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HomeMy WebLinkAboutRetirement Committee - Minutes - 11/21/19892IIN0TES OF GENERAL EMPLOYEE RETIN33MENT 0OMMI7TEE WITH CITY PERSONNEL BOARD NOVEMBER 21, 1989 GERC MEMBERS PRESENT: MEMBERS ABSENT: Jerry Brown Mollie Mercer Alan Krcmarik Angelina Powell Dennis Sumner Sue Wilcox, Secretary CITY PERSONNEL BOARD MEMBERS PRESENT: MEMBERS ABSENT: Susan strating, Hewlett Packard Herbert Pedri Michael Dahl, Platte River Power Auth. Safeway Corp. Carole Trask, Poudre Valley Hospital Vickie Ponce, Western Area Power Administration Also present was Ron uthmann of Poudre Fire Authority. Following luncheon provided by poudre Fire Authority, Mike Dahl asked those present to introduce themselves and proceeded then to hear a sutm kuy of the recent events regarding the city's medical insurance problem and activity on the 1990 pay plan. The City's system of bonus/pay for performance was discussed. Mike then turned the meeting over to the General Employees Retirement Committee Chairperson Dennis Sumner. AGENDA REVIEW: Dennis stated that the GERC members welcomed the opportunity to open ca munication between the two Council -appointed commissions. The GERC hoped to obtain feedback and comments on many of the topics GERC is currently studying. He also weld an opportunity to discuss any objectives the Personnel Board might have. Dennis noted that the GERC is currently studying the following issues: 1. Retirement benefit reduction for early retirement. 2. The concept of a "Rule of 80" to credit employees for years of service when determining benefits at early retirement. 3. The competitiveness of the City's GER plan. 4. Distribution of pension benefits to an estate or someone other than a spouseif an employee dies before retirement. 5. Cost -of -living adjustments for retired employees. 6. Vesting at 5 years. 7. If 65 is still a correct reference for normal retirement. 8. security of the retirement plan from the political process. 9. The potential of offering a defined contribution (vs defined benefit) plan. Members of the personnel Board offered comments on their employer's efforts or programs in these areas. Carole Trask of Poudre Valley Hospital offered some continents at the meeting and later called with more detailed information. There is no discounting for early retirement at PVH. A lump-swn early retirement benefit retirement s gien to vested employees when they retire or leave employment ion is paid totally by PVH. The Hewlett Packard representative, Susan Strating, stated that at HP an employee can retire at 55 with 15 years of service. They also have a health plan for post -retirement years, which is available to those who retire at 55 if retiree pays part of the premium. Retirees have a choice of lump -sum or annuity and most choose the lung -sum. If the retiree died, the annuity would be available only to the spouse. They also do pay benefits to an estate or any designee. Employees are fully vested at 5 years and there is no mandatory retirement age. The value of retirement benefits is tied to the performance of HP stack. HP offers a matching contribution retirement fund similar to the city's ICMA option. Mike Dahl said that since Platte River Power Authority was an outgrowth of the City of Fort Collins, its benefits are very similar. However, they do have a cost -of -living increase (tied to the cost-of-livingind)forbuilt retirees.their pension payments. They do not have a lump -sum payment plan Vickie Ponce represents Western Area Power Administration, which is a part of the Federal Government and therefore is governed by their regulations. Employees hired from 1987 to the present are covered by the Federal Employees Retirement System (FERS). Those hired before 1987 are under the Civil Service System, which has three levels of age + years of service categories for retirement. Retirees receive an annuity, but the amount is reduced by 2% per year for each year under those three levels. Employees contribute 8.7% and do not contribute to Social Security. There is a disability component (for both on- and off -the -job injuries). A retiree can receive 80% of their working salary if they are at the maxiimm number of years, but the rate is determined by their three highest years of service. Anyone can be a beneficiary of the pension. A lump sum can be paid, but includes only the e ployee's contribution, with no interest. There is a cost -of -living provision for retirees. Sixty-five is not considered "normal" retirement age. Many people retire earlier than this from Federal employment. The new plan has three components: A thrift savings plan, which is like ICMA, an annuity, and Social Security. In the remaining time a couple of other topics were discussed. Carole Trask mentioned that PVH provides training programs to help employees prepare and plan for their retirement. These programs have been very successful and beneficial to employees. It was noted that funds in the ICMA program are considered an asset of the City. As such there is an element of insecurity with respect to these retirement funds. It was also noted that the CERC will not be addressing the question of the defined contribution plan for the time being. The other issues under study are seen as more pressing and the timing for the defined contribution plan study does not seem good at this time. The meeting was adjourned at 2:30 p.m.