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08/28/1995 CITY COMMISSION SPECIAL MEETING August 28, 1995 The City Commission of the City of Clearwater met in special session at City Hall, Monday, August 28, 1995 at 9:00 a.m., with the following members present: Rita Garvey Mayor/Commissioner Sue A. Berfield Vice-Mayor/Commissioner Fred A. Thomas Commissioner J. B. Johnson Commissioner William Justice Commissioner Also present: Elizabeth M. Deptula City Manager Kathy S. Rice Deputy City Manager William C. Baker Assistant City Manager Pamela K. Akin City Attorney Mary K. Diana Assistant City Clerk Patricia Sullivan Board Reporter The Mayor called the meeting to order. ITEM #2 - Rescind 08/17/95 action to pass Ord. #5890-95 on First Reading On August 17, 1995, Ordinance #5890-95 (proposed amended Employees' Pension Plan) was presented to the City Commission for first reading. Staff felt the ordinance addressed each conceptual change the City and unions agreed to during collective bargaining that resulted in approval of union contracts for the current and next two fiscal years. During discussion, several union representatives expressed concern the proposal did not address correctly every concept. They indicated the proposed plan would have to be submitted to their membership for ratification. On August 17, 1995, the City Commission passed Ordinance #5890-95 but indicated the parties should attempt to resolve their differences. On August 21, 1995, union representatives met with staff and all concurred with an amended Pension Plan. The unions intend to seek ratification of the final product by their membership within several weeks. To place the Pension Plan before Clearwater voters on the October 24, 1995 referendum, it is necessary to approve the amended Pension Plan, and changes to Ordinance #5890-95, at this special meeting and on second reading on September 7, 1995. The action taken on this ordinance on August 17, 1995 is to be rescinded due to the changes and a new first reading of Ordinance #5890-95 will be required. Commissioner Thomas moved to rescind the August 17, 1995 action to pass Ordinance #5890-95 on first reading. The motion was duly seconded and carried unanimously. ITEM #3 - Approve Rewrite of Employee Pension Plan & pass Ord. #5890-95 on First Reading - Amending the provisions of Div. 3 of Art. 5 of the City’s Code of Ordinances, adopting a revised Employees’ Pension Plan, providing for a referendum election relating to the pension plan Deputy City Manager Kathy Rice said all the unions have signed off on the revisions to the Pension Plan and, as a whole, have agreed to take it to referendum. Ms. Rice said staff sent the language to the AARP attorney for review and approval as confusion and concern regarding the language relating to the AARP lawsuit had been expressed. The City is comfortable the terms of the agreement have been met. She said those employees involved in the lawsuit were compensated and it is felt the issue has been settled. Ms. Rice indicated if the plan is changed at this point, the City could not go forward in good faith. SAMP employees have been included in the meetings regarding the pension plan and a special edition of Clearwater Reflections was distributed to all employees to explain the proposed concept. She said the change is good for both the City and the employees. Ms. Rice reviewed the proposed changes to the ordinance as had been presented to the City Commission on August 17, 1995. The Pension Advisory Committee (PAC) will be the final authority on the determination of disability because the PAC will be changed from three members to seven members, three of which are elected by the employees in the plan, three Commissioners or Commission-appointed designees and one member appointed by the members. Commissioner Thomas recommended the City Commission by rule or adoption of an ordinance or resolution require City Commission membership on the PAC rather than allowing non-elected appointees. Mayor Garvey agreed with Commission membership; however, disagreed that requirement should be included in a resolution or ordinance. She felt that decision should be up to each Commission. The City Attorney indicated a rule stipulating those requirements could be changed by future commissioners. Commissioner Thomas agreed future Commissions should debate such a change. Commissioner Johnson questioned if the proposed change allows Commission members to designate representatives to sit on the PAC. Commissioner Thomas said it did. He recommended Commission membership as a check and balance as these positions have fiduciary responsibility. Commissioner Johnson indicated his preference that Commissioners fill the positions on the PAC. Mayor Garvey recommended adopting a policy after the citizens vote on the plan at referendum. Commissioner Justice supported Commission membership. The City Attorney indicated the rules of procedure or policy could be changed to address this concern. Consensus was to establish a rule or policy requiring Commission membership on the Pension Advisory Committee. Ms. Rice said there are language changes that will allow the committee to act independently regarding approval of disability claims. She reported current employee-elected members of the PAC will continue serving on the PAC until their respective terms expire. Ms. Rice said certain issues agreed to by the parties were to be included in a separate Memo of Understanding between the City and the unions. It was determined those issues could be included in the Pension Plan language instead. These issues relate to the City's indication that not less than eight positions within the Police Department and not less than five positions within the Fire Department in the hazardous duty category would be available for alternate assignment in lieu of disability; that sworn and/or certified police and fire personnel who are alternately assigned in lieu of receipt of a disability pension would still retain their rank designation; and that sworn and/or certified police and fire personnel alternately assigned to a non-bargaining unit position would have the right to return to a bargaining unit position on a first out, first in basis as any such positions became available. The Mayor questioned if those specific numbers should be included in the ordinance. Ms. Rice said the numbers could not be changed without going to referendum. Mayor Garvey expressed concern with including the numbers in the ordinance. Ms. Rice said the unions had indicated they were comfortable with the numbers identified. Commissioner Thomas questioned how the issue would be affected if the number of designated positions was changed. Ms. Rice said certain jobs in the Police Department can be handled by those with certain disabilities. She said currently a Police Officer can go out on a 75% disability for life if he/she cannot perform all duties required of a Police Officer. She said the Police Chief indicated he is comfortable with identifying eight positions for alternate assignment and the Fire Chief is comfortable identifying five. Commissioner Justice questioned if those departments could have additional alternate assignment positions if they wished. Ms. Rice indicated that was correct. She said the City did not want to hamper either department. Commissioner Berfield questioned if the proposed alternate assignment positions are current City positions. Ms. Rice said no new positions were being created. Commissioner Thomas questioned if the original plan regarding tiers remained valid. Ms. Rice said that was correct. The first priority would be to have the employee come back as a police officer, sergeant, paramedic, etc. If there is no position available, he/she would be placed in the department. The third priority would be to place the employee in the City. She said the number of alternate assignment positions was not limited to the number established in the ordinance. Van Horton, President of the Firefighters Union, said some members have expressed concern regarding the disability issue. He said his union is putting their faith in the decisions made by the PAC. They will have a great deal of responsibility regarding the placement of disabled employees. He reported the unions are holding informational meetings this week. He said he will take the changes to the members for ratification. He hoped the union favored the changes. Mayor Garvey questioned if he was comfortable with the changes. Mr. Horton indicated he was. Pete Fire, President of the Fraternal Order of Police, said his board agrees with the Pension Plan changes. He said he will take the issue to his union's membership in a positive manner. Mary McCann said she is a 25-year resident of Clearwater and has been a City employee for 16 years. She reported Mr. Snair was to have attended but was ill. She expressed concern the early retirement language does not reflect the agreement included in the AARP lawsuit. Ms. McCann felt the City could be open to another lawsuit. She felt the Pension Plan discriminates against senior citizens and explained her situation. She said she did not know what the term, "actuarially reduced" meant until the August 16, 1995 special edition of Clearwater Reflections was distributed. She felt it was unfair and left her with three choices. She could take the actuarially reduced amount at age 65, withdraw all the money she invested in the plan plus 5% interest or work until she is 75 years old. Pat Buzek distributed a handout. She said she is a Senior Accountant who has worked for the City for 16 years. She said she is grateful for her job and the opportunities for advancement. She said employees are disturbed regarding changes made to the Pension Plan. Ms. Buzek did not think the Commission understood the total picture. She indicated she was hired at age 47 but had to pay into the social security plan instead of the pension plan. After the lawsuit, she researched the social security and pension plan formulae and joined the pension plan. She said the changes would require her to work until she is 79 before she has 20 years in the pension plan. Overall, she will have worked for the City for 32 years. She expressed concern the 20 year mentality is live and well and felt the plan is an insult to all who are over age 45 when they are hired by the City. Ms. Buzek referred to her handout and explained her calculations extrapolated out to 1999. She would receive only 7% of the total contribution made to the plan by her and the City. As a SAMP employee, she felt no one negotiated on her behalf. She questioned why the information regarding the actuarial numbers was not distributed until the day before first reading. She expressed concern the minimum pension of $300 had been repealed. She pointed out life insurance for SAMP employees is reduced to $1,500 at age 65. She expressed concern retirement gifts are presented only after 20 years of service. She felt excluding retirees from City health insurance benefits who had not worked at least 20 years for the City was against the Florida Statutes. She requested the City Commission make a statement for equality. She requested removing the actuary language and changing credited service to reflect employment date. Ms. Buzek said in 1994, the pension costs for Pinellas County were more than 28% of the budget while the City's costs were 6.6%. She said the City's plan is economical. Ed Hooper, PAC Chairman, felt the City Commission had been misinformed regarding some issues addressed by Ms. McCann and Ms. Buzek. As the plan currently stands, an employee who retires and does not have or 20 years of service is not entitled to any pension until their 20th anniversary. There had been discussion whether there should be consideration for granting an actuarially reduced benefit for older workers who would reach 65 years before 20 years of service. No group objected to that philosophy. He felt senior workers should receive benefits based on years of service and noted most City workers do not qualify for Social Security because they had not contributed to that plan. He noted the actuary numbers are based on educated guesses. He said the plan provides benefits at a reduced level to employees who retire at age 65 before completing at least 20 years of work with the City. Ms. Rice said she understands the concerns expressed by Ms. McCann and Ms. Buzek. She said the actuarial was distributed at the union's request. The Mayor questioned if the language was acceptable to AARP. Ms. Rice said the AARP attorneys have seen the language. She felt the City has done everything the AARP agreement requires. The City Attorney agreed. Commissioner Thomas felt the City's Pension Plan was liberal but expressed concern regarding representation of SAMP employees. He indicated this proposal would harm more than 45 employees. He noted unions protect workers' interests but SAMP employees are represented only by the City Manager. He said no one bargains on behalf of SAMP employees. Commissioner Thomas expressed concern another labor union would form if SAMP employees are harmed by this plan. Ms. Rice said the majority of SAMP employees are not in the pension plan and this group is generally made up of employees that cannot be in a bargaining unit. She felt that SAMP is well represented and well taken care of. Commissioner Thomas expressed concern Ms. Buzek contributed to Social Security for years before she was allowed into the Pension Plan and would have to work until approximately age 70 before becoming vested. Ms. Rice agreed and said the issue is complicated. She reported 18 employees who were part of the AARP lawsuit still work for the City. Commissioner Thomas expressed concern that older employees made pension decisions without all pertinent facts. He felt if the plan is unfair to any employee, it is wrong. Commissioner Johnson questioned how the plan was unfair. The City Attorney believed, from a legal standpoint, the plan to adjust benefits actuarially is not unfair. She said the City is trying to accomplish an equal benefit for all. Commissioner Justice noted a 10-year vesting is common. The Pension Plan, based on twenty years of employment, will offer older retiring workers reduced benefits prior to that date. Ms. Rice said the older employee who retires after working only 10 years will receive their benefits years early, in a reduced amount. Commissioner Thomas said a Pension Plan should pay out a combination of principle and interest indicating the City’s did not. Commissioner Johnson felt the plan was fair if people receive benefits as predicted by the actuaries. Commissioner Thomas felt those employees who are over 45 years old when they begin City employment are penalized by receiving reduced benefits. The City Attorney said their pension would depend on the actuary. Mr. Hooper offered as an example a 65 year old retiree married to a 25 year old spouse who could collect on the pension for many years. He said the actuary is based on all pension plan members and not any one individual. He said the issue is not one of discrimination. Commissioner Justice noted the formula is similar to the one used by the Pinellas County School Board. Mayor Garvey questioned if he thought the plan was fair. Commissioner Justice thought the plan represented a fair compromise. The City Manager noted the disagreement is not a SAMP issue but involves all employees who are older than 45 when they begin working for the City . She wanted to be clear that the plan is not unfair to SAMP employees. Ms. Rice said the group of senior employees is almost evenly split between union and SAMP positions. Commissioner Thomas said he was concerned with being fair to senior citizens. The City Manager noted many senior employees are represented by the CWA which has signed off on the proposed Pension Plan. The City Attorney presented Ordinance #5890-95 for first reading and read it by title only. Commissioner Berfield moved to pass Ordinance #5890-95 on first reading. The motion was duly seconded. Commissioner Berfield questioned if older employees currently can receive pension benefits before they have been in the plan for 20 years. It was indicated they cannot. Commissioner Berfield indicated Mr. Snair had requested she check the pension language with attorneys, which she did. Upon roll call, the vote was: "Ayes": Berfield, Johnson, Justice and Garvey. "Nays": Thomas. Motion carried. ITEM #4 - Approve Change to Commission and Mayor Salaries and Pass Ord. #5915- 95 on First Reading Commissioner Johnson said he had received a number of calls commending the City Commission for taking a position regarding this issue. The City Attorney presented Ordinance #5915-95 for first reading and read it by title only. Commissioner Johnson moved to pass Ordinance #5915-95 on first reading. The motion was duly seconded. Charles LeCher felt the Commission should receive a pay raise and suggested a larger increase. He said, without a pay raise, the City Commission will remain status quo. He said the positions need to provide a livable wage so a greater number of citizens will run. He noted the Pinellas County Commission's pay is based on population. Mr. LeCher indicated high ranking City employees earn good salaries. He recommended basing an increased rate on census figures and increasing it automatically every ten years when the new figures are reported. Jamie Wilson felt the City Commission does not serve for financial gain and noted the increase being discussed is minimal. He did not feel the recommended increase would entice younger people to seek office. Mr. Wilson did not think the position should be full-time and felt it was admirable the City Commission did not expect full-time compensation. As a taxpayer, he opposed the increase. Ed Hooper indicated he was applauded by a packed Chambers when he recommended an increase two years ago. He felt the increase was a step in the right direction but still would not compensate the Commissioners for all the time they spend tending to City business. Mr. LeCher said it would be difficult to expect City Commissioners to meet with concerned citizens if they must hold another job. Lois Cormier recommended the City Commission consider a larger raise. She indicated Commissioners spend a great number of hours dealing with Commission business as well as serving on the Pinellas Planning Council, the Metropolitan Planning Organization, etc. She favored the increase and felt the action was overdue. Hoyt Hamilton said the raise was well deserved but agreed with Commissioner Thomas that the increase should be greater. He agreed the position is not a full-time job. He recommended the Commission consider changing the City form of government to one with a strong Mayor. He indicated younger people cannot consider serving on the Commission because they cannot support a family at the current or proposed salary. The Mayor noted the County Commissioners' salaries are increased by State law. Commissioner Thomas supported increasing the salaries to increase the number of candidates. He said what is being proposed merely panders to the interests of those currently on the Commission and will not change the dynamics of the Commission. He agreed the pay structure should be sufficient to attract a broad number of citizens. He pointed out that no one could survive on $15,000 per year. He noted previous Commission members have been retirees and homemakers. He referred to a St. Petersburg Times' article stating that city commissions are getting older and cities are being run by those who are no longer raising a family. He recommended establishing a pay scale that would attract all Clearwater citizens to serve. Commissioner Thomas spoke against tokenism and recommended a higher salary. He said the Commission owed it to the City and citizens to broaden the casting net to attract residents to public service. Commissioner Thomas moved to amend Ordinance #5915 95 to reflect an increase to $30,000 for Commissioners and $35,000 for the Mayor. There was no second. The Mayor said Commission members are not serving to enrich themselves. She noted homemakers perform many duties for which they are not paid. Commissioner Justice agreed with Commissioner Thomas' suggestion that the positions are worth more but he did not feel the City is in the position to raise the salaries to that level. He recommended increasing the salaries a little at a time. He agreed the job deserves greater compensation. Commissioner Johnson said he respected Commissioner Thomas’ opinions but disagreed with the remark that Commissioners who support the proposed increase are pandering. Commissioner Berfield agreed an increase was needed. She indicated the City Commission earns their salaries. She felt one's ability or inability has nothing to do with one's age. She agreed those who seek office do consider the salary. Commissioner Berfield indicated she works full-time but has the luxury of a flexible schedule. She said all individuals need to decide if they can make the commitment. She wanted to go beyond the age issue. Commissioner Berfield noted the Charter Review Committee had looked at a strong mayor form of government but chose to stay with the current one. She recommended establishing a time frame when this issue would automatically be reviewed again. Upon roll call, the vote was: "Ayes": Berfield, Johnson, Justice and Garvey. "Nays": Thomas. Motion carried. ITEM #5 - Adjournment The meeting adjourned at 10:31 a.m.