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` nrd i�. #� ni►rE: July 20, 1981
§UOJECT Retirees Coat of Li4VN Midi
R�ikA RIEFER6NCE3
�hrll�� �, Gartia
Acting Director ante
ENCLOSURES:
During the current fiscal year, the City made special cost of living
payments to retirees out of the general fund.
The budgeted cost of these payments is $300,000. We expect actual payments
to be as follows:
Payments to retirees $250,000
Administrative expenses 18,000
$268,000
The basis for making these payments has been a half of one percent on the
first $300 of monthly benefits. For instance, a person that has been re-
tired for ten years with a monthly benefit of $600 has received on a monthly
basis:
5% (.5% x 10) of $300 (limit) - $15.00
Florida law requires that an actuarial impact study be prepared for any
benefits received by retirees. In this case, the State has ruled that because
this is a gratuity and the City reserves the right to discontinue it since
they are not intended to be permanent, such impact study will not be necessary.
The payments to retirees are expected to increase approximately 12% during
next fiscal year to $280,000, and administrative costs to $20,000 for a total
budget of $300,000.
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