CIVILIAN PENSION BOARD

The Civilian Pension Board meeting was held on February 29, 2008 at 9:52 a.m. with Councilman Hogan presiding. Members present were Mr. McGiffin, Mr. DePrima, Mrs. Mitchell, Mrs. Rigby, Mr. Lucas, and Mrs. Braun. Others present were Mrs. Hawkins, Ms. Edwards, and Mrs. Clendaniel.

AGENDA ADDITIONS/DELETIONS

Mr. Lucas moved for approval of the agenda, seconded by Mrs. Rigby and unanimously carried.

DISCUSSION - ALTERNATIVES TO THE STANDARD ACROSS THE BOARD PENSION COLA

Members were provided a booklet of information reviewed by Mrs. Mitchell, Controller/Treasurer. For discussion purposes, she provided members a proposed policy which would establish a process for Ad Hoc Pension COLA (Attachment #1).

Referring to the review of the CPI (first bullet), Mr. DePrima suggested that an expectation of the review be included and that with regards to determining if the asset to liability percentage decreases in the year (last bullet), he suggested that there should be more explanation to make the determination. He relayed concern with the establishment of the proposed policy, explaining his opinion that it would lead to a mandatory COLA. Noting that the Police Pension provides for an automatic COLA, Mr. DePrima explained that it was developed as a result of a negotiated matter with the union. He suggested that if the City is to consider a mandatory COLA, it should be accomplished by the retirees approaching the union members and requesting that it be considered as a negotiated matter.

Responding, Mrs. Rigby indicated appreciation for the evaluation factors since she felt they would provide protection to the plan. She relayed concern with the suggestion of involving the unions with current retirees, explaining her feeling that it would be unfair for current retirees to be tied to employees. She noted that normally, the benefits negotiated by the unions do not affect retirees.

Mr. Hogan noted that the proposed policy is suggesting a required contribution every year. It was his opinion that the policy should suggest a review to determine if the evaluation factors indicate the ability to contribute $191,670 each year and to determine if it would be feasible for the City to include the contribution amount in the City’s budget.

Responding to Mr. McGiffin, Mrs. Mitchell explained that the proposed policy suggests that the City commit to a contribution in the amount of $191,670 each year, for three (3) years; however, this would not necessarily guarantee that Council would provide retirees with a COLA.

To address the concern relayed by Mr. Hogan, Mr. DePrima suggested the addition of another paragraph that would direct the City Manager to include a contribution in the amount of $191,670 in the City’s Budget each year with the understanding that this contribution is subject to the review and approval of City Council.

In response to the union negotiations, Mrs. Hawkins, Human Resources Director, advised members that not all union members are members of the pension plan. She noted that when the police negotiated their COLA, there was only one (1) pension plan of which the union representatives were members. She explained that another issue is that if the unions bring this matter to the table, they represent their members and that management employees are not represented by any union.

Responding to Mr. Hogan, Mrs. Hawkins estimated that 2/3 of the employees are members of the defined pension plan and that the remaining 1/3 are members of the deferred pension plan.

Mr. Hogan suggested that Mrs. Mitchell formalize the proposed policy and make revisions based on the discussion of members to be further reviewed by members at a later date.

DISCUSSION ON PROCEDURES AND TIMING OF COLA REQUESTS

During a Special Pension Board Meeting on January 16, 2008, members continued a discussion regarding alternatives to the standard across the board pension cost of living adjustment (COLA). As a result, action was deferred on this matter and staff was requested to provide members with those sections of the Charter and Code relative to the City’s Pension Plans, as well as any legal opinions and other pertinent information, for their review and consideration.

Referring to the legal opinion submitted by City Solicitor Rodriguez, dated January 9, 2008, Mr. DePrima noted that the conclusion was based on the concerns that the pension fund included monies contributed by members and the City. He reminded members that the proposal to provide differential COLA’s to retirees included the use of City funds only. Taking this into consideration as well as the fact that so many other jurisdictions provide differential COLA’s to retirees, Mr. DePrima felt assured that there would be no legal concerns should the City choose to provide differential COLA’s to their retirees.

Mr. Hogan suggested that the next meeting be scheduled for March 26, 2008 at 1:30 p.m. with the only agenda item to be the discussion of this topic.

COLA REQUEST FOR 2008

During a Special Pension Board Meeting on January 16, 2008, members considered a COLA request for 2008. The majority of members felt that the age formula provided the best alternative and was most equitable for all retirees. It was suggested that the stipend be distributed either once a year (November) or twice per year (July and November) and that the stipend be provided to those retirees that retired prior to January 1, 2008.

Mr. Lucas moved to recommend that City Council fund a $100,000 one-time stipend to retirees to be provided based on the age of the retiree (Attachment #2), to be distributed July 15^th and November 15^th. The motion was seconded by Mrs. Rigby and unanimously carried.

Mrs. Hawkins suggested that there be clarification regarding the retiree’s age, as to whether it is referring to the retiree’s age as of a certain date or when the stipend is dispersed. In addition, she questioned if the stipend would be provided to recent retirees. Mr. Lucas noted that members previously suggested that the stipend be provided to those retirees that retired prior to January 1, 2008.

Mr. Hogan requested that when this matter is presented to Council, Mrs. Mitchell include clarification of the date to be used regarding the retiree’s age in determining the stipend as well as an effective date that the stipend would be provided to retirees who retired by a certain date.

Mr. Lucas moved for adjournment, seconded by Mrs. Rigby and unanimously carried.

Meeting Adjourned at 10:42 P.M.

Respectfully submitted,

Kenneth L. Hogan

Chairman

KLH/ac/jg

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