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<br /> <br />RESOLUTION 6916 <br /> <br />CITY OF MOUNDS VIEW <br />COUNTY OF RAMSEY <br />STATE OF MINNESOTA <br /> <br />ADOPTING ATTORNEY’S RECOMMENDATION IN REGARD TO TAXABILITY OF <br />EMPLOYEE SEVERANCE BENEFITS <br /> <br />WHEREAS, The City Council approved Resolution No. 5313, which granted Mr. <br />Ramacher severance benefits equal to 100% of his accumulated vacation time in a <br />lump sum payment and 1,393 hours of accumulated and banked sick leave to be used <br />for his health insurance premium payments for as long as the funds were available, and <br /> <br />WHEREAS, Mr. Ramacher contends that the City did not offer him the option to receive <br />any of his accrued sick leave in the form of a lump sum cash payment at the time of his <br />retirement, and <br /> <br />WHEREAS, various options were discussed by the Council, but an investigation by the City <br />Attorney has indicated that there is nothing in the record to suggest that Mr. Ramacher had <br />an option to receive an immediate cash payment, and <br /> <br />WHEREAS, the City Attorney, in a memo date July 20, 2006, has recommended that the <br />City Council approve Mr. Ramacher’s request and direct City staff to refrain from reporting <br />future payments of Mr. Ramacher’s health insurance premiums to the IRS as part of his <br />gross income, and <br /> <br />WHEREAS, in addition, the City Attorney has recommended that prior submissions to the <br />IRS should be amended to accurately reflect Mr. Ramacher’s income paid by the City, and <br /> <br />WHEREAS, the City Attorney has also recommended that Mr. Ramacher be advised of the <br />Council’s decision and be reminded that such Council action does not constitute a legal <br />determination as to the taxability of such payments and that he could ultimately be liable <br />for taxes on such payments if the IRS were to determine otherwise. <br /> <br />NOW, THEREFORE, BE IT RESOLVED by the Mounds View City Council of the City <br />of, Ramsey County, Minnesota as follows: <br /> <br />City staff is hereby directed to: <br /> <br />1. Refrain from reporting future payments of Mr. <br />Ramacher’s health insurance premiums to the IRS as <br />part of his gross income; <br /> <br />2. Amend W -2 forms previously filed with the IRS, as able, <br />to eliminate the health insurance payments made by the <br />City on Mr. Ramacher’s behalf; and <br /> <br />3. Advise Mr. Ramacher of the Council’s decision and <br />remind him that such Council action does not constitute <br />a legal determination as to the taxability of such