CITY OF NORTH LAUDERDALE

HUMAN RESOURCES DEPARTMENT

TO: Honorable Mayor and Commission

FROM: Richard D. Sala, City Manager

BY: Ernest King, Human Resources Director

Jennifer Yarmitzky, Human Resources Manager

DATE: September 13, 2007

SUBJECT: Flexible Spending Account Plan

On September 28, 2001, the Commission approved providing a Flexible Spending Account to North Lauderdale full-time employees. Flexible Spending is a Section 125 plan for Health and Dependent Care. The plan is designed to allow employees, whom select to participate, to have a specified amount of their income deducted from their salary on a pre-tax basis for anticipated/planned health and/or dependent care costs. The flexible spending account card allows instant access to your account funds for approved health care services/products.

Currently, the City has an agreement with Ceridian, through our Colonial representative, to provide the Flexible Spending Account administrative services. This agreement also includes an annual renewal provision. The program costs the City $4.50 per participant (total current year expenditure was approximately $1,500) and Ceridian has not given any indication to increase this rate. Therefore, we are recommending the renewal of this agreement for another year, effective October 1, 2007.

Overview of the current program:

Health Care Flexible Spending Account

· Pays out-of-pocket medical expenses (co-pays, prescriptions, etc)

· Pre-tax dollars are taken out of paycheck as payroll deduction and put into a reimbursable account

· Eligible expenses are reimbursed by a third party administrator as they occur

· Includes a “use it or lose it” clause

· $3,000 maximum contributions established

· Participants receive a flexible spending account card

Dependent Care Flexible Spending Account

· Pays for child care and elder care expenses with pre-tax dollars

· Both parents must be working to be eligible

· Maximum contributions established ($5,000 for married couple filing jointly, $2,500 for married filing separately)

· Includes a “use it or lose it clause”.

This program is well received by the City employees and the percentage of employees enrolled continues to increase annually.

RECOMMENDATION:

The City Administration recommends Commission’s consideration and approval of the attached resolution authorizing the City Manager to continue the existing agreement by and between the City and Ceridian as an adjunct to the agreement previously approved by resolution 06-09-5044 with Colonial Insurance to administer a flexible spending account program for the employees of North Lauderdale.

RESOLUTION _______________________

A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF NORTH LAUDERDALE, FLORIDA, AUTHORIZING AND DIRECTING THE CITY MANAGER TO CONTINUE THE EXISTING AGREEMENT BY AND BETWEEN THE CITY AND CERIDIAN AS AN ADJUNCT TO THE AGREEMENT PREVIOUSLY APPROVED BY RESOLUTION 06-09-5044 WITH COLONIAL INSURANCE TO ADMINISTER A FLEXIBLE SPENDING ACCOUNT PROGRAM FOR THE EMPLOYEES OF NORTH LAUDERDALE; AND PROVIDING AN EFFECTIVE DATE.

BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF NORTH LAUDERDALE, FLORIDA:

Section 1: That the City Commission does hereby authorize and direct the City Manager to continue the existing agreement by and between the City and Ceridian as an adjunct to the agreement previously approved by Resolution 06-09-5044 with Colonial Insurance to administer a Flexible Spending Account Program for the employees of the City of North Lauderdale.

Section 2: That this Resolution shall take effect immediately upon adoption.

PASSED and ADOPTED by the City Commission of the City of North Lauderdale, Florida this 13th day of September 2007.

APPROVED AS TO FORM:

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CITY ATTORNEY SAMUEL S. GOREN

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MAYOR JACK BRADY

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VICE MAYOR RICH MOYLE

ATTEST:

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DEPUTY CLERK PATRICIA VANCHERI