HomeMy WebLinkAboutResolutions - 1993.08.26 - 22040REPORT (Misc. #93165) AUGUST 26, 1993
BY: FINANCE COMMITTEE - John P. McCulloch, Chairperson
RE: DEPARTMENT OF PERSONNEL/RETIREMENT INCENTIVE PROGRAM
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
The Finance Committee, having reviewed the above referenced
resolution, reports with the recommendation that the resolution be
adopted with the following amendments: //
•The third BE IT FURTHER RESOLVED paragraph to
read, "that all employees after January 1,
1994 contribute three percent (3.0%) pre-tax
of their salary as defined in Section Three of
the Rules and Regulations of the Retirement
System, excluding overtime."
•Delete the fourth and sixth BE IT FURTHER
RESOLVED paragraphs.
•In the fifth BE IT FURTHER RESOLVED
paragraph, change the date to January 1, 1994.
Chairperson, on behalf of the Finance Committee, I move the
acceptance of the foregoing report.
MISCELLANEOUS RESOLUTION #93165
BY: Personnel Committee - Marilynn E. Gosling
IN RE: DEPARTMENT OF PERSONNEL/RETIREMENT INCENTIVE PROGRAM
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS, the Department of Management and Budget has projected a
significant budget shortfall for 1994; and
WHEREAS, one means of addressing the projected budget shortfall while,
simultaneously, creating many opportunities for reorganization and position
deletions is to provide a strong incentive for long-time County employees to
retire; and
WHEREAS, an actuarial assessment has been performed by Gabriel, Roeder,
Smith & Company of the potential for savings by offering an "Incentive Window"
to currently eligible employees and an "Early Out Window" to certain employees
not yet eligible for retirement; and
WHEREAS, the findings of the actuary are summarized in the attached Fiscal
Note which reflects an estimated annual savings of $3.2 million; and
WHEREAS, the stated savings is predicated on cost reductions of twenty-five
percent (25%) of those positions being vacated through retirement; and
WHEREAS, the proposed Retirement Incentive Program has been reviewed and
recommended by the County Executive.
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners
authorizes implementation of the RETIREMENT INCENTIVE PROGRAM, to be offered to
non-represented Retirement System members, who will be eligible to retire by
December 31, 1993 or whose age and service including military service credits and
Michigan Reciprocal Retirement Act service time will total seventy (70) by that
date, with a minimum service of eight years.
BE IT FURTHER RESOLVED that the RETIREMENT INCENTIVE PROGRAM be offered
during a ninety-one (91) day window of opportunity beginning October 1, 1993 and
ending December 30, 1993, with the Retirement Factor of 2.2 to apply only to
retirements that take place during that period and only to Benefit Plan A
employees, with Benefit Plan B employees also being eligible but with a factor
of 1.8.
BE IT FURTHER RESOLVED that employees desiring to participate in the
RETIREMENT INCENTIVE PROGRAM must file a written application with the Retirement
Commission on the appropriate form no later than November 30, 1993 in accordance
with Section 37 of the Rules and Regulations of the Retirement System;
BE IT FURTHER RESOLVED that all employees newly hired or rehired after
October 1, 1993 contribute three percent (3.0%) pre-tax of their salary as
defined in Section Three of the Rules and Regulations of the Retirement System,
excluding overtime, and that all current Benefit Plan A employees begin
contributing one-half (50.0%) of any future general salary increases until their
contribution level reaches three percent (3.0%) of their salary as defined above;
BE IT FURTHER RESOLVED that for employees not eligible for or not electing
the "Incentive Window" or "Early Out Window" in 1993, the retirement factor be
increased from 2.0 to 2.2 effective January 1, 1996 if employee contributions
have reached three percent of salary by that date, and if contributions have not
reached that level then the benefit factor shall be increased from 2.0 toward 2.2
in the same proportion that the contribution level is of three percent (e.g., if
contribution level has reached 1.5% on January 1, 1996 then the factor shall be
increased to 2.1%) and that the employee continue to contribute one-half of
future increases and the factor continue to increase proportionately until such
time as the contribution level reaches three percent of salary and the benefit
factor reaches 2.2;
BE IT FURTHER RESOLVED that all retirements becoming effective on or after
January 1, 1996 shall not include overtime in the computation of Final Average
Compensation;
BE IT FURTHER RESOLVED that employees retiring after December 30, 1993 be
required to contribute eight dollars ($8.00) per month toward their health care
coverage and that future contribution levels shall be directly indexed to the
general salary increase for non-represented employees;
BE IT FURTHER RESOLVED that the Oakland County Retirement System Plan be
revised to reflect these changes;
BE IT FURTHER RESOLVED that the Personnel Department be authorized to offer
these changes as a package to all represented groups excluding the employees
represented by the Oakland County Deputy Sheriff's Association and Oakland County
Command Officer's Association whose contracts already provide a means of early
retirement;
BE IT FURTHER RESOLVED that in order to achieve the projected savings
referenced above the twenty-five percent (25.0%) reduction in the cost of vacated
positions shall be adhered to prior to the filling of any vacancies or approval
of any reorganizations.
Chairperson, on behalf of the Personnel Committee, I move the adoption of
the foregoing resolution.
PERSONNEL COMMITTEE
FISCAL NOTE (Misc. #93165) August 26, 1993
BY: FINANCE COMMITTEE, JOHN P. McCULLOCH, CHAIRPERSON
IN RE: DEPARTMENT OF PERSONNEL/RETIREMENT INCENTIVE PROGRAM
TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS
Chairperson, Ladies and Gentlemen:
Pursuant to Rule XI-G of this Board, the Finance Committee has
reviewed Miscellaneous Resolution #93 and finds:
1. The resolution authorizes a Retirement Incentive Program
with the purpose of creating opportunities for reorgani-
zation and position deletions resulting in a positive
impact on the projected budget shortfall.
2. Based on the 1992 actuarial data of 2,965 General
Retirement System Employees of which 492 would be
eligible for the Retirement Incentive Program, the
following schedule depicts an estimated savings of
$3,167,995 should 50% of those eligible avail themselves
of the program and 25% of the costs of those leaving are
not replaced. Also, based on current costs of
$120,106,871 (Salaries, $96,533,412; Retirement Contribu-
tion, $13,138,197; Retirees' Hospitalization,
$10,435,262) and the fact that the proposal provides for
phase in of a 3% employee retirement contribution, a
comparison is provided that reflects the two extremes of
replacing all or none of those who retire.
REPLACEMENT PCT 100%
REDUCTIONS 0
REPLACEMENTS 246
SALARY
RETIREMENT
CONTRIBUTION
RETIREES'
HOSPITAL'N 10,792,435
SUBTOTAL $120,468,871
CURRENT COSTS 120,106,871
SALARY/CONTRB.
SAVINGS $(362,000)
FRINGE BENEFITS (90,500)
TOTAL $(452,500)
75%
61
185
$93,992,355
12,874,791
10,706,994
$117,574,140
120,106,871
$2,532,731
635,264
$3,167,995
0 %
246
0
$86,369,184
12,070,093
10,450,671
$108,889,948
120,106,871
$11,216,923
2,541,057
$13,757,980
$96,533,412
13,143,024
3. The Program further provides that all retirements
becoming effective on or after January 1, 1996 shall not
Include overtime in the computation of Final Average
Compensation and that employees retiring after December
30, 1993 be required to contribute eight ($8.00) per
month toward their health care coverage with future
contribution levels directly indexed to the general
salary increase accorded non-represented employees.
4. The estimated savings will be reflected in the County
Executive's 1994-1995 Biennial Budget Recommendation.
FINANCE COMMITTEE
A sufficient majority having voted therefor, the resolution,
amended, was adopted.
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STATE OF MICHIGAN)
COUNTY OF OAKLAND)
Misc. 93165 August 26, 1993
Moved by Gosling supported by McCulloch the Finance Committee Report be
A sufficient majority having voted therefor, the report was accepted.
Moved by Gosling supported by McCulloch the resolution be adopted.
Moved by McCulloch supported by Wolf the resolution be amended in the
first NOW THEREFORE BE IT RESOLVED paragraph by changing the service time total
from 70 to 69. Also, delete the 3rd, 4th, 5th and 6th BE IT FURTHER RESOLVED
paragraphs.
A sufficient majority having voted therefor, the amendment carried.
Moved by Kingzett supported by Pernick the resolution be amended by
adding an additional paragraph to read: BE IT FURTHER RESOLVED that elected
officials be exempted from the early retirement program."
The Chairperson stated a "yes" vote supports the amendment and a "no"
vote opposes it. The vote was as follows:
AYES: McPherson, Pernick, Price, Kaczmar, Kingzett. (5)
NAYS: Miltner, Moffitt, Obrecht, Palmer, Powers, Schmid, Taub, Wolf,
Crake, Dingeldey, Douglas, Garfield, Gosling, Huntoon, Jensen, Johnson, Law,
McCulloch. (18)
A sufficient majority not having voted therefor, the amendment failed.
Vote on resolution as amended:
AYES: Miltner, Moffitt, Obrecht, Palmer, Powers, Price, Schmid, Taub,
Wolf, Crake, Dingeldey, Douglas, Garfield, Gosling, Huntoon, Jensen, Johnson,
Kaczmar, Kingzett, Law, McCulloch. (21)
NAYS: Pernick, McPherson. (2)
I, Lynn D. Allen, Clerk of the County of Oakland, do hereby certify that the
foregoing resolution is a true and accurate copy of a resolution adopted by the
Oakland County Board of Commissioners on August 26th., 1993 with the original
record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the
County of Oakland at Pontiac, Michigan this 26th. day of August 1993.
accepted. accepted.
Lyrio D. Allen, County Clerk