HomeMy WebLinkAboutItem #24 - Discussion ItemjC75,('p11 R. Cr4is ii c
City 1)arlagnr
Paredes
.7, t.;.t. nt City Manager
,.i
Pension t3Uyhack
Ordinance 8568, adopted by the City of Miami Commission, allowed
the Miami City General Employees Retirement Plan to include certain
laborers, watchmen, and custodial worker:; to join the pension system
for a buyback period of April 1, 1955 through September 30, 1962.
Based on the actuarial assumptions mptions provided by George Ling of Cruse
O'Connor & Linq, which i.ii('liltl;:r) a 35 year funding, an e t.i.nicIL1'Ci
anIIIljl payroll _ of fi2,547,000 with tl current. t: ;c.: of 52 and all
avorario of: 5 years 7 months for }).1,.'}l lc} , t.1LL' amount 1'i'Ct?:..reil from
the City would h3 .$1.97,000 }),,r year for five years for this buyback.
The increased cost of t"hc araful'l:rt-';: accrued liability would
1,41.9,000 with the highest nurb,:r o`. eligible employes for buyback
acco "( i.l1q to 111L actuarial assup...pL:1.Mfl , of 212 ump)Ioyees.
The fi n%an(7ia1: impact: for enr ]r)yoi.':; E :orei inc! the option of buyback
CVO): 5 year }:).?i i0ci would fou,lhly b $35 per month. This figure
is art"a'.v'?d at 0 t'-:(: U'i l'l(1 cti.'t U"12".ldil a sut pt: to:ls of an tt .1'tait. conLl.'.3.
but:1 on el '1l o f: 1 •. { 1 t f 7
�� r'1 ` O.. ;�.1 , 0('t, Cl'i �� 1"1 �.7.1�. ..:1 �i�°.:1 .1 }`l�t2': :)tIC. :) 7. '.'C;
1 i n i'.rel''t'' 1... nth1 ,! ',.
C)1 ;) � �' :) :�1,i)�tl, F:!1_LL:!'! b;iJUl.C.t L+�Ir: t':Ilc' (a;°1)1_ )}""('
1)111'C1x11'.i:. i t' l ;a' '' 3') 1?•,": month ioc a 5 yC'i11. } 'J1 1 00 .
'h2 issue to 1).2 dC?cid'_.'d i S i. r Lh.-. City :ih1)uiCa pity for the 4i' ) ntlrest
COI';1!t)Uitt C :1 aY111U.• 1 1.y f ro:1 thy diLEt of first crclti. Lab1c. sery i c
the isriod covered uutior l)lt1:in1nce 05GS.
13aSi d 031 the iactuarial i1';c;u. pt—ions, the 447. would not exceed $20,000,
as t 1 r r:verat:1e ('(101.ri but i c)1 per employee is roughly ovor $1, 700 pt 1
employee per yo a r .
It th''lt the legisl.`iLiv,, intent. of: i.h,:, ordinance was toinciu(io
individuals t':ht) }a?'('ViOt1S1}' C')ulo not- participate in the City':; pension
T7ierefo ., thy could bi."' viewed as a penalty tiiot those
individuals must. pay due Lo tho fact: that it was not their oF'iion to
join Hi'? pension i.ol1 at: the t ilal':' (7( t_h.' i a.' previous Jiol1:= i'.itip)1C)tit 11ar,nt..
TI1(-.1. `' i ('• t"c: , stall 1.`l.`( l)l11!T. II':1a i ! t:ii1 w(,".1l (i be rO1 t11 City to the
3'C al_u..)1) .'i 1,11. 1 t.l •'rn1 n u'' 1.i1'.. .1 _ '. [ )1 ' h Il `
} t `,, l .; .,-;,-t ;-}� c( l �: 1:r, i r) t•c) c�n>.r� ,: t.il,,
i t. .. 1:+ 3t for th•,'cl i_ t..•tt)1 C: ' f CI'' i)< r i c`, 't)t '',l..,t 11 1 1the `))"(11 )kill."1'
' ' s'' a"re
Joseph II, Grassie
city Manager
included with this memo is information regarding the number of
employees involved and the years remaining for payback, To follow
the ordinance, individuals willhave the ability to either lay in
a lump sutra or prorate it over a period not to exceed 5 year's,
It seem: from the analysis of the number of employees involved? that
all but 8 employees will be able to have over 5 years for payback.
The 8 employees who have less than 0 years for payback would have to
be treated on an individual basis and their- payback wouicl be provided
from their termination pay, which would have been accumulated during
their period of employment,
nased on an analysis of current: active employees who would be eligible
for the pension buyback, all of them except one have over $7 000
accrued towards their separation pay which could be used to pay the
necessary amount for buyback, which averages around $1,700 per employee.
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