HomeMy WebLinkAboutSubmittal-Memo-City ManagerSUBMITTED INTO TH'V
CITY OF MIAMI, FLORIDA PUBLIC RECORD FOR
INTER -OFFICE MEMORANDUM
ITCAA cW,
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TO: Honkra]61e City Commission DATE: October 21, 2009
SUBJECT: Elected Officials Pension Options
FROM: Pedro G_ Hern"NJdez. P.E_ REFERENCES: Agenda item SR -1
City.Manager October 22, 2009
ENCLOSURES:
Tn response to .a Commission directive at your meeting of October S''; 2009, Administration was
.requested to provide the Commission with several options as to ,defined contribution pension plans that
could be offered to newly ,elected city -officials in lieu of the current city retirement pian. The City
,currently has in place an ICMA RC - 401 Governmental Money Purchase Plan &"Trust (Trust). Under
the Trust Document, there are different adoption .agreements which define and outline the defined
contribution for :different .cla&sifcations. The City currently has four adoption agreements: -Executives
Retirement Plan, 'City .Attorney Retirement Plan, City Manager Retirement Plan, Assistant ,City Managers
and Assistants to the City Manager Retirement Plan.
The (City of Miami Executive Retirement Plan provides that those eligible to participate in the plan .are
those who .hold titles as :specified in 'Ordinance 10458 as well as :newexecutive titles established to be
added at the City's discretion. The contribution provisions area fixed ernployer contribution -.of 8 percent
,of ,earnings for the plan year and a required .employee ,contribution :of 10 percent Df ear Ings. The
employee cannot discontinue nor vary the rate sof such -contribution after becoming a plan participant.. Each
participant may make a voluntary (unmatched), after-tax contribution. Each participant is fully vested
upon becoming a plan participant.
In addition to ;the above option, there are several different structures currently available to the City:
• Contri`butions by Employer ,only
y Employer contribution set at a specific percentage and Employee contribution set at a variable
rate from 0% to 20% for a Plan Year, but shall not have the (right to discontinue or vary the rate of
such contribution after becoming a Plan.Part cipant_ In other words, once a participant makes i
contribution selection, it cannot bechanged.
Contributions by .Employee only (no available city plan and participants :at this time)
As an example of these options, ,our City .Manager Retirement Plan :provides for the Employer, the City of
:Miami, to contribute on behalf of the participant. This Plan does not require any 'contribution by the
participant. The City Attorney :plan is similar in that the Employer makes the only -contribution, and the
'City Attorney has no requirement to contribute. On both of these options, the Employee can make after
tax contribution and each will be fully vested upon becoming a plan participant The contribution
;percentage -of the Employer is negotiated in the .contract !On the Assistant City Managers and Assistants
to the City Manager Plan there is a slight difference in that the Employer contribution is fixed at 8%o and
the employee has no requirement to 'contribute any percentage of their earnings. We hope the above
proffered ,options will assist you in finalizing a pension plan for new elected officials.
C: Honorable Mayor Manuel A. Diaz
.JuEe'O. Bru, City Attorney
Priscilla :A Thompson, City Clerk
Larry ;Spring, -CFO
LeeAnn Brehm, Director, Risk
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