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HomeMy WebLinkAbout2018-04-10; City Council; ; Adopt a Resolution approving mandatory employee contributions to a post-retirement healthcare trust (TRUST) for Carlsbad Firefighters' Association, Inc. (CFA) employees pCA Review l,()v ~ CITY COUNCIL • Staff Report Meeting Date: To: From: Staff Contact: Subject: April 10, 2018 Mayor and City Council Kevin Crawford, City Manager Donna Hernandez, Human Resources Manager donna.hernandez@carlsbadca.gov or 760-602-7533 Adopt a Resolution approving mandatory employee contributions to a post-retirement healthcare trust (TRUST) for Carlsbad Firefighters' Association, Inc. (CFA) employees promoted to Fire Safety Management and approving city contributions to the TRUST for CFA employees promoted to Fire Safety Management. Recommended Action Adopt a Resolution approving mandatory employee contributions to a post-retirement healthcare trust (TRUST) for Carlsbad Firefighters' Association, Inc. (CFA) employees promoted to Fire Safety Management and approving city contributions to the TRUST for CFA employees promoted to Fire Safety Management. Executive Summary The TRUST requires mandatory contributions of all participants to comply with Internal Revenue Service standards for tax exemption status. The CFA Memorandum of Understanding (MOU) requires mandatory participation in the TRUST for all CFA employees. The current practice is for CFA employees promoted to Fire Safety Management to continue their participation in the TRUST in order to avoid the loss of a benefit due to promotion. However, there is no documentation requiring mandatory participation in the TRUST of CFA employees promoted to Fire Safety Management. The TRUST notified CFA that a Resolution adopting mandatory contributions by employees promoted from CFA to Fire Safety Management is required by April 30, 2018 in order for these employees to continue participation in the TRUST. Discussion On May 28, 2013 the city adopted Resolution No. 2013-122 to establish a TRUST for post- retirement healthcare benefits for CFA employees. The CFA employees agreed to mandatory employee contributions in the amount of one hundred dollars ($100) per month to the TRUST. On June 13, 2017 the city adopted Resolution No. 2017-105 to provide city contributions in the amount of twenty-five dollars ($25) per month per CFA employee to the TRUST. April 10, 2018 Item #1 Page 1 of 4 Staff recommends adoption of a resolution to formalize and make mandatory the current practice of voluntary employee contributions for CFA employees promoted to Fire Safety Management and to provide city contributions in the amount of twenty-five dollars ($25) per month per CFA employee promoted to Fire Safety Management. No retroactive contributions for current members of Fire Safety Management are recommended. Any future changes to mandatory employee contributions and city contributions for CFA employees would result in a similar change to mandatory contributions for CFA employees promoted to Fire Safety Management. Fiscal Analysis The fiscal impact of the city contributions to the TRUST for promoted CFA employees to Fire Safety Management is two-thousand one hundred dollars ($2,100) annually. The Fire department has sufficient funds in their fiscal year 2017-18 budget and no additional appropriation is needed at this time. Next Steps Employee and city contributions would become effective as soon as administratively possible. Environmental Evaluation (CEQA) Pursuant to Public Resources Code section 21065, this action does not constitute a "project" within the meaning of CEQA in that it has no potential to cause either a direct physical change in the environment, or a reasonable foreseeable indirect physical change in the environment; and therefore, does not require environmental review. Public Notification This item was noticed in accordance with the Ralph M. Brown Act and was available for viewing at least 72 hours prior to the meeting date. Exhibits 1. City Council Resolution. April 10, 2018 Item #1 Page 2 of 4 RESOLUTION NO. 2018-048 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING MANDATORY EMPLOYEE CONTRIBUTIONS TO THE POST-RETIREMENT HEALTHCARE TRUST (TRUST) FOR CARLSBAD FIREFIGHTERS' ASSOCIATION, INC. (CFA) EMPLOYEES PROMOTED TO FIRE SAFETY MANAGEMENT AND APPROVING CITY CONTRIBUTIONS TO THE TRUST FOR CFA EMPLOYEES PROMOTED TO FIRE SAFETY MANAGEMENT. EXHIBIT 1 WHEREAS, the City Council of the City of Carlsbad, California has approved the establishment of a post-retirement healthcare trust (TRUST), which provides a tax-favored medical expense reimbursement benefit for medical expenses for retired fire fighters who meet the eligibility rules of the plan; and WHEREAS fire fighter employees of the City of Carlsbad who are in the bargaining unit represented by Local 3730 participate in this TRUST by mandatory employee contributions under the Carlsbad Firefighters' Association, Inc.; and WHEREAS management fire fighter employees promoted out of Local 3730 have requested to also participate in this TRUST through mandatory employee contributions; and WHEREAS the City Council of the City of Carlsbad has the authority to require mandatory deductions from employee payroll for contributions to such Trust; and WHEREAS the City Council of the City of Carlsbad approved city contributions for fire fighter employees of the City of Carlsbad who are in the bargaining unit represented by Local 3730 who participate in this TRUST; and WHEREAS the City Council of the City of Carlsbad has the authority to approve city contributions for fire fighter employees of the City of Carlsbad who are in the bargaining unit represented by Local 3730 and promoted to City of Carlsbad Fire Safety Management. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as follows: 1. That the above recitations are true and correct. 2. That as soon as administratively possible, the City shall impose a $100.00 per employee per month mandatory payroll deduction to be deposited with the TRUST for each eligible employee, as defined by the TRUST, who promotes out of the Local 3730 bargaining unit to City of Carlsbad Fire Safety Management. This amount shall be April 10, 2018 Item #1 Page 3 of 4 EXHIBIT 1 adjusted whenever, and in the same amount that, the contribution amount in the bargaining agreement with Local 3730 is adjusted. 3. That as soon as administratively possible, the City will provide contributions in the amount of twenty-five dollars ($25) per month for each employee promoted from the Carlsbad Firefighters' Association (CFA) into Fire Safety Management. No retroactive contributions for current members of Fire Safety Management will be made. This amount shall be adjusted whenever, and in the same amount that, the contribution amount in the bargaining agreement with Local 3730 is adjusted. 4. That the Fire department has sufficient funds in their fiscal year 2017-18 budget to cover this expense and no additional appropriation is needed. PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of Carlsbad on the 10th day of April, 2018, by the following vote, to wit: AYES: NOES: ABSENT: M. Hall, K. Blackburn, M. Schumacher, C. Schumacher, M. Packard. None. None. M HALL, Mayor BA~SON,fr Clerk {SEAL) April 10, 2018 Item #1 Page 4 of 4