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11/10/1987CITY COMMISSION SPECIAL MEETING November 10, 1987 The City Commission of the City of Clearwater met in special session at the City Hall Large Conference Room, Tuesday, November 10, 1987, at 1:07 p.m., with the following members present: Rita Garvey Mayor/Commissioner Lee Regulski Commissioner Don Winner Commissioner William Nunamaker Commissioner Absent: James L. Berfield Vice-Mayor/Commissioner Also present were: Joseph R. McFate II Interim City Manager Gerald Weimer Assistant City Manager M. A. Galbraith, Jr. City Attorney Mike Laursen Personnel Director Dan Deignan Finance Director Shirley A. Corum Assistant City Clerk The Mayor called the meeting to order and the following item was discussed: Pension Rewrite The Board of Trustees shall have the authority to overrule any decision of the Pension Advisory Committee on the granting, denial, or modification of any pension upon the concurrence of not less than four-fifths of the trustees. The Finance Director stated he would like to address the issue of the four to one vote. He objects to the diminished authority of the Board of Trustees because: 1) this violates the intent of Chapter 112 of Florida Statutes; 2) the existing ordinance clearly shows no intent for the Pension Advisory Committee to make final decisions; and 3) any decisions affecting taxpayers should be made by elected officials. He suggested an automatic hearing be held when the Board of Trustees decision differs from the Pension Advisory Committee's recommendation. John Nicholson, of the Pension Rewrite Committee, stated he had also proposed an administrative hearing be held whenever there is any question of disability. However, he suggested the hearing be held before the Pension Advisory Committee prior to the Board of Trustees' consideration of the disability. Discussion ensued regarding the advantages of having a hearing prior to any vote being taken. It could be a formalized way to make a determination as to disability. It was emphasized, however, that all of the trustees should have equal information with no bias when considering a person's disability. The Finance Director stated in 90% of the disability cases there is no disagreement; the hearing should be held only when the Pension Advisory Committee's recommendation differs from the Board of Trustee's decision. He emphasized, however, that the determining vote should be three/two, not four/one. Also discussed was whether the hearing should include the power to subpoena witnesses. Several of the Pension Rewrite Committee members feel the Pension Advisory Committee would need subpoena powers to hold this administrative hearing. The Personnel Director stated the Pension Advisory Committee presently does not have subpoena power. Sometimes even the employee whose pension is being considered does not attend, there are no witnesses, no transcripts of the hearing, and not all conversations regarding the person's disability are recorded. Mayor Garvey stated if the hearing is held before the Board of Trustees, she could agree to the four/one override vote. Discussion ensued regarding the problem with police and fire employees needing state certification in order to do their jobs; even a minor injury can prevent them from continuing their state certification. Commissioner Regulski pointed out that his original suggestion in making the four/one override vote was that it should be for disability pension determination only and not all pensions. Commission consensus was that the four/one override vote would be for disability only; all other votes would only require a three/two vote. This changes the ordinance (page 6, Sec. 26.33) to read: the Board of Trustees: (2) shall have the authority to overrule any decision of the Pension Advisory Committee on the granting, denial or modification of any disability pension upon the concurrence of not less than four-fifths of the Trustees. "Any other decision of the Pension Advisory Committee can be overruled by a vote of three/two." Commission consensus was that the Pension Advisory Committee hold a hearing, with subpoena and legal powers, prior to a disability pension recommendation being submitted to the Board of Trustees. This changes the ordinance (page 9, Sec. 26.33.01) (d) The Pension Advisory Committee shall: (1) Establish procedures necessary to carry out its duties and obligations. "An administrative hearing regarding disability pension shall be held, with full subpoena and legal powers, prior to the disability pension recommendation being submitted to the Board of Trustees. If no hearing is held, the Board of Trustees, by a three/two vote, can remand the disability recommendation to the Pension Advisory Committee in order that a hearing be held." The Finance Director pointed out the language in the Ordinance has been changed to provide that the Pension Advisory Committee makes decisions rather than recommendations. Discussion ensued regarding leaving in decide or changing it back to recommend. Commission consensus was that decide could be used, but (on page 10, Sec. 26.33.01) to add: the Pension Advisory Committee shall (7) Decide whether pension benefits shall be granted, denied or modified, and immediately notify the trustees and the employee of the decision, "subject to a further decision by the Board of Trustees". Also on page 10, the Pension Advisory Committee shall: (3) Require, at its discretion or when requested by the trustees, an annual review of the medical status of any recipient of disability benefits by an approved physician (M.D. or D.O.) to determine if disability benefits should continue. The Committee may obtain all information necessary to make a determination as to whether disability benefits should continue, including but not limited to wage, medical, and income tax records, the cost of obtaining which shall be borne by the pension plan. Commission consensus was to add a procedure for notifying the employee and to provide a hearing whereby the employee would have the right to defend his medical status. Issue of whether the revised pension plan would apply to all employees Discussion ensued regarding the expense of allowing two pension plans to operate simultaneously. The City Attorney stated a section could be added to the pension ordinance on retroactivity. Mike Stuart, of the Pension Rewrite Committee, stated everyone should be included under the new plan effective upon adoption of the ordinance. However, it should be made clear that no present benefits would be removed from employees currently receiving pension benefits. Commission consensus was there would be no grandfathering of the old plan, everyone would be covered under the new plan; however, no present retiree benefits would be reduced, with the exclusion that, if a retiree receiving disability benefits recovers, he will lose his disability benefits. The Assistant City Manager pointed out the pension ordinance should reference the IRS code as the plan needs to be qualifiable in order to prevent employees having to pay income tax on the City's contributions to the pension plan. Section 26.35 Pension benefits - Employee connected disability (page 12). (c) If an employee receiving a disability pension receives additional earned income as a result of engaging in any other occupation, the disability benefit shall be reduced annually by 30% of the amount by which the basic disability benefit (excluding additional benefits for dependents) plus additional earned income exceeds the final 12 months salary of the employee . The Finance Director pointed out this provision will result in an administrative burden on the Finance Department. He stated the 30% is insufficient to deter abuses to the system. Discussion ensued regarding changing the 30% to 50% to make it more of a deterrent. Mike Stuart pointed out the penalty provision encourages retirees to work illegally and not report income. Charlie Dunn stated that, if the amount is changed to 50%, City employees will vote against it and will campaign to get the public to also vote against it. Commission consensus was to change the percentage from 30% to 50%. Section 26.30 - Creation and coverage (page 2). (a) (4) Regular retirement benefits for employees who reach age 65 while still employed regardless of years of plan participation, provided however, that the minimum pension benefit as provided by Section 26. 38 shall not apply. It was pointed out that an employee could be hired at age 64, leave at age 65 and receive pension benefits of 2-1/2% of final year' s salary times one year of employment. Miles Lance stated a memo has been received from the EEOC and the State stating that social security benefits could be recomputed back three years if error is shown. Gerald Weimer pointed out the City should be very careful in making the plan apply to employees hired after age 45, as this is a legal question that needs review by the Legal Department. He suggested the age 45 requirement be removed for new hires, but no current employees be allowed in at this time because of possible lawsuits. Commission consensus was to eliminate the age 45 requirement and to allow the City Attorney to check with the City's labor counsel regarding retroactivity. The City Attorney stated he would be preparing one ballot question which would basically provide for amending the pension plan. Van Horton questioned whether there would be meetings to explain the revised pension plan ordinance. He also questioned whether it would be an option to allow the plan to be negotiated by the unions. The City Attorney stated if the plan is a negotiated item, the process should stop and it should not go to referendum. A question was raised regarding whether state law prohibits Commissioners from serving as trustees of the pension plan. Miles Lance, Assistant City Attorney, was directed to check into this. A question was raised whether overtime is included in the definition of salary under state law. Currently, overtime is included in the City's salary definition. Miles Lance stated overtime is excluded by state law and he feels this could become a problem. It was determined that clarification be sought by Miles Lance. It was questioned whether some form of time limit for reasonable action by the Pension Advisory Committee and the Board of Trustees be included in the ordinance. Consensus was that language regarding "the prudent man rule" be included in the ordinance. A question was raised whether the Pension Advisory Committee, which will be comprised of five members, should have a prohibition as to the number of members from any one department. Discussion ensued regarding too many members from one department being allowed to vote as a block. Steve Zimmerman stated he felt no more than one person from a department should be represented on the Committee. Mike Stuart stated this presents constitutional problems regarding a person's right to run. Commission consensus was not to place a prohibition on the number of members from any one department. The Pension Rewrite Committee was directed to continue their meetings. Other Business The City Attorney stated there was a problem with the advertising for the second reading ordinances to be heard on November 19th. The date advertised was November 5th; and due to the fact that the notices are required to be published ten days prior, all second reading ordinances will be continued to the meeting of December 3, 1987. Since the alcoholic beverage ordinance was one of the second reading ordinances, the City Attorney recommended a special meeting be set to pass and adopt this ordinance. Commission consensus was to set a special meeting for Tuesday, December 1st at 6:30 p.m. for second reading of the alcoholic beverage ordinance, Ordinance 4420-87. The Interim City Manager stated the City Manager of Safety Harbor informed him the Safety Harbor City Commission is still anxious to meet with the Clearwater City Commission. They are suggesting a meeting be set for December 1st or 8th at 7:00 p.m. at a neutral place, such as Countryside High School, with a moderator present. Mayor Garvey stated she disagrees with the use of a moderator but the Commission could agree to meet with the Safety Harbor City Commission on December 8th at Countryside High School. The Interim City Manager stated he would discuss this with the City Manager of Safety Harbor. The meeting adjourned at 4:19 p.m.