. Type of health insurance selected by retire from CaIPERS options; and
d. Medicare application and status of Medicare enrollment.
Page 6 of 7
RESOLUTION NO. 08- 2
3. At the time of retirement, the retired employee must sign a statement that failure
to supply this information or providing false information will result in the
termination of the service stipend.
SECTION VI: Effective Date
The retire service stipend program contained in this resolution is effective January 1,
2008, for all employees and Members of the City Council.
PASSED, APPROVED, AND ADOPTED this 24th day of January, 2008, by the
City Council of the City of Palm Desert, California, by the following vote, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
JEAN BENSON, MAYOR
ATTESTED:
RACHELLE KLASSEN, CITY CLERK
CITY OF PALM DESERT
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