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City OKs study on responsibilities for retiree health benefits
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By CHUCK CLEMENT, Staff Reporter
| 08/18/2009 |
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An Omaha-based actuarial company will review the city of Madison's financial responsibilities regarding the health insurance benefits it offers to retired city employees.
The city will hire Silverstone Group, an actuarial and consulting business, to conduct the study that is required by the Governmental Accounting Standards Board. The rules, titled GASB 45, were approved in 2004 because concerns had developed over the amount of retiree benefits some governmental bodies might need to pay for in the future.
GASB 45 requires local governments to measure and report on the liabilities -- other than pensions -- associated with other post employment benefits (OPEB) such as medical, dental, pharmacy and long-term disability coverage.
According to Jeff Heinemeyer, city finance officer, five retirees are currently enrolled in the city health plan. The city allows retired persons with 15 years of service and between the ages of 55 and 65 to remain on the city health insurance plan. After age 65, a retiree can join the Medicare system.
Along with information about the retirees and their health benefits, the Silverstone Group will ask the city to provide information about current monthly premiums, current contribution rates from both the city and retirees, historical net claims and current coverage data.
The Omaha company will perform the actuarial valuation and reporting tasks for a basic service fee of $4,800. The company also provided a list of optional services that the city could request, such as analysis of prefunding options and liability management advice. The company will base the payments for the optional services on hourly billing rates and travel expenses, not to exceed $1,300.
Heinemeyer said the cost of the study was payable with money already available in the 2009 municipal budget.
The commissioners approved holding a surplus property auction for the city in the early afternoon of Sept. 17 at the municipal shop building. The police, water, streets and parks departments have assembled lists of equipment that they want to sell. The equipment list includes cameras, copiers, air compressors, mowers and a 1997 Ford police car.
The commissioners authorized Mayor Gene Hexom to sign a development lot agreement with Dale and Lynette Nugent concerning two adjacent pieces of land in the 800 block of N. West Avenue.
The Nugents want to construct a detached garage on the land next to 811 West Ave. N., but city law requires replatting of property when land is acquired and residents want to build an accessory structure on the acquired lot. The development lot agreement accomplishes the same function as replatting, but without the accompanying expense. In the agreement, the Nugents and future owners of the land promise to sell the land as one parcel of real estate, not separately.
The commissioners also approved a variance request from Jerae and Kendra Wire to construct a 16x28-foot garage addition to their home at 939 E. Maplewood Dr. The addition of a third garage stall will allow the Wires to store a boat indoors on their property. Neighborhood covenants do not allow the construction of outbuildings on their lot.
The Wires requested a 5'6'' sideyard variance instead of the required 7'6'' sideyard setback, The addition will also create a garage that is 42 feet wide instead of the allowable maximum of 40 feet.
The city planning commission had recommended approving the variance on Aug. 11 with a 4-2 vote.
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©Madison Daily Leader 2009
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