LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE
The Legislative, Finance, and Administration Committee meeting was held on January 26, 2009 at 6:00 p.m. with Chairman Slavin presiding. Members present were Mr. McGlumphy, Mr. Salters, Dr. Jones, and Mr. Shevock. Other members of Council present were Mr. Leary and Mayor Carey.
AGENDA ADDITIONS/DELETIONS
Mr. Salters moved for approval of the agenda, seconded by Mr. Shevock and unanimously carried.
Actuary Presentation - Other Post Employment Benefit (OPEB)
Mrs. Mitchell, Controller/Treasurer, introduced Mr. Randy Gomez from Alliance Benefit Group who reviewed a Presentation of GASB 45 Results for 2008/09 (Attachment #1).
In reference to Mr. Slavin regarding the City’s current costs associated with healthcare coverage (100% responsible for employee; 75% responsible for employee’s spouse), Mrs. Mitchell indicated that this policy has been in effect for 20+ years. Mr. Gomez stated that this healthcare coverage benefit is very common in Delaware and the region, less common as you move westward in the country.
Mr. Gomez advised members that in the next 10 years, the City’s costs for healthcare coverage will double and explained the assumptions for this determination. He explained the advantages of pre-funding with an OPEB Trust and the City’s benefits for participating in the State’s health plan. He also explained other methods to manage liability.
Mr. Slavin noted that this is a very preliminary presentation and that it should not be misconstrued to indicate that the City is contemplating the elimination of or a change in benefits for employees and questioned the next step to be considered. Responding, Mrs. Mitchell explained that the City has taken the first step (10 year phase in) to allow the City to work through contract negotiations during the next three (3) to four (4) years. She advised members that the City is just beginning its first contract negotiations and that the plan is to negotiate through union contracts to provide the necessary cost savings.
Although there are costs associated with healthcare benefits, Mr. McGlumphy indicated his desire for the City to maintain providing health benefits as it is a critical and valuable benefit that government has been able to provide their employees. He requested that action be taken to allow the City to meet the requirements and provide healthcare benefits to the employees.
No further action was taken by the committee at this time.
Financial Advisor Services Contract
In accordance with the City of Dover Debt Management Policy, the Finance Department completed a solicitation for Financial Advisory Services. Mrs. Mitchell, Controller/Treasurer, advised members that four (4) proposals were received and reviewed. Based upon their review, staff recommended the selection of Public Financial Management, Inc. of Philadelphia, PA. Members were provided additional information regarding the financial advisor scoring sheet and list of rates and services. She reminded members that, as in the past, all fees related to these services are paid out of the bond proceeds and not budgeted as current expenses in the City budgets.
Staff recommended the approval of a five (5) year service contract for financial advisor services with Public Financial Management, Inc.
Dr. Jones moved to recommend approval of staff’s recommendation, seconded by Mr. Salters and unanimously carried.
Mr. Salters moved for adjournment, seconded by Mr. Shevock and unanimously carried.
Meeting Adjourned at 6:53 P.M.
Respectfully submitted,
Timothy A. Slavin
Chairman
TAS/AC/TM/jg
S:ClerksOfficeAgendas&MinutesCommittee-Minutes20091-26-2009 LF&A.wpd
Attachments
Attachment #1 - Presentation of GASB 45 Results for 2008/09