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Home My WebLink About12/18/1995 BAKERSFIELD dacquie Sullivan, Chair Patricia J. DeMond Mark Salvaggio Staff: John W. Stinson Special Meeting AGENDA PERSONNEL COMMITTEE Monday, December 18, 1995 3:30 p.m. City Manager's Conference Room 1501 Truxtun Avenue, Suite 201 Bakersfield, CA 1. ROLL CALL 2. APPROVAL OF MINUTES A. DECEMBER 4, 1995 B. DECEMBER 11, 1995 3 PRESENTATIONS 4. PUBLIC STATEMENTS 5. DEFERRED BUSINESS A. RETIREE MEDICAL 6. NEW BUSINESS A. 1996 MEETING SCHEDULE 7.ADJOURNMENT FILE COPY NOTICE OF SPECIAL MEETING OF THE PERSONNEL COMMITTEE OF THE COUNCIL OF THE CITY OF BAKERSFIELD NOTICE IS HEREBY GIVEN that the Personnel Committee of the City Council will hold a Special Meeting for the purpose of a Committee Meeting on Monday, December 18, 1995, at 3:30 p.m., in the City Manager's Conference Room, Second Floor, City Hall, Suite 201, 1501 Truxtun Avenue, Bakersfield, CA, to consider: 1. ROLL CALL 2. APPROVAL OF MINUTES A. DECEMBER 4, 1995 B. DECEMBER 11, 1995 3 PRESENTATIONS 4. PUBLIC STATEMENTS 5. DEFERRED BUSINESS A. RETIREE MEDICAL 6. NEW BUSINESS A. 1996 MEETING SCHEDULE 7. ADJOURNMENT John '.~Stinson, Assistant City Manager JWS:jp BAKERSFIELD Alan Tandy, City Manager Jacquie Sullivan, Chair Staff: John W. Stinson Patdcia J. DeMond Mark Salvaggio AGENDA SUMMARY REPORT PERSONNEL COMMrI'FEE Monday, December 4, 1995 4:15 p.m. City Manager's Conference Room City Hall, Suite 201 1501 Truxtun Avenue Bakersfield, CA 93301 1. ROLL CALL Call to Order 4:20 p.m. Present: Councilmembers Jacquie Sullivan, Chair; Patdcia J. DeMond; and Mark Salvaggio 2. APPROVAL OF SEPTEMBER 26, 1995 MINUTES Approved as submitted. 3. PRESENTATIONS None 4. PUBLIC STATEMENTS None AGENDA SUMMARY REPORT PERSONNEL COMMITTEE Monday, December 4, 1995 Page -2- 5. DEFERRED BUSINESS None 6. NEW BUSINESS A. 1996 HEALTH INSURANCE RENEWAL On November 29, 1995, Council referred to the Personnel Committee the issue of 1996 health insurance renewal. The Committee met with the consultant and staff regarding the health insurance renewals. The consultant reviewed the proposed rates and also presented a report comparing PERS as an altemative provider. The consultant indicated that rates for City plans compared favorably to equivalent PERS plans being offered. Based upon information provided by the consultant and staff, the Committee recommends acceptance and approval of the 1996 health plan renewal rates as described herein. The anticipated rate increases are as follows: Blue Cross: Fee-for-Service Medical + 14.93' Fee-for-Service Dental -6.01%* California Care HMO +8.67% Based on 8% (Medical) and 12% (Prescription Drug) renewal caps * These rates assume a transfer of $134,000 from the Premium Deposit Fund to the Premium Stabilization Reserve to cover the margin for claims fluctuation requested by Blue Cross. AGENDA SUMMARY REPORT PERSONNEL COMMITTEE Monday, December 4, 1995 Page -3- The above rate increases would apply to both active and retiree Blue Cross rates. DDS Prepaid Dental: No increase HBI Prepaid Dental: +7.5% Medical Eye Services: No increase Psychology Systems: No increase The Health Care Consultant, Herb Kaighan has met and reviewed the above information in detail with the Joint Employee/City Insurance Committee. The Insurance Committee voted to recommend to the City Council that the rates as presented be accepted for 1996. B. RETIREE MEDICAL UPDATE The City Manager did a brief presentation on the current status and proposal involving the retiree medical plan. The Committee also wes bdefed on proposals presented by labor groups. The Committee requested the City Attorney to provide an opinion regarding the legality of the various proposals and bdng this information back to the next Committee meeting. Staff was requested to set meetings for Monday, December 11, and Monday, December 18, to further review available options. The labor groups presented a proposal to structure retiree benefits into a tiered approach based on when the employees were hired. C, ORGANIZATIONAL CHANGES AND POSITION RECLASSIFICATIONS The Personnel Committee met and reviewed the proposed reclassifications, salary adjustments, organizational changes and updates to job specifications listed below. The Committee recommends approval of the items presented by staff. Additional organizational changes presented by the City Manager for the Public Works, Finance and Community Services Departments were also reviewed and supported by the Committee, but will require additiOnal staff work prior to bringing them back to the Council for action. AGENDA SUMMARY REPORT PERSONNEL COMMITTEE Monday, December 4, 1995 Page -4- As part of the 1995-96 Budget process, a number of reclassifications were requested. They have been reviewed by the Human Resources Division and the City Manager's Office. Staff is recommending reclassification of these employees based on the actual job duties performed by these individuals and pursuant to the Municipal Code and labor agreements. The appropriate Civil Service Commissions have reviewed and recommend approval of these reclassification requests. The following reclassifications and classification changes are being recommended by department: Police Reclassify: Clerk Typist II (Headquarters) to Secretary I Clerk Typist II (Headquarters-Internal Affairs) to Secretary I Transcribing Typist (Vice-Narcotics) to Secretary I Clerk Typist II (Headquarters) to Accounting Clerk II Fire Reclassify: Clerk Stenographer (Fire Training) to Secretary I Development Services Reclassify: Graphics Technician (Planning) to Planning Technician Building Plan Check Engineer (Building) to Civil Engineer III (Y rate incumbent) Delete: Building Plan Check Engineer classification Salary Adjustment: Assistant Building Director to Plan Check Engineer salary level (approximately 4% increase) There are also several updates to current job specifications for the following classifications: Management Information Systems Director change to Management Information Services Director Business Manager Communications Technician I Communications Technician II AGENDA SUMMARY REPORT PERSONNEL COMMITTEE Monday, December 4, 1995 Page -5- Staff is also recommending the following organizational changes: Police Replacement of a Police Captain position (vacant due to a retirement) with an additional Assistant Police Chief position. This is being recommended to provide needed assistance to the Police Chief and provide for advancement opportunities within the Police Department. This change is being recommended due to several retirements and the vacancy created with the departure of Assistant Chief Lewis. Public Works Due to the promotion of the Assistant Superintendent/Streets to Street Maintenance Superintendent, the Public Works Department is requesting the elimination of the Assistant Superintendent position and utilization of the savings from that action to fund an additional Street Maintainer position and a Utility Worker position. 7. ADJOURNMENT The meeting was adjourned at 6:30 p.m. Staff present: City Manager Alan Tandy; Assistant City Manager John W. Stinson; City Attorney Judy Skousen; Assistant City Attorney Michael AIIford; Assistant Finance Director Gil Rojas; Finance Director Gregory Klimko; Police Chief Steve Brummer; Public Works Director Raul Rojas; Community Services Manager Lee Andersen; Human Resources Supervisor Janet McCrea. Others present: Herbert V. Kaighan, Senior Vice President, Godwins Booke & Dickenson; retiree Margaret Ursin; retiree Richard Watkins; Fire Captain Ed Watts; Firefighter Scott Monroe; Police Detective Jim Cecil; Police Detective Harry Scott; and Police Detective Randy Boggs. cc: Honorable Mayor and City Council JWS:jp B A K E R S F I E L D Alan Tandy, City Manager dacquie Sullivan, Chair Staff: John W. Stinson Patricia J. DeMond Mark Salvaggio AGENDA SUMMARY REPORT PERSONNEL COMMITTEE Monday, December 11, 1995 4:15 p.m. City Manager's Conference Room City' Hall, Suite 201 1501 TrUxtun Avenue Bakersfield, CA 93301 1. ROLL CALL Call to Order 4:25 p.m. Present: Councilmembers Jacquie Sullivan, Chair; PatriciaJ. DeMond; and Mark Salvaggio 2. APPROVAL OF DECEMBER 4, 1995 MINUTES No action taken. 3. PRESENTATIONS None 4. PUBLIC STATEMENTS None AGENDA SUMMARY REPORT PERSONNEL COMMITTEE Monday, December 11, 1995 Page -2- 5. DEFERRED BUSINESS A. RETIREE MEDICAL PLAN The Committee met to continue discussions regarding the issue of the Retiree Medical Plan. The City Attorney distributed a legal opinion regarding the various classes of eligibility for retiree medical benefits and a legal analysis of the various' options being proposed to address the Retiree Medical issue. Also presented was a memorandum from Assistant City Manager John Stinson with staff's recommendation to address this issue. The memo recommends unblending the Fee-for-Service rates, providing an intensive educational and communications effort for Retirees and offering a Medicare Risk option for Retirees eligible for Medicare. In addition, staff is recommending limiting the Retiree Medical subsidies for those employees not yet hired. Specifically, the elimination of the 42% subsidy and requiring twenty years' service for future employees to participate in the Retiree Medical Plan. Limiting the benefits to employees not yet hired is subject to meet and confer with the bargaining units. The Committee did not take any formal action and asked to meet with staff and have some time to review the materials presented. Another meeting was scheduled for Monday, December 18, at 3:30 p.m. to continue discussions prior to making a recommendation to the City Council at the January 10 Council meeting. 6. NEW BUSINESS None 7. ADJOURNMENT The meeting was adjourned at 6:25 p.m. Staff present: City Manager Alan Tandy; Assistant City Manager John W. Stinson; City Attorney Judy Skousen; and Finance Director Gregory Klimko. Others present: Retiree Margaret Ursin; Fire Captain Ed Watts; Police Detective Harry Scott; and Chuck Waide from the Kern County Public Employees Association, SEIU. cc: Honorable Mayor and City Council JWS:jp Retiree Medical Insurance - Cost History* Cit~ 1996:$710,000 Retirees 1996:$370,000 $2~ 80 81 82 83 84 85 86 87 88 89 O0 91 92 93 94 9S N 97 / CltyC..~mtributinn ~] Retm~ * Ra~d on Blended Ram Stmctm. e Example: (1996 monthly rates under current plan, with thirty years service) 90% City 42% City Retiree HMO Rate Basic Rate Subsidy Subsidy Pays Single $156.88 - $141.19 - $0.00 = $15.69 Two Party $318.63 - $141.19 - $0.00 --- $177.44 Family $445.60 - $141.19 - $0.00 -- $304.41 Blended 90% City 42% Ci{y Retiree FFS Rate Basic Rate Subsidy Subsidy Pays Single $247.52 - $141.19 - $103.96 = $2.37 Two Party $489.81 - $141.19 - $205.72 = $142.90 Family $730.98 - $141.19 - $307.01 = $282.78 Unblended 90% City 42% City Retiree FFS Rate Basic Rate Subsidy Subsidy Pays Single $319.98 - $141.19 - $134.39 = $44.40 Two Party $631.78 - $141.19 - $265.35 = $225.24 Family $943.99 - $141.19 - $396.48 -- $406.32 12/05/95 1996 Retiree Fee-for-Service Rates Blended Years % City 42% City FFS Rate Basic Rate Service Subsidy Subsidy Single $247.52 30 $141.19 $103.96 $247.52 25 $117.66 $103.96 $247.52 20 $94.13 $103.96 i $247.52 15 $70.60 $103.96 $247.52 10 $47.06 $103.96 $247.52 5 $23.53 $103.96 Two Party $489.81 30 $141.19 $205.72 $489.81 25 $117.66 $205.72 $489.81 20 $94.13 $205.72 ] $489.81 15 $70.60 $205.72 $489.81 10 $47.06 $205.72 $489.81 5 $23.53 $205.72 Family $730.98 30 $141.19 $307.01 $730.98 25 $117.66 $307.01 $730.98 20 $,94.13 $307.01 l $730.98 15 $70.60 $307.01 $730.98 10 $47.06 $307.01 $730.98 5 $23.53 $307.01 Unblended Years % City 42% City FFS Rate Basic Rate Service Subsidy Subsidy Single $319.98 30 $141.19 $134.39 $319.98 25 $117.66 $134.39 $319.98 20 $94.13 $134.39 $319.98 15 $70.60 $134.39 $319.98 10 $47.06 $134.39 $319.98 5 $23.53 $134.39 Two Party $631.78 30 $141.19 $265.35 $631.78 25 $117.66 $265.35 $631.78 20 $94.13 $265.35 L $631.78 15 $70.60 $265.35 $631.78 10 $47.06 $265.35 $631.78 5 $23.53 $265.35 Family $943.99 30 $141.19 $396.48 $943.99 25 $117.66 $396.48 $943.99 20 $94.13 $396.48 $943.99 15 $70.60 $396.48 $943.99 i 0 $47.06 $396,48 $.943.99 5 $23.53 $396.48 12./12/95 BAKERSFIELD PERSONNEL COMMITTEE - 1996 MEETING SCHEDULE TUESDAYS @ 4:15 PM COMMITTEE MEETING 1996 January 2 February 6 March 5 April 2 May 7 June 4 July 2 August 6 September 3 October 1 November 5 December 3 BAKERSFIELD M E M O R A N D U M December 11, 1995 TO: ALAN TANDY, CITY MANAGER FROM: JOHN W. STINSO~N~, A/~SSlSTANT CITY MANAGER SUBJECT: RETIREE MEDICAL- RECOMMENDATION Staff from the City Manager's Office, City Attorney's Office and the City's health care consultant have spent numerous months analyzing and reviewing possible solutions to the problems associated with our current Retiree Medical plan and its rapid increase in cost to the City. There have been many meetings with the Joint City/Employee Insurance Committee which have not resolved the issue. Practical and legal constraints have limited the available options to structure the plan in a logical manner. In order to address the City's escalating Retiree Health contributions within legal constraints and to provide alternatives and choices to Retirees currently in the Fee-for-Service plan, staff recommends unblending retiree Fee-for-Service rates effective July 1, 1996 with as early notice as possible to retirees. Staff will have to communicate this change to the retirees in an effective manner, explaining the need for the change and alternatives available. Although the increase in the Fee-for-Service rates may create a economic impact on some Retirees, they do have the following choices: a) Stay in Fee-for-Service and pay the higher rates b) Transfer to the Califomia Care HMO c) Transfer to the Medicare Risk plan d) Transfer to Medicare Staff also recommends: _ 1) Facilitate Transfer From Fee-for-Service: For those employees impacted by the increases to Fee-for-Service rates the City will assist them by providing information about options available to them such as transferring to the HMO or Medicare Risk plans. Special educational sessions, staffing or consulting efforts would be made to assist employees with special problems: a) Out of State Fee-for-Service Participants: There are twelve (12) retirees in the Fee-for- Service plan who do not reside in areas where the Califomia Care HMO is currently available. One (1) of these individuals has family coverage, eight (8) have two-party coverage and three (3) have single coverage. The City would look into alternatives for these retirees such as HMO plans in their areas (states) if available and affordable. b) For Those With Special Medical Problems: Paying the increased Fee-for-Service rates may be desirable to these individuals vs. participation in an HMO plan. The rate differences would now be appropriate relative to the less restricted level of care received, There may be other more cost effective alternatives available to these individuals through other sources such as professional organizations, Medicare Risk or separate coverages for dependents etc. The City would explore options available, provide educational assistance regarding health care choices available. 12/11/95 Page 2 - RETIREE MEDICAL RECOMMENDATIONS 2) Implement Medicare Risk: City will implement a Medicare Risk option with the City contributing the cost of the Medicare Risk premium and a fiat dollar amount up to the Meaicare part B monthly premium for 1996 (estimated at approximately $42.50). The combined city contribution will not exceed 90% of the lower of the applicable HMO or Fee-for-Service single party rate. The City reserves the right to modify or eliminate this practice in the future in response to changes in medical plans by providers, the changes to the Medicare program by the Federal Government, or changes to economic or legal conditions, subject to the meet and confer requirements under the law with labor organizations. 3) Umit Retiree Medical Benefits for the Un-Hired: Require that employees not yet hired will participate in the retiree medical plan only as follows: a) Employees must retire from service with the City of Bakersfield and have a minimum twenty (20) years service with the City of Bakersfield. Retirees only receive credit for each full year of City service, Retirees will only receive premium subsidy based on 3% per year of service up to a maximum of 30 years (90%), of the lower of the HMO or Fee for Service Single rate, In no case shall a retiree in this class receive more than 90% of their applicable rate structure (i.e. single without medicare rate, single with medicare rate, etc.) in subsidies from the City, b) All Retirees eligible due to previous contributions to the Federal Government to enroll in Medicare part A and all retirees when eligible by age or other qualification for Medicare part B are required to enroll in those plans as a condition of participation in retiree medical plans. c) Employees not yet hired shall not be eligible to receive the 42% Fee-for-Service plan subsidy. Some aspects of this plan (such as the issue of employees not yet hired) require that we meet and confer with the unions. However, educational and informational efforts may begin as soon as a recommendation is approved by the City Council. MEMORANDUM December 11, 1995 TO: PERSONNEL COMMITTEE Councilmember Jacquie Sullivan, Chair Councilmember Patricia Demond Councilmember Mark Salvaggio FROM: JUDY K. SKOUSEN, CITY ATTORNEY '~ SUBJECT: RETIREE MEDICAL INSURANCE PROGRAM Pursuant to direction from this Committee, the following constitutes a legal overview of the proposed options to the current City Retiree Medical Insurance Program: 1. Brief Factual Backqround: By Resolution No. 227-88 dated November 16, 1988, the Council provided a 42% subsidy of the actual premium for the fee-for-service ("FFS") retiree medical plan to be effective for one year only. At the time the subsidy was granted, it was specifically recognized that the rating experience for retirees and active employees in the FFS program were "unblended" (rated separately). Copies of pertinent documents are attached. Thereafter, the Council continued to authorize the 42% subsidy through incorporation by reference in subsequent MOU's. However, in 1991, the rating experience for actives and retirees were "blended" (rated together) so as to provide a further subsidy to the retirees and lower their premium rates. How this happened is unclear, as there doesn't appear to be any Council action to direct the rates to become blended. Why the 42% subsidy was not terminated at that time is also unclear, as it had been given in lieu of the blended rating experience. This practice has resulted in a disproportionate benefit to retirees under the FFS plan by causing the rates paid by retirees in this plan to be lower than the HMO rates. This is apposite to how most conventional health care programs are structured and encourages participation in the most expensive plan. THIS MEMORANDUM IS EXEMPT FROM DISCLOSURE AND IS PROTECTED BY THE ATTORNEY-CLIENT AND ATTORNEY WORK PRODUCT PRIVILEGES. Memorandum to Personnel Committee December 11, 1995 Page 2 For purposes of this review, there are five categories of employees of concern: 1. Current retirees who have both "vested and matured" in the program (have sufficient years of service and are at least 50 years of age or have suffered a qualifying disability and are participating in the plan); 2. Active employees who have completed sufficient years of service to be eligible for the plan and are at least 50 years of age but have not yet retired; 3. Ex-employees who have completed sufficient years of service to be eligible for retirement under the City's program and are at least 50 years of age; 4. Active employees who have not completed sufficient years of service to be eligible for the plan, are not 50 years of age, and have not yet retired; and 5. Future employe~s (those have not yet been offered employment with the City). When a public entity creates a pension/retirement program, the right to participate accrues when employment is accepted. However, this right does not "mature" until all conditions precedent to participation in the program are met. In the City's~plan, an employee must have fifteen (15) years of service and be at least 50 years of age or suffer a qualifying disability before the right to participate is fully matured. This supports the argument that those employees in categories 4 and 5 do not have "matured" rights to a specific benefit plan as offered by the City. Prior to securing a matured right to participate in the retiree medical program, there is no right to a specific fixed benefit, only a substantial right to a plan of some type. Of course, what constitutes a "substantial retirement benefit" is open to judicial interpretation. Those persons presently retired under the City's program or employees with at least 15 years of City service and who are 50 years of age are entitled to the retirement medical benefit currently received or offered. However, modifications and alterations may be made as long as there is no "detriment" to the participant. Memorandum to Personnel Committee December 11, 1995 Page 3 In any modification of a retirement medical plan, it must be remembered that pension and retirement provisions are to be liberally construed in favor of the applicant. 2. Review of Proposals: Option 1: Unblend the retiree and active employee rating experience. This option is the most legally and factually sustainable unilateral course of action for the City. The City clearly intended to provide the 42% subsidy in lieu of the blended rating experience. Continuing the 42% subsidy with the blended rating experience constitutes a mutual mistake on the part of both the City and those retirees receiving the benefit, thus allowing the City to modify this program. It has been suggested to continue the 42% subsidy for FFS participants and the blended rating experience up to July 1, 1996 so as to allow those retirees who wish to shift to a Medicare risk program to sign up for same during the enrollment period of January to March, 1996. On July 1, 1996, the 42% subsidy will continue, although the rating experience for retirees and actives in the FFS program will be "unblended". This proposal would offer sufficient notice to the FFS participants and adequate opportunity to take action and ensure a smooth transition to an HMO/Medicare risk provider. Option 2: Require an HMO program for all retiree medical participants. The City presently offers a choice between the FFS and HMO retiree medical programs. The ability of the City to unilaterally enact this option is contingent upon the determination that medical care through an HMO is as good as the FFS plan and is thus not a "detriment" to FFS participants. There is authority for the proposition that an HMO medical program is the equivalent and provides parallel services as a FFS medical program so as to support the City's action. Memorandum to Personnel Committee December 11, 1995 Page 4 Option 3: Provide the 42% subsidy at a cap of 1995 dollars with a blended rating experience. This proposal has a diminished probability of being sustained through court action, as the 42% subsidy has been implemented through the years to provide a subsidy toward the actual amount of FFS premium increases. The argument can be made that capping the 42% subsidy at the 1995 rate would constitute a "detriment" to a "specific fixed benefit" because as the FFS premiums increase annually, the percentage of the subsidy (relative to the Premium increases) will actually diminish in light of its fixed-dollar status. Option 4: Distinguish between various categories of employees for purposes of retirement medical programs. The City has a right to unilaterally change the medical retirement program for persons not yet employed. Indeed, the City has the right to exclude persons in this category from participation in any of its retirement medical plans. The City has the right to change, through the meet-and-confer process, the retiree medical plan for current employees who do not yet have a minimum of 15 years City service and are at least 50 years of age or have sustained a qualifying disability. It is a practical impossibility from both an ~ administrative and legal standpoint to blend the .rating experience in the FFS program for those who have vested and matured rights (categories 1, 2 and 3), but to unblend for the remainder of the plan participants. Please note that although it is not legally sustainable to detrimentally modify the benefits of a retirement program for participants who have vested' and matured, the City may unilaterally do so in the case of unblending the FFS rating experience for present retirees, as the 42% subsidy was clearly given in lieu of a "blended" rating experience. Memorandum to Personnel Committee December 11, 1995 Page 5 Option 5: Flat dollar subsidy to all retiree program participants. The real dollar value of the 1995 FFS 42% subsidy is approximately $288,000. It has been proposed to increase this amount to $300,000 annually and distribute it equally between all the retiree medical participants. This would result in an annual City contribution of $1,000 ($83.33 per month) to each of the approximate 300 plan participants. This option may not be sustainable in court, as those in the FFS plan would argue their benefits were being decreased. Option 6: Retain the program exactly as it is for persons in categories I and 3 (i.e., retired persons), but for active employees delete the 42% FFS "subsidy", and 'in exchange increase the City's rate contribution for the years,of-service subsidy to the lowest two- party rate. This option would terminate the 42% subsidy and in lieu thereof, provide a rate contribution of 3% per full year of City service (up to a maximum of 30 years or 90%) of the lowest (HMO or FFS) two- party rate (under 65). At present, the City's contribution to retiree premiums is based on the lower of the HMO or FFS single party rate. The monies saved from a discontinuation of the 42% subsidy would be utilized to fund the increased cost of the higher "years-of-service" subsidy. This option may not save sufficient money for the City to justify the legal risk of changing the plan. CONCLUSION From a legal standpoint, the most legally sustainable option is unblending the rating experience for active employees and retirees in the FFS program. Participants in the City's medical plan appear less likely to object to unblending the rates, as opposed to losing the right to chose between the HMO and FFS plans. Attachment cc(w/attachment): Honorable Mayor Bob Price Councilmember Irma Carson Councilmember Kevin McDermott Councilmember Randy Rowles Councilmember Patricia Smith Alan Tandy, City Manager JKS:MGA:rb R~KS\~OS\R~m~.~-D This Ordinance amends ?ills l? o{ the Mun~ckpal Coda and prezones &pproxima~e],y 104.35 &~el S~ockdale No. 1} ~nnexa~on as an ~-20 (&g~lcul~ur&~ ~en~y-Acre ~n~mum ~3~ $i~e) lone, The Planning Comm£ssion~ on IS, 1988, reco~uoended both t~e prezon~ng and the annexation. ficit leading o~ an O~4Lnance o~ Council ot the Cl~y o~ aaendin~ ?Ltle Seven.eh o~ l~a~e4 a~ ~be nor~beas~ ~rne~ o~ ~sford load and ~l~e ~ne ~r~ an ~one to a C-2 (C~rciaI) lone. I~B, lone ~ange 4787 ~fleraI Plan ~en~nt 2-10, Se~eflt Ill. Pro~sed Zonm Change 47~7 .oul~ replace existing (Lzmt~ed ~ul~tple Family ~elltng) Sonm ~tth C-2 (Co~erctat) l~ne on a total o[ 4.082 Icrml tot Parcels A (2.02 acres) and B (2.062 acres). Pirie Reading of an O~dtnancm of the Council of ~he City of ~kerlfield amending Tl~lm ~ntemn of ~kersftmld ~untct~l C~e ~ ~ha land use sorting of those certain pro~rCte, tn the City of located sou~h of Harris Road, eam~ of Wtble R~d to Freeway 99 fr~ afl (~gh~ ~nu~ac~uFlflg-Au~o ReLa~ed) lone ~o an M-~ (LLgh~ ~nufac~urAflg~fleFaX Purpose) Zone and a C-2 Zone. Th~s Ord~nanc~vould change ~he zoning ~o ~ coflo~s~efl~ .~ Segmen~ ~, ~PA 2-88. ~,~n a mo~t~n by Counc%~m~~~ce ~sideced as afl ~em ~ha~ a~ose a~er ~he agenda was p~epa~ed and ~Fequ~res ac~on a~ ~hi8 meeting. Vhe mo~on was approved ~o~o~q vo~e: ~7os: Counc~lmem~rs ~m~, C~da, ~Mofld, Ra~y, Pe~ecson, Mc~rmo~, SalvaggLo Noes: None Abstain: None &bsent: None Counc~member Ra~:~, Cha~pecaon o~ :he Budge: and ~inance C~m~::ee, cead Repo=: NO. 45-88 ~egA~d~ng Heak:h BeneS1: Plan as Bake~aE~el~ Cal£~ornta, #ovamb~ ~6, ~981 - Page 22 The Budges and ~nance ConunL~ee mt~ on November ~4~ ~gS~ to ~tne~a ~he ~evtev o~ ~he C~i hea~Ch inO danca~ ~ne~ p~ln. ThLl ci~ev ~gan vhen race ~nc~e~ae~ tot ~he Ln~emnL~y (~ee examtna~on o~ ~he hea~h ~ne~t~a ~n pcepara~Lon ~or remarke~ng the p~an. ~e ~nef~ conau~an~ ~trm o~ ~eo, thC. d~d no~ ~e~e~ve ~ny quotes ~rom ~nauran~e carrLerl Ln ~eaponle ~o Reques~ ~or ~roposala d=e ~o'~he ~cen~ ~ our emp~oT~el ~hooitng the Hea~Ch Natn~enan=e Organts~C~on (H~O) p~an and due ~o ~he ~arge number ot ~ec%reel parc~oLpnC~ng Ln ~ha tndemnL~y p~an. Th~e tdenC~cal trend ~al celu~id tn o~er agencies beLng Xe~ vLCho=~ an ~ndemn~Cy p~an. As descrt~d ~o ~he CouncL~ tn ~he vorka~op October ~2~ ~988~ the dec~aLon ,al made Co restructure heaXth bene[~a ao tha~ the ~ndemnL~y p~an could ~ saved. Th~a ~aa particularly tmpor~an~ ~o re~Lreea and ~o employees apecLalL~ed health need.. These changel Lnvo~ved removLng ~he re,trees from ~he ac~Lve employee experLence poo~ and equa~s~ng payro~ deduction ra~es ~or ~he HXO and LndemnL~y plans. o~ Ct~y ~unda ~veen ~he ~o groups, aa descried tn ~he ac~ached renolu~on~ ~a requLred ~o make sure ~ha~ ~he ra~ree8 a~ no~ pena~sad tn ra~es beyond normal ~ncreaaen experienced by Preferred Provider prov~nLon tn added ~o the p~an along v~h o~her m~nor revlsLons ~o make hea~h benetton more coa~ et~ec~tve. ]n add~Lon, a propoaa~ ~l M~ng considered ~o a~ir ~he ~ne~t~ negoC~a~ton process v~Ch ~he ~rga~n~ng ~hat all unica, ~hrough reprelen~a~ea~ ~otn~y rev~ev hen~h ~nefl~l on an annua~ basts ~n an eftor~ ~o bring coheiton ~o an ~ncreastng~y complex gLe~d. A~hough ~he ~orm or. ~he p~an ~t~ ~e agreed ~ ~y ~e un,on repreaen~attve8 outside oE the Lndtv~dua~ un,on nego~a~Lon process, ~he Ct~y'a ~Ln~nc~a~ contribution sc~ be par~ oE salary nego~La~tonn. These proposed changes have ~en revteved ~hta C~ee and ~he C~y CouncL~ during ~orkshop. ]n add~on, ~he ~p~oyee Xnaurance Committee, ~he barga~nLng unL~a and employees 'ac ~arge have had a settee o~ mee~Lnga. The bargaLnLng ~nt~8 have verbally agreed proposed change8 bu~ ~1~ have ~o adop~ amen~en~s ~o Hemorandums oE Undera~andtng, tn addition ac~on ~aken by ~he CouncL~. The Committee expressed 9rea~ concern abou~ c~a~mn procean~ng servLce o~ ~he Foundation ~or Hed~a~ Care oE Kern County vh~ch con~racca B~ue Cross [nnurance Company. -The CommL~ee requested ~ha~ a~aEg ~ork vt~h ~he Foundation ~o Lmprove ~h~s aervLce. The Co~t~ee ~lke ~he den~a~ prepald ptan ~o ~ open ~o a gu~ure change tn carrLer.. Bakete~e~d~'CaL~fotnLe, Hova~bat ~6, ~9~! - Page 33 Therefore. the B~g~t ~nd ~Lrtunce Commtttee requests CouncLL approval o~ thLs repor~ and the a~t~ched reso~tton, ~e Committee a~eo requests CounctL approval o! the ~o~o~tng tev~e~ofl ~n the health and dental benefit8 ~ot employees and retirees o~ the C~ty o~ Bak®ra~Le~d ¢oflt~ngent upon apptova~ o~ these amen~efl:8 to unrra* Hemotand~a o~ Underatandtng~ ~. ~he Ctty~a tn~emnLty p~an ~t~ include a pte~etted Ptovtde~ p~ov~aLon ca ~e. 2. ~hete ~ be a co,on charge ~o~ each employee C~ale, t.e.~ l~ng~e emp~oyee~ employee ~th one dependent, and employee ~th ~am~y, ~tteapee:~ve o~ the hea~th and den:a~ p~an ae~ec:e~. '3"~': ~though ~he :ndemn~ty p~an ~t~ be rs:ed ~ ~:aepara:e~y :et actLve and tettred employees, ~he C~:y ~[~ prevent the tetttee ~tom :e~ertencLng an ~ncreaea :hat results ~rom ~ separate rating. 4. Puture hea~:h and ~enta~ bene~tta ~[L be ~o~n:~y bargained by ~epreaentat~vea each un~: :haC serve aa a atng~e co~Ccee. Such benefits aha~ be dec~ded at any t~me but ~eaoLved by ~to~ 3~ o~ each yea~. 5. The City's ~nanc~a~ contcLb~t~on to~a~d employee hea~th and den:a~ benefits be conatdeced a: meet and con,er sessions concerning ~ne~t packages ~or represented employees and Che C~ty aha[~ conttnue any salary Upon a mo:ton by ~ounct~mem~t Rat:y, Budge: and E~nance Comm~::ee Repot: No. 45-88 ~aa accepted. Rdoptton o~ Resolution No. 227-88 o~ the Counc~ o~ the C~ty o~ Bakete- ~te~d regarding Ctty contt~buttone to ptemt~a ~ot ~ettteea "~ee ~ea~th Upon a motion by Counc~mem~t Ra:~y~ the ~eco~enda- ~ons ~:htn Che BudgeC and ~nance Co~Ctee Report No. 45-88 ~ere tmp[emenCed and Resolution No. 227-88 o: the Counc~ o: the C~y o~ Bake~s[~e~d ~aa adopted by :he ~o~o~ng vote: Ayes: Counc~membe~a Sm[:h~ Ch~da~ DeMond~ Ratty, Pe:e~son, ~cDermott~ Sa~vagg~o Noes: None A~s:atn: None I Abser~t: None RESOLUTION NO. 227-88 A RESOLUTION OF THE COUNCIL OF THE CITY OF BAKERSFIELD REGARDING CITY CONTRIBUTIONS TO PREMIUMS FOR RETIREES "FEE FOR SERVICE" HEALTH PLAN. WHEREAS, the City of Bakersfield wishes to accurately calculate retiree claims costs; and WHEREAS, said calculation will, through separate experience rating, result in increased retiree premiums on the 'Fee for Service" Health Plan; and WHEREAS, the active employee groups expressed their concerns that adjusted higher rates for the "Fee for Service" Health Plan should be shared by the City. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Bakersfield as follows: 1. Forty-two percent (42%) of the actual premium for the "Fee for Service" Retiree Health Plan shall be paid by the City of Bakersfield; and 2. The balance of the above premium shall be calculated pursuant to the.formula attached on Exhibit "A." 3. Retired employees covered under the HMO Insurance (Health Net Plan) shall only receive City contributions under the formula described in Exhibit "A." o0o I HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the Council of the City of Bakersfield at a regular meeting thereof held on November 16, 19~8 by the following vote: ' NOES: C0UNClLMEM~ None ASSENT: COU~IkMEMBERS: ~oRe A~STA~NING' C0UNCI[MEMSE~: None CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED November 16, 1988 MAYOR of the City~ff Bakersfield APPROVED as 'to form: R RES 4 RETIREE. 1 Attachment - Exhibit "A" 11/15/88 l/ EXHIBIT" '" I r EXHIBIT "A" CURRENT FORMULA FOR CITY CONTRIBUTION RETIRED EMPLOYEES GROUP Effective May 1, 1985, retired employees covered under the City's health plan shall receive City contributions based on the following formula: the City shall contribute two percent (2%) of the monthly premium for Health Net (under age 65 rate) times each year of service (to the nearest half year) for single-- party coverage, and one and one-half percent (1-1/2%) of monthly premium for two-party coverage for Health Net (under age 65 rate) times each year of service (to the nearest half year) for retired employees with two-party and family coverage. LTC/lg R RES 5 RETIREE.3 December 8, 1989 TO: HONORABLE MAYOR AND COUNCILMEMBERS~__ ~ FROM: SUE WHITFIELD, PERSONNEL MANAGER ~ SUBJECT: HEALTH CARE BENEFITS Attached is a copy of information that will be discussed at the Council Workshop on Health Care Benefits, Wednesday, December 13, 1989. -..' -. If you have any questions prior to the meeting, please feel free to contact me at 326-3789. SW: lg .-"...cc:" Dale .Hawley, City .Manager ¢i.s~:.'.. BACKGROUND In 1988, the City Council restructured the health benefits package to retain the Blue Cross "indemnity" plan. One of the changes (effective January 1, 1989) separated, "active employees" and "retirees." This permitted the costs of retirees' claims to be distinguished from those of active employees. The City negotiated with the various bargaining units and agreed to pay, in 1989, a 42% cost increase for the retirees. This increase and the premium increases and adjustments for active employees and retirees from 1977 to the present, was paid out of the Medical Reserve Account (not the General Fund). The Medical Reserve Account will be depleted in January of 1991. At that time, it will be necessary to fund any increased costs out of the General Fund or pass the increases on to both active employees and retirees. This means modifying benefits. Report No. 4'~JO I~oll':~e City #anago~ £egardtng Health Care for Retirees. · Actto~ ion ,thio ,~R. eport, wae.'defir~ed,,~roa' the meeting C~t¥ ~anager Dale Mawle¥ read ~oint City/Employee ~ed~cal Xnsuranoe'Committee.Report We. 1-90 ~egarding 'Realth Care for ~et~reee as City/Employee Hedioal~nsu~an~e Committee met, to,~evlew-the,City"me~agew'"s Repo~t on Retiree Health Care, ~hich was presented ~o the Council on danuar¥ 13, 1990. '~~ The Committee considered the City ~anager'e recommendation to p~ck up 42%. of the 1990 premium increase from the ~ed~cal Reserve A¢oount ~or' retire~s.oovered,under Cross'PI&n, on.l¥ up' to ,the per~od end,me December 31~ 1990. '"; , " ~t vas also discussed that the amount taken out of the Medical ~eserve ~ccount would probably be less than the $240,000 originally approved by the Council on December 13, 1989, since 93 retirees transfe~rad~to Health, Her during the ~eoe~t open enrollment..C~rran~l~,.?~)rstirlee'are enrolled in Blue Cross, and 188 retirees are enrolled in Sealth Her. The ma)ority of the Committee members ~ approved the allocat~o~ o~ 42% of the 1990 _~ ~_.health care rates for the retiree group 0~ ~-covered_ __ under the Blue Cross Plan, and that ~' ~this amount be taken ou~ of the ~ ~Reserve,~cooant ~or 1990 The ~o£nt .C~t¥~mp~o¥ee.~edlca~ lnsuran=e Coma£Ctee, requests the Couno~,l's approval o~ th~s Report. ~ Upon...~ ~°~Aoa' by 'Counc~lmeaber' Paterson, C~ty/Emp~oyee X4~le&l .Xnsuranoe CommerCes'Report ~o. 1-90 and C£ty ~an~ger. Report No.~'4-90 ~sgard£ng:Hdalth. Ca~e ~or Retirees Upon a motion by Councllmember ~eterson, the recommendations of delhi City/Employee ~ed~cal Xneurance Committee Report ~o. 1-90 and City ~anager Report Ho. 4-90 were ~mplemented. BAKERSFIELD Alan Tandy, City Manager Jacquie Sullivan, Chair Staff: John W. Stinson Patricia J. DeMond Mark Salvaggio AGENDA SUMMARY REPORT PERSONNEL COMMrl'rEE Monday, December 11, 1995 4:15 p.m. City Manager's Conference Room City Hall, Suite 201 1501 Truxtun Avenue Bakersfield, CA 93301 1. ROLL CALL Call to Order 4:25 p.m. Present: Councilmembers Jacquie Sullivan, Chair; Patdcia J. DeMond; and Mark Salvaggio 2, APPROVAL OF DECEMBER 4, 1995 MINUTES No action taken. 3. PRESENTATIONS None 4. PUBLIC STATEMENTS None AGENDA SUMMARY REPORT PERSONNEL COMMITTEE Monday, December 11, 1995 Page -2- 5. DEFERRED BUSINESS A. RETIREE MEDICAL PLAN The Committee met to continue discussions regarding the issue of the Retiree Medical Plan. The City Attorney distributed a legal opinion regarding the various classes of eligibility for retiree medical benefits and a legal analysis of the various options being proposed to address the Retiree Medical issue. Also presented was a memorandum from Assistant City Manager John Stinson with staff's recommendation to address this issue. The memo recommends unblending the Fee-for-Service rates, providing an intensive educational and communications effort for Retirees and offedng a Medicare Risk option for Retirees eligible for Medicare. In addition, staff is recommending limiting the Retiree Medical subsidies for those employees not yet hired. Specifically, the elimination of the 42% subsidy and requiring twenty years' service for future employees to participate in the Retiree Medical Plan. Limiting the benefits to employees not yet hired is subject to meet and confer with the bargaining units. The Committee did not take any formal action and asked to meet with staff and have some time to review the materials presented. Another meeting was scheduled for Monday,' December 18, at 3:30 p.m. to continue discussions pdor to making a recommendation to the City Council at the January 10 Council meeting. 6. NEW BUSINESS None 7. ADJOURNMENT The meeting was adjourned at 6:25 p.m. Staff present: City Manager Alan Tandy; Assistant City Manager John W. Stinson; City Attorney Judy Skousen; and Finance Director Gregory Klimko. Others present: Retiree Margaret Ursin; Fire Captain Ed Watts; Police Detective Harry Scott; and Chuck Waide from the Kern County Public Employees Association, SEIU. cc: Honorable Mayor and City Council JWS:jp