CITY OF
HUMAN RESOURCES DEPARTMENT
TO: Honorable Mayor and
Commissioners
FROM:
BY: Ernest King, Human Resources
Director
DATE: September 13, 2007
RE: Employee Group Insurance
Renewal - Fiscal Year 2007/08
Currently, the City has independent agreements with five vendors for our employee group insurance. These vendors and associated benefits are listed below:
|
Vendors |
Benefit |
|
|
Health and Vision |
|
Comp Benefits |
Dental |
|
Reliance |
Life Insurance |
|
Reliance |
Long-Term Disability Management |
|
|
Long-Term Disability Non-Management |
Health/Vision
The City’s contract for group Health and Vision insurance expires on September 30, 2007. Florida League of Cities (FLC), utilizing United Healthcare network, currently provides group health insurance coverage to City employees. It also provides vision insurance through Vision-Care.
Based on FLC’s proposal for this year, the amount estimated and allocated in FY 07/08 budget ($1,376,852) is actually $23, 988 less than the amount budgeted in 06/07 which was $1,400,640.
According to our year end projections, the actual City cost for FY 06/07 is approximately $1,206,192. ($194,448 under budget) This decrease is associated with the proactive budgetary constraint measures implemented by the City Administration in anticipation of the impact of the Property Tax Reform legislature. In addition, this decrease is associated with staff reductions due to outsourcing of various services.
The budgeted amount for FY 07/08 ($1,376,852) is inclusive of a 13.90% increase in the rate. FLC initially proposed a rate increase of 24.00%. However, due to staff’s diligent negotiations, we were able to reduce the rate to 13.90% for the City’s current group Health Insurance Plan and no increase for Vision Insurance Plan as illustrated in the following table.
|
Group
Health Monthly Rates |
Current 06/07
|
Proposed 07/08
|
|
Employee (only) |
376.66 |
429.02 |
|
Employee + Spouse |
818.24 |
931.97 |
|
Employee + Children |
713.10 |
812.23 |
|
Family |
1,154.67 |
1,315.18 |
Vision Monthly Rate
|
Current 06/07
|
Proposed 07/08
|
|
Employee (only) |
5.74 |
5.74 |
|
Employee +1 |
14.17 |
14.17 |
|
Family |
28.34 |
28.34 |
The health insurance
rate increases for FY 05/06 and FY 06/07 were 4% and 10% respectively.
Dental
The City’s contract with American Dental/Comp Benefits for dental insurance expires on September 30, 2007. Comp Benefits has proposed to renew our current Dental Plan (CS 250) with no increase from 2006/07 rates as indicated in the following table:
Dental Monthly Rates
|
Current 06/07
|
Proposed 07/08
|
|
Employee Only |
11.14 |
11.14 |
|
Employee + 1 |
21.16 |
21.16 |
|
Employee + Family |
28.30 |
28.30 |
Life Insurance
On September 30, 2007 the Group Life insurance policy with Reliance Standard Life Insurance expires. According to the City’s Broker for Group Life insurance, Dan Rachman, Reliance Standard Life Insurance will renew our Group Life insurance and Accidental Death and Dismemberment (AD&D) with no rate increase. The current rates are $0.30/$1000 for Life and $0.06/$1000 for Accidental Death and Dismemberment.
The Group Life Policy currently provides basic life and accidental death and dismemberment coverage for each active, full-time employee after one month of employment with the City, according to the following classifications:
|
Class |
Employee Group |
Death Benefit |
|
Class 1 |
Department Heads and Commissioners |
$100,000 |
|
Class 2 |
Fire Employees |
$25,000 |
|
Class 3 |
General Employees |
$50,000 |
|
Class 4 |
Federation of Public Employees members |
$50,000 |
|
Class 5 |
Retirees |
$10,000 |
Retiree’s Life insurance automatically
defaults to $10,000. Retiree’s pay 100%
of premium for Life
Insurance. The City pays the full cost of Group Life
insurance and AD&D insurance for active employees.
LTD Management
On September 30, 2007 the Long-term Disability (LTD) Policy for management personnel provided by Reliance Standard Life Insurance expires. According to the City’s Broker for management personnel Long-term Disability insurance, Dan Rachman, Reliance Standard Life Insurance will renew our policy with no rate increase.
This policy covers each active, full-time employee who is exempt from overtime and compensatory time in accordance with the Fair Labor Standards Act, except for temporary employees.
The following table illustrates the management Long-term Disability policy benefits:
|
Age at
Disablement |
Duration of Benefits |
|
Under 60 |
Up to age 65 |
|
From 60-69 |
5 years or up to age 70, whichever is less |
|
69 or older |
12 Months |
The City pays the full cost of this policy
at a rate of $0.76/$100 of covered payroll.
LTD Non-Management
On September 30, 2007 the Long-term Disability (LTD) Policy for non-management personnel, provided by Jefferson-Pilot Financial, expires. Jefferson Pilot has proposed to renew the City’s policy with no rate increase.
|
Age at
Disablement |
Duration of Benefits |
|
Under 60 |
Up to age 65 |
|
From 60- 69 |
5 years or up to age 70, whichever is less |
|
69 or older |
12 Months |
The City pays the full cost of this policy at a rate of $0.83/$100 of
covered payroll.
RECOMMENDATION
The City Administration recommends Commission’s consideration and
approval of the attached Resolution authorizing the City Manager to renew the
City’s Group Insurance contracts for fiscal year 2007/2008 with:
RESOLUTION NO.
A RESOLUTION OF THE CITY COMMISSION OF THE
CITY OF NORTH LAUDERDALE, FLORIDA, AUTHORIZING THE CITY MANAGER TO ENTER INTO
RENEWAL CONTRACTS BY AND BETWEEN THE CITY OF NORTH LAUDERDALE AND THE FLORIDA
LEAGUE OF CITIES, COMP BENEFITS, RELIANCE STANDARD AND JEFFERSON PILOT
FINANCIAL FOR EMPLOYEE GROUP INSURANCE AS OUTLINED IN SECTION 1 OF THIS
RESOLUTION FOR FISCAL YEAR 2007/2008;
AND PROVIDING AN EFFECTIVE DATE.
BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF
Section 1: That the City Commission of the City of North Lauderdale, Florida, does hereby authorize and direct the City Manager, on behalf of the City, to execute agreements by and between the City of North Lauderdale and Florida League of Cities, Comp Benefits, Reliance Standard and Jefferson Pilot Financial as follows for fiscal year 2007/2008 effective October 1, 2007:
Comp Benefits for Group Dental Insurance
Reliance Standard Life for Group Life Insurance
Reliance Standard Life for Management Long-Term Disability
Section 2: That this Resolution shall take effect immediately upon adoption.
PASSED and
ADOPTED by the City Commission of the City of
APPROVED AS TO FORM:
CITY ATTORNEY SAMUEL S. GOREN
MAYOR JACK BRADY
ATTEST:
VICE MAYOR RICH MOYLE
_____________________________________
DEPUTY CLERK PATRICIA VANCHERI