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HomeMy WebLinkAbout1993-03-10 93-189 ORDERDate 03-10'93y V Item No. 93-189 oath][, Autlptiairg City Masnget W irtaqueat the Madre StaW Item/Subject:��®Iee2 Systan W 10M2oran an ial Study Regarding Military Seryire Cxedit. H2 tive Responsible Department: Commentary: Tse � Oc[br wind anon tte City W xaeive an acplar Study fxoan tFe State Rai + SymLa a at an estilmi tl cx a of $5o0. The study world pcwlde tfe City and affaeCtad mplo}e(s with thea ccerts aseociated with actually adoptity this e)WIded Militaxy Service bsylawk p guars. m evd om wsly em the City W fvndir the study, a separate actirnt by Wurc11 mould be .requfxal W adopt L n.W;tixmal allitary cxedit provision. the yfsmnce CaMILUea reviexsd this 11an at thew rnestirnl on, March 3, 1993 ead tmk w fonoal positimt m the xe3ueed. it fs forwarded W LM full (bunch with W C®mittee+�:�, DefvmamrHmd Manager's Comments: ad On.r., i"ha p�u��4vx�aw G., wu<Y ruWui..A tF tett� a 4uro %n gAa u p w p mo%Au0 w�ztQ47a� 4 can Wf 10 �fo^ps "�-`iA°�^"ll�Aaye'�����o a +k. U nVh�npa 6 Ciy Mvmgn Associated Information: Cr , Backgrronand N®n[azebs®, Copy of Btate Lear. Budget Approval: Emmet Ltmrta, Legal Approval: cysaur;,ar Introduced For passage First Reading pep—of Referral 93-189 Aeeig edh ConnedOr ..nine, March 10, 1993 CITY OF BANGOR (TITLE.)(Drber.............a,uncizinst City lit-m.>m�t. ste.r e_srate... tetiraoant Systm to Pazfom an ACCaar Study Rggard5 x itaey service Qedlt By W cut cameo of pN of Ra . THAT 1tn City Manager S authorized to requmt. the Maine state syatmu to perfom an Actuarial study regarding the euq>vrled Military service aedit provisim; and ffi TT kVl®�R WmElff9� THAT The mat of the Actuarial St dy, estinwtal at ON, shall 1» apportiomd to the vatime Oeparhrents with elQloyms wtn ete eligible to participate. 93-189 ORDER IN CITY COUNCIL March 10. 1993 Title. Vote to Indefinitely Postpone failed to pass by the following Authorizing the City Manager to Request yea and no votes. Councilors the Maine State Retirement System to Perform an voting yes: Bragg and Cohen. actuarial Study Regarding Military Service Credit Councilors voting n0: Blanchette.. ���...... .. Frankel, Soucy and Sullivan. Councilors absent: Sail and Shubert. Vote for Passage, passedby the to following'yes and no votes. J.. Councilors es: Blanchette, _- voting y Councilors Soucy and Sullivan. ..... .. .. .......lmen and Stone. voting n Bragg. Cohen Councilmen and Stone. Councilors absent: ' Sax�nd SM1ubex0. ' CITYR� 3M Tot F� comuttee I is Fmn: IbbeYG W. Farmc, Dix T@ of PduLlSatmtimt Far - Update - M to cnaiit P20Vi8JCn, Ma]]m atate �t System Date: Fabry 26, 1993 AS xegoestad by the Finanoe ComSttee mre time ago, the CitY has rccelved from the Maize State sys an estimate to peiYnxm an actuarial study regarag e%j aUng Ban J 's CnIIQR mllitaxy ¢grit pmvrslon Uadec F3tS. 9a estimated fee is $500. 1fie attached meat, Will pmvdde t,.-w.T... nd � on this issue. she Finance Coamittee previously directed that City staff obtain the estimate F the mere system and hien xetzm to the Cmmitoaa for further naviaw and dis Eq n. Based upon the MSF$ estLmata, ny � is that we authorize MSPS to wtlertato3 the actuarial Study. 1'te-coot of the Study can be paid fr® the Petirmeat System apprv,siat:.... in the tares deparoments With the Ll.�st len of interest - Police, Pubdlc Wad® and Fixe. dams action weld an1Y obligate the City to Spain approxtmately $500. a seccacl deo e= weld have to be made by tae City wdetlter to actually adopt the provision, ace the actuarial Study was prepared and the coats to the City and tM interested eaployees wane idgRffied. T are approximately 32 eapdcyees wit, haaee Sed imexestsd in this expanded haefit. $Mold there by any gmestfnna in the ueanrima, plmsa feel free to cortsct me duectly. n w.zm arxusrru w• jGmmmn IYiIIM MAINE STATE RETIREMENT SYSTEM H. e.emo W111 � O°"e."ru`�°" y�ux��sow o..® amY moi. �z"- jANIQI 1993 January 15, 1993v. Robert W. Farrar Director of Administration _ City of Bangor ' 73 Harlow Street Bangor, WE 04401 Dear Mr. Farrar: In response to your correspondence of December 15, the actuary has provided an estimated fee of $500.00 for a study to determine the coat impact should the City of Bangor elect to adopt the military credits provision as provided by 5 MRSA Section 18360 Subsection E. We must be provided with written authorization should you wish for us to proceed with this study. Please note that this information was forwarded to you under cover of correspondence dated February J, 1992, a copy of which is enclosed. This fee has been estimated based on the assumption that the personnel data which was previously provided is still accurate. If this is not the case, then you should submit revised information for our review. If you have any questions or require additional information, please advise. 51 cere D^II1/IOI�jII1r/n e t ee nefi it s specialist pox l mm.wMW W: amu7-1032 2-0470(2) Sec. 3. 5 MRSA §18360, sub -§2, ¶E, as enacted by PL 1985, C. 801, §55 and 7, is amended to read: _ E. A member who served in the armed forces ax-aeY-�'-me-4-ram Aa ab --47 - iy--7� -3�+'3 durina any f .) v ll gu recognized _ __od ofonflirf. d�,fined 3n Title 37-B. -a se^tjan 501.aub==kl n 9. - avh A-1. eubna[aa[anh (a), isentitled to service credit under this subsection 6e@bna-aembersg3@-Befeee-danaaeY-1+-'1988. , 2-0470(2) 93-189- .. -- APPROVED CHAPTER APR 9 '91 23 STATE OF MAINE ey 80VERNOR PUBLIC Lift IN THE YEAR OF OUR LORD NINETEEN HUNDRED AND NINETY-ONE - S.P. 24 - L.D. 34 An Act to Amend the Retirement Laws Be it enacted by the People of the State of Maine as follows: Sec. 1. 5 MRSA §18311, sub-§$ 9A, as amended by PL 1989, C. 710, §17, is further amended to read: A. If the member qualifies under section 18360, subsection 2, gaeagssph-9-, contributions shell -be are calculated at the percentage rate required of active members during the period of time covered by the service in the armed forces applied to the member's earnable compensation duringthe first year as an employee subsequent to service in the armed forces under the following terms and conditions: (1) If 2 or more percentage rates were in effect during the period of service in the armed forces, the highest percentage rate shat; -be a used; (2) The minimum rate s§all-be is 5%; and (3) Interest at a rate set by the board not to exceed regular interest by 2 or more percentage points s4a}? 9e itt paid on the unpaid balance beginning January 1, 1976, or the date of attaining 15 years of creditable service, if later, to the date payment is made. Sec. L 5 MRSA §18311, sub -§2, ¶B, as enacted by PL 1985, c. 801, §§5 and 7, is repealed. 1-0470(2) -2 - discussions with officials at the Retfrment System, this cost is estimavai to is in the ra R of perhaps $500 to $1,000 depending on the muted of - employees eligible and ctl factors. flrz[F , if adopted, t will be oaatain natching coMxibations megnizs3 of the employer for tense employees who choose to bay back their military tive• Seccni, given that this item is of an xvmtdc nature, an ang mmt could le rade that the City should bargain with the Unions representing City mploysas. In essetce, if this new pmvieion was adopted by the City, it would provi de an additlaaal hmefit that is not now availa]ale. 1'his cement is taiperad, lw.sver, by the fact that the adoption of this provision is an all or xothing prop,sftion. it is my understanding that the City cannot adopt this provishon for Certain grwYs of e,ploysss. Rather, it mist either be adopted for all mployeas or for on ore. van: ' retail that the Courcii and staff have bon cs:midaz:� the issue of possible witldrawl from the Baine State Retirarant System, primarily clue to its high cost. Ube pctent+ adoption of this Envision would cost tlse City additional sonny, altleugh at. this Point we do not lona h such. Given the store discussion, I would ravmand the following course Of action: 1. TT t City staff receive ap riate authorization to request that the Nate state ReGirarant Syatas perf000 the nuosasary actuarial study. as a suggeatien, perhaps the N ons should ho mquestad to Participate in this cost along with tlo City. 2. If authorization is receival, City staff will immediately begin to collect the naalsi mployou itnfomation to forasrd to tha Retizemant System for the study. _ 3. Once the actuarial study is crnpletai and foxwardai to the City, a Council Order agenda item would be prepared for Council comottee and/or full Council mi and action. - I holieve that this roiuse of action will provide the parties involved ami interested with the necessary infon ation with which ie make an appropriate decision. I am aware that there'. hoen a muest sada for this item to appear on the fttWer ], 1991 Finance Csnmittee agenda, and topsfully this infosation will be of assistance. Should there by any other information needed, please ne ma know as stun as possible. rase/ldr cc: Finance Diaxtnr l4mren Resourn s hangar 93-189 MFlS�IMUll'i _ 'N: Eduard A. Barrett, City M� PR; Fnlwyt W. Farrar, Di=tar of P[bdro'stratfon SS: Mllitary Qsiit Provision -Maine State Retixarent System 6A: (kXntBi'3, 1991 share has been rami int¢est again cweex,ting the possible adoption by the City of a new I isfen crorcexiwg credit for military tuns "oder ills Mahe State nar:.ow,m sysren. As reguestedl Please find below a brief swdassy of Lure City,s presart status regarding military credits and option that are available. As you a aware, the City. in 1983 adopted a provision to cxalit Al eligible euyloyees for military service ansdits as provided in 5 M.R. S.A. 4 1094(13). Essantielly, this shoed eligible oupl� to pncclase up to 4 years of active duty tyre as bra of the I red Fns<zs provided they I SS years of creditable Service index the systan with some of that service prior to January 1, 1976. In September, 1985 an additioml military c t provision was srecTsi by the legislature which would allow p rticipstug districts Such as ssngor W further a ud the silftary c t Provision. 1 benefit would apply to sabers wim serval full tore duty as menbers of the Arned Forces t sen August 5, 1964 and May 9, 1975 P ided that they have 15 years of creditable service under the systan with sans of that cre i table service prior to Jawary 1, 1988. Thin Provision is garerally bum: as the Vietnam era provision as it would L sically serve to cover those involvai in that conflict. ne City, to date, hue not adopted this Provision. Again in April, 1991, the State legislature mresai the Rotirarent laws with t to military "credits. T most rsent ansnirent states that "a unbar win serval in the a forces during any falerally recog asodl perind of conflict is entitled to service cralit uxuex this subsection". ibis provision still req" 15 years of creditable service but elS Toes the various eligibility dates prevfcusly required. T Provision has not yet baen adopted. In sy discussions with those Who are in favor of the City ad g7uU the nrst recent exla military service credit provision, they sobs tore Point that the City should rot discriminate against those who have serval in r t conflicts by not adopting tha April, 1991 option. They ce.,tom that as the City aoptad the initial provision covering certain a Icyees, it should also adopt the frost recent provision that would weer all otter eployees. Fre, a basic fairness standpoint, r do not disagea. Fbueumr, frau an eoa nnic standpoint, there are certain mrcans that should be noted. First, items will be costs involved to the City. An actuarial study will lave to be per'fomsi by Tire Reddens t Systein to tlefmnios the coats for the mPloyer and eligible eiployess. Fran