11-13-2013 Council Workshop Minutes

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MINUTES CITY COUNCIL NOVEMBER 13, 2013 insurance carrier proposed a 19% increase for 2014 rates. The Administrator pointed out that the City's experience rating is high, thus the large increase in rates. The proposal is to change carriers, which will result in an increase just under 15 %. The Administrator again noted that staff has looked at the League's survey information to ensure that the proposal is within the average ranges. The Administrator also noted that with the change in carriers, future increases would be based on a pooled experience rating and not the City's individual experience rating. McGraw asked if the opt out benefit is a cash benefit paid directly to employees or if it were put in a Health Savings Account (HSA) account. The Administrator indicated that it was a cash benefit. There was then some discussion on Health Savings Accounts (HSA), Flexible Spending Accounts (FSA), and Retirement Health Savings Accounts (RI°ISA). The Administrator then reviewed Holiday benefits, noting that City employees currently receive 11 paid holidays while 60% of cities surveyed provide more than 11 holidays per year. The Administrator noted, however, that he is not proposing an increase in the number of holidays since in preliminary discussion with individual Council Members it appears there may be support for changing the current sick leave /vacation program to a paid time off program. The Administrator noted that many cities have moved from a sick leave /vacation program to a paid time off (PTO) program, noting the results of the LMC salary /benefits survey. The Administrator pointed out that converting to PTO takes the City out of position of monitoring the appropriate use of sick leave. He also pointed out recent law changes which expand the categories of family member that employees can utilize sick leave to care for. Blesener agreed that it was time to convert to a PTO program, and expressed concern with the current severance pay allowance for unused sick leave. The Administrator indicated that he has always viewed sick leave as a benefit to be used when needed, and not as an entitlement. He again pointed out, however, the human resources issues related to the management of sick leave as well as the expansion of State Law. With regard to severance pay, the Administrator pointed out that severance pay is provided for a portion of unused sick leave and is paid into a RHSA that can be used for future health related expenses. He also noted that this was done when it became obvious that most comparable cities were providing this benefit. The Administrator noted that the City does not provide for retiree health insurance benefits. 3