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05/31/1994 TRUSTEES OF THE EMPLOYEES' PENSION FUND MEETING May 31, 1994 The City Commission, meeting as the Board of Trustees of the Employees Pension Fund, met in regular session at City Hall, Tuesday, May 31, 1994 at 9:04 A.M., with the following members present: Rita Garvey Chairperson Richard Fitzgerald Trustee Sue Berfield Trustee Arthur X. Deegan, II Trustee Fred Thomas Trustee Also Present were: Elizabeth M. Deptula City Manager Alan S. Zimmet Interim City Attorney Cynthia E. Goudeau City Clerk ITEM #2 - Minutes: Trustee Fitzgerald moved to approve the minutes of the May 16, 1994, meeting. The motion was duly seconded and carried unanimously. ITEM #3 - Request for Acceptance into Membership: The City Manager presented the recommendation of the Pension Advisory Committee to approve membership for the employee(s) listed below: a) Michael England b) Laura Spellman c) Sharon Fisher d) J. Christopher Brown e) John Witkowski f) Jimmy Wrenn g) Adam Athan h) Jennifer Tudor i) David Roberts j) Gregory A. Smith k) Geraldine Blakley Trustee Thomas moved to accept the recommendation of the Pension Advisory Committee. The motion was duly seconded and carried unanimously. ITEM #4 - Request for Pension: The City Manager presented the recommendation of the Pension Advisory Committee that Bruce Bechtel be granted a regular pension under Section 2.396 of the Employees' Pension Plan. Bruce Bechtel was employed on August 13, 1973, and began participating in the Pension Plan on February 13, 1974. His retirement will be effective on May 14, 1994, at the beginning of the day. Mr. Bechtel's pension was approved by the PAC at its meeting of May 4, 1994. Based on an average salary of approximately $31,999 over the past five years and the formula for computing regular pensions, Mr. Bechtel's pension will approximate $16,200 annually. Charts from Finance which take into consideration mortality rates and age reflect the "present value cost of financing" this pension will be approximately $142,413. Note: When Mr. Bechtel was originally employed, pension deductions were not taken for the first six months and employees contributed to Social Security. When employees were given the option to buy back their first six months of service, Mr. Bechtel chose not to exercise such option. Trustee Fitzgerald moved to accept the recommendation of the Pension Advisory Committee. The motion was duly seconded and carried unanimously. ITEM #5 - Other Business: a) Job-Connected Disability Pension - Donald McMullen The City Manager presented the recommendation of the Pension Advisory Committee that Donald McMullen be granted a job-connected disability pension under Section(s) 2.397 and/or 2.399 of the Employees' Pension Plan. Donald McMullen was employed on June 30, 1986 and began participating in the Pension Plan on August 18, 1986. On May 7, 1993, he injured his back in a police cruiser accident while working which is the basis for his request for this job-connected disability pension. Mr. McMullen has submitted letters from Dr. Brian Oliver, dated March 8, 1994; Dr. William Dodson, dated March 15, 1994, and February 14, 1994; Dr. H. B. Angstadt, dated February 25, 1994; and Dr. Joseph Sena, dated March 3, 1993; and an MRI report dated June 25, 1993, in support of his request for a disability pension. This pension will be effective at the expiration of his vacation and sick leave as prorated with Workers' Compensation. Mr. McMullen's pension was approved by the PAC at its meeting of April 6, 1994. On May 2, 1994 the Trustees of the Employees' Pension Plan considered this request and remanded it to the PAC for further review. On May 4, 1994 the PAC voted to send Mr. McMullen for an Independent Medical Evaluation (IME). On May 16, 1994 Mr. McMullen was examined by Dr. William Greenberg. The report from Dr. Greenberg states, "Mr. McMullen carries the diagnosis of a herniated disk syndrome ... these restrictions would be limited lifting no more than 20-30 pounds, limited bending. Reviewing the job description of a police officer, I feel he would have difficulties in meeting the requirements. This would primarily be encountered in emergency situations, for example, during interventions, reacting quickly in emergencies due to his back problem." At its meeting on May 18, 1994 the PAC reviewed the IME report and voted to send this back to the Trustees for review. This request is being submitted to the Trustees at this time for approval of the job-connected disability pension for Donald McMullen. Based on an average salary of approximately $36,513 over the past five years and the formula for computing job-connected disability pensions, Mr. McMullen's pension will approximate $27,385 annually. Charts from Finance which take into consideration mortality rates and age reflect the "present value cost of financing" this pension will be approximately $355,124. H. M. Laursen, Human Resources Director, reiterated that based upon the IME by Dr. Greenberg, the PAC is again recommending approval of a job-connected disability pension for Mr. McMullen. Bob Walker, attorney representing Mr. McMullen and the Fraternal Order of Police (FOP), stated the law should be followed. He stated he understands the problems the Trustees and others are having with the disability portion of the Pension Plan, however, it is the law at this time. He reported Mr. McMullen has been working at a light duty assignment for the past month but even this is a strain on Mr. McMullen. He stated five medical experts have indicated Mr. McMullen is permanently disabled. Trustee Thomas questioned if the PAC had reviewed Mr. McMullen's file in Risk Management. Ed Hooper, member of the PAC, indicated they had not. Trustee Thomas questioned whether or not that would have been appropriate. Mr. Hooper indicated the PAC only considers the medical evidence. Trustee Thomas stated the file on Mr. McMullen in Risk Management is quite thick and contains information that Mr. McMullen has been rejected by workers' compensation. He expressed concern that Mr. McMullen is only 32 years old and will be receiving disability payments for the remainder of his life which could impact the taxpayers over $1 million. He felt it should be required that the doctors review the Risk Management file. He stated he had requested a continuance of this item as Dr. Greenberg's letter stated he did not have all of the information available. He stated he had concerns regarding there having been adequate pain testing in this case. Mr. Hooper indicated the PAC considered the six medical evaluations that Mr. McMullen could no longer be a police officer. Trustee Thomas questioned how the PAC could make a decision if all the facts were not in front of them. Mr. Hooper again indicated the PAC only goes by the medical determination and they do not deal with all workers' compensation materials. Trustee Thomas suggested the case be remanded for further review so the doctor has a chance to review all the data. Chairperson Garvey questioned from where Trustee Thomas was obtaining the $1 million figure. Trustee Thomas indicated he took the yearly pension payment and multiplied it by 40 years as a standard life span is 72 and Mr. McMullen is only 32. Chairperson Garvey pointed out this was not the information provided in the agenda item. She questioned if other Trustee members wished to remand the pension. Trustee Deegan indicated the difficulty with the numbers presented is that the numbers in the agenda item are based on present value. He stated the fiscal impact could be talked about in either the million dollar amount Trustee Thomas is referencing or the amount shown in the agenda item. He referenced the Policy and Procedures Manual for the PAC which states the PAC shall review the workers' compensation file. He felt one step in the process had not be followed. He also questioned where in the law on job connected disability it referenced an employee being permanently incapacitated for "this job". Mr. Laursen indicated the ordinance does not say "job" but rather refers to "duties". Trustee Deegan indicated that this reference is not made in the section on disability pension. Mr. Laursen stated the non-job-connected disability refers to their duties. Mr. Hooper read a portion of Section 2.396 which referenced a person being incapable of performing their duties. Trustee Deegan felt that section should have been referenced versus Section 2.397 if that was the verbiage they were using. Trustee Thomas again stated he was requesting this be remanded because the doctor's evaluation was not complete and the PAC had not reviewed the workers' compensation file. Trustee Berfield pointed out that the section regarding non-job-connected disability requires 10 years of continuous service. The Interim City Attorney indicated that did refer to a non-job-connected disability. Chairperson Garvey stated this confusion points out the need to clean up the pension ordinance. Mr. Hooper stated that was a point on which all parties could agree. He stated negotiations regarding changes to the Pension Plan are on-going. Trustee Fitzgerald indicated that all agree the whole area of the disability pension needs to be reviewed, however, he did not feel that issue could be solved with this case. He did not feel it would accomplish anything to remand this case again. Trustee Fitzgerald moved to approve a job-connected disability pension for Donald McMullen. The motion was duly seconded. Upon the vote being taken; Trustees Berfield, Fitzgerald, Deegan, and Garvey voted "Aye," Trustee Thomas voted "Nay." Motion carried. Chairperson Garvey requested the PAC look at how they determine a job-connected disability. Mr. Hooper indicated a procedure is now in place for Leo Schrader, Risk Manager, to provide all information he feels appropriate. Trustee Thomas questioned if the re-write of the pension code was aggressively being pursued. Mr. Hooper indicated it is the only topic that has been discussed thus far in union bargaining. Kathy Rice, Deputy City Manager, indicated meetings have been scheduled through the summer. She stated she has agreed with the three unions in concept regarding the pension plan and the attorneys are writing the language. She stated the unions have listened to what the Trustees have said regarding the disability pension. Mr. Hooper stated they understand the concern and he hoped that no one thought the PAC simply rubber stamps disability pensions. Trustee Thomas stated his problem was that the entire file on the employee was not reviewed by the PAC or the doctors. He did not feel the job had been done correctly. ITEM #6 - Adjournment: The meeting adjourned at 9:34 a.m.