CC 2013-08-27_08.e. Amending Cafeteria Plan for AGPOAMEMORANDUM
TO: CITY COUNCIL
FROM:
BY:
DEBORAH MALICOAT, DIRECTOR OF ADMINISTRATIVE SERVICES~
KAREN SISKO, HUMAN RESOURCES MANAGER ~
SUBJECT: CONSIDERATION OF A RESOLUTION ADOPTING AN AMENDMENT
TO THE FULL FLEX CAFETERIA PLAN SECTION 125 FOR THE
ARROYO GRANDE POLICE OFFICERS' ASSOCIATION FOR 2013
DATE: AUGUST 27, 2013
RECOMMENDATION:
It is recommended the City Council adopt a resolution establishing an amendment to
the Full Flex Cafeteria Section 125 Plan ("Cafeteria Plan") for the Arroyo Grande Police
Officers' Association ("AGPOA") for 2013.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
There will be a decrease in cafeteria plan costs of approximately $5,400 for the period
of September 1, 2013 through December 31, 2013. Minimal staff time is projected to
make the changes.
BACKGROUND:
In 2008, the City implemented the equal contribution plan under the CalPERS Health
Benefit Program to control costs of retiree medical insurance. In doing so, the City was
required to provide a Cafeteria Plan to its employees. Under a Cafeteria Plan,
employees are given flex dollars to spend on their benefits, which include medical,
dental, and vision insurance. An employee may opt out of medical coverage only if
they can provide proof of other coverage. The Cafeteria Plan for the AGPOA was
adopted on August 12, 2008, with an effective date of January 1, 2009.
ANALYSIS OF ISSUES:
Under the CalPERS Health Benefit Program equal contribution plan, the City is required
to provide the same benefit to active employees as retired employees. The amount
designated is the minimum amount required by CalPERS. In 2013, the minimum is
$115.00. This amount is increased annually by a cost of living adjustment. Under the
Cafeteria Plan, the City designates this minimum amount as the medical contribution
Item 8.e. - Page 1
CITY COUNCIL
CONSIDERATION OF A RESOLUTION ADOPTING AN AMEDNMENT TO THE FULL
FLEX CAFETERIA PLAN SECTION 125 FOR THE ARROYO GRANDE POLICE
OFFICERS' ASSOCIATION FOR 2013
AUGUST 27, 2013
PAGE2
towards active employees. Under the equal contribution plan, this same amount is then
designated as the retiree medical contribution. The City's contributions towards the
Cafeteria Plan are negotiated with each bargaining unit. The Cafeteria Plan rates for
the AGPOA for 2013 are the only items changed in the amendment. The adjustment is
necessary because the Memorandum of Understanding with the AGPOA has just been
approved and has a change in the City's contribution amount.
ALTERNATIVES:
The following alternatives are provided for the Council's consideration:
Approve staff's recommendation by adopting the resolution;
Modify as appropriate and approve staff's recommendation; or
Provide direction to staff.
ADVANTAGES:
The Cafeteria Plan was established in conjunction with the CalPERS Health Benefit
Program equal contribution plan for employee groups to assist in managing future
retiree medical costs. Approval of staff's recommendation will maintain the City's
medical benefits consistent with contractual obligation set forth in the terms of the
existing labor agreement. The change will result in a reduced cost and be consistent
with the City's other labor groups.
DISADVANTAGES:
There are no disadvantages to the Cafeteria Plan.
ENVIRONMENTAL REVIEW:
No environmental review is required for this item.
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted in front of City Hall on Thursday, August 22, 2013. The
Agenda and report were posted on the City's website on Friday, August 23, 2013. No
public comments were received.
Attachment:
1. Amendment to the Full Flex Cafeteria Plan Section 125 Plan Document.
Item 8.e. - Page 2
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ARROYO GRANDE ADOPTING AN AMENDMENT TO THE FULL
FLEX CAFETERIA PLAN SECTION 125 TO UPDATE THE
CAFETERIA PLAN RATES FOR THE ARROYO GRANDE
POLICE OFFICERS' ASSOCIATION FOR 2013
WHEREAS, the City Council of the City of Arroyo Grande ("City") deems it in the best
interest of the City and the employees in the Arroyo Grande Police Officers' Association
(AGPOA) to amend the Full Flex Cafeteria Plan Section 125 to update the cafeteria plan
rates for 2013; and
WHEREAS, the City has met and conferred with the Arroyo Grande Police Officers'
Association and incorporated the Cafeteria Plan provisions into their respective
Memorandums of Understanding; and
WHEREAS, a copy of the City of Arroyo Grande Full Flex Cafeteria Plan Section 125 is
on file in the Administrative Services Department.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Arroyo
Grande that:
1. An amendment is made to the Full Flex Cafeteria Plan Section 125 to update the
cafeteria plan rates for the AGPOA marked Exhibit "A", and incorporated herein by
this reference. No other rates were changed.
2. The terms of this Resolution as contained in Exhibit "A" shall become effective
August 30, 2013.
On motion of Council Member , seconded by Council Member
, and on the following roll call vote, to wit:
AYES:
NOES:
ABSENT:
the foregoing Resolution was passed and adopted this day of I 2013.
Item 8.e. - Page 3
RESOLUTION NO.
PAGE2
TONY FERRARA, MAYOR
ATTEST:
KELLY WETMORE, CITY CLERK
APPROVED AS TO CONTENT:
STEVEN ADAMS, CITY MANAGER
APPROVED AS TO FORM:
TIMOTHY J. CARMEL, CITY ATTORNEY
Item 8.e. - Page 4
Exhibit "A"
AMENDMENT
This document amends and replaces Appendix B of the City of Arroyo Grande Full Flex
Cafeteria Plan Section 125 Document. This amendment shall become effective August
30, 2013. Appendix B shall now read:
APPENDIX B
FLEX-DOLLAR ALLOWANCE
ARROYO GRANDE MANAGEMENT EMPLOYEES
With Medical Coverage Total Monthly
Employee Benefit
Employee Only $626.33
Employee Plus One $1, 156.61
Employee Plus Two or more $1,483.43
If employee waives medical coverage (cash $525.98
back option_}__ _______
ARROYO GRANDE POLICE OFFICERS' ASSOCIATION
EMPLOYEES
With Medical Coverage Total Monthly
Em~lo}'!e Benefit
Employee Only $626.33
Employee Plus One $1, 156.61
Employee Plus Two or more $1,483.43
If employee waives medical coverage (cash $525.98
back option)
ARROYO GRANDE SERVICE EMPLOYEES INTERNATIONAL
UNION, LOCAL 620 EMPLOYEES
With Medical Coverage Total Monthly
Emplo~ee Benefit
Employee Only --$626.33
~Employee Plus One $1, 156.61
·-
Employee Plus Two or more $1,483.43
If employee waives medical coverage (cash $525.98
back option)
Item 8.e. - Page 5
Amendment to Full Flex Cafeteria Plan Section 125
Page 2
INTERNATION ASSOCIATION OF FIRE FIGHTERS,
LOCAL 4403 EMPLOYEES
With Medical Coverage Total Monthly
Employee Benefit
Employee Only $635.02
Employee Plus One $1,174.02
Employee Plus Two or more $1,506.04
If employee waives medical coverage (cash $534.67
back option)
FCFA MANAGEMENT GROUP
With Medical Coverage Total Monthly
Employee Benefit
Employee Onl~ $626.33
Emplo~ee Plus One $1, 156.61
Employee Plus Two or more $1,483.43
If employee waives medical coverage (cash $525.98
back option)
CITY OF ARROYO GRANDE
Steven Adams, City Manager
Item 8.e. - Page 6