Bill Type and Number: Ordinance 2006-1364

Sponsor: Council President at the request of General Employees Pension Board of Trustees

Date of Introduction: November 28, 2006

Committee(s) of Reference: F

Date of Analysis: December 1, 2006

Type of Action: Ordinance Code amendment

Bill Summary: The bill amends Ordinance Code Chapter 120 – General Employees and Corrections Officers Pension Plan – to change the commencement date of retiree cost of living adjustments (COLAs) from April 1^st to January 1^st of the year in which eligibility begins.

NOTE: The bill contains two typographical errors on page 2, line 15 – “102.206” should be “120.206”.

Background Information: Retirees are entitled to receive a 3% COLA beginning in the 5^th year after their retirement. The commencement date for the COLA for any retiree achieving their 5^th year anniversary within a fiscal year is the first pay period after April 1^st of that fiscal year. This amendment would push the commencement date back 3 months to the first pay period after January 1^st for all retirees reaching eligibility within that fiscal year. The change will make the timing of the COLA coincide with the annual increase in health, dental and vision insurance premiums that take effect January 1 for retirees who continue to purchase those benefits after retirement. The pension system’s actuary calculates that the cost of the change will increase the City’s required pension contribution by 0.13% of payroll, or $316,260 in the first year of implementation.

Policy Impact Area: Pension benefits

Fiscal Impact: Estimated by the pension fund’s actuary at $316,260 in the year of implementation.

Analyst: Clements