HomeMy WebLinkAboutItem 17 - Public Agencies Retirement Services MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL 2
FROM: BRUNO RUMBELOW, CITY MANAGER \JCL
MEETING DATE: OCTOBER 18, 2016
SUBJECT: RESOLUTION ADOPTING RETIREMENT SERVICES POST-
RETIREMENT HEALTH CARE PLAN TRUST, APPROPRIATE
AND TRANSFER FUNDS AND AUTHORIZE EXECUTION
RECOMMENDATION:
It is recommended that the City Council:
1. Adopt the attached Resolution adopting the Public Agencies Retirement Services
(PARS) Post-Retirement Health Care Plan Trust as part of the City's program of benefits
in order to provide a funding source for retiree health care benefits in response to
Governmental Accounting Standards Board Statement 45 (GASB 45);
2. Authorize the appropriation and transfer of$500,000 to PARS for the purpose of funding
the Trust; and
3. Authorize the City Manager to execute the necessary documents that are necessary to
incorporate the Trust as part of the City's program of benefits in accordance with GASB
45.
FUNDING SOURCE:
Upon approval of the attached appropriation ordinance funding for this program will be
available in (600-11300-23) the Trust and Agency Fund. Fees are based on the fund's
value. If approved, the City will pay $3,000 or 0.60 % of$500,000 in fees.
BACKGROUND:
Government Accounting Standards Board Statement 45 (GASB 45), requires the City to
account for its Other Post Employment Benefits (OPEB) which are the City's retiree
healthcare and death related benefits.
The Government Finance Officers Association recommends that governments establish
an OPEB trust to fund retiree health obligations.
If approved, there will be no change to benefits, and the City will have access to the trust
funds at any point in time to pay for retiree healthcare costs. This action establishes a
October 12,2016(3 32PM)
formal reserve fund for retiree health care, and it provides a positive balance to offset the
long-term reportable liability required by GASB.
Staff recommends approval.
GSJ
October 12,2016(3:32PM)
RESOLUTION NO,
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS, AUTHORIZING THE CITY MANAGER OR
THE CITY MANAGER'S DESIGNEE TO CREATE AN OTHER
POST EMPLOYMENT BENEFIT (OPEB) TRUST AND PROVIDING
AN EFFECTIVE DATE
WHEREAS it is determined to be in the best interest of the City of Grapevine (the
"City")to participate in the PARS Public Agencies Post-Retirement Health Care Plan Trust
(the "Program") to fund post-employment benefits for its employees as specified in the
City's policies and/or applicable collective bargaining agreements; and
WHEREAS the City is eligible to participate in the Program, a tax-exempt trust and
plan performing an essential governmental function within the meaning of Section 115 of
the Internal Revenue Code, as amended, and the Regulations issued thereunder, and is
a tax-exempt trust under the relevant statutory provisions of the State of Texas; and
WHEREAS the City's adoption and operation of the Program has no effect on any
current or former employee's entitlement to post-employment benefits; and
WHEREAS the terms and conditions of post-employment benefit entitlement, if
any, are governed by contracts separate from and independent of the Program; and
WHEREAS the City's funding of the Program does not, and is not intended to,
create any new vested right to any benefit nor strengthen any existing vested right, and
WHEREAS the City reserves the right to make contributions, if any, to the
Program; and
WHEREAS, all constitutional and statutory prerequisites for the approval of this
resolution have been met, including but not limited to the Open Meetings Act; and
WHEREAS, the City Council deems the adoption of this resolution to be in the best
interests of the health, safety, and welfare of the public.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF GRAPEVINE, TEXAS
Section 1. That all matters stated hereinabove are found to be true and correct
and are incorporated herein by reference as if copied in their entirety.
Section 2. The Council hereby appoints the City Manager, or his/her successor
or his/her designee as the City's Plan Administrator for the Program.
Section 3. The City's Plan Administrator is hereby authorized to execute the
PARS legal and administrative documents on behalf of the City and to take whatever
additional actions are necessary to maintain the City's participation in the Program and
to maintain compliance of any relevant regulation issued or as may be issued; therefore,
authorizing him/her to take whatever additional actions are required to administer the
City's Program.
Section 4. The City Council hereby adopts the PARS Public Agencies Post-
Retirement Health Care Plan Trust, including the PARS Public Agencies Post-Retirement
Health Care Plan, effective November 1, 2016.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE,
TEXAS on this the 18th day of October, 2016.
APPROVED:
William D. Tate
Mayor
ATTEST:
Tara Brooks
City Secretary
APPROVED AS TO FORM:
John F. Boyle, Jr.
City Attorney
Resolution No. 2
ORDINANCE NO.
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS, APPROPRIATING $500,000.00
FROM THE TRUST AND AGENCY FUND
UNAPPROPRIATED FUND BALANCE; DECLARING AN
EMERGENCY AND PROVIDING AN EFFECTIVE DATE
WHEREAS, the City Council of the City of Grapevine desires to participate in the
PARS Public Agencies Post-Retirement Health Care Plan Trust (the "Program") to fund
post-employment benefits for its employees; and
WHEREAS, the City is eligible to participate in the Program, a tax-exempt trust
and plan performing an essential governmental function within the meaning of Section
115 of the Internal Revenue Code; and
WHEREAS, the City's adoption and operation of the Program has no effect on any
current or former employee's entitlement to post-employment benefits; and
WHEREAS, the City's funding of the Program does not, and is not intended to,
create any new vested right to any benefit nor strengthen any existing vested right; and
WHEREAS, the City desires to appropriate and transfer $500,000.00 to PARS for
the purpose of funding the Trust; and
WHEREAS, all constitutional and statutory prerequisites for the approval of this
ordinance have been met, including but not limited to the Open Meetings Act; and
WHEREAS, the City Council deems the adoption of this ordinance is in the best
interests of the health, safety, and welfare of the public.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF GRAPEVINE, TEXAS:
Section 1. That all matters stated herein above are true and correct and are
incorporated herein by reference, as if copied in their entirety.
Section 2. That the City Council hereby appropriates the funding.
Section 3. That the City Council hereby authorizes an amount of $500,000.00
to be appropriated; and
Section 4. That this ordinance shall take effect immediately upon passage by
the City Council of the City of Grapevine, Texas
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS on this the 18th day of October, 2016.
APPROVED
William D. Tate
Mayor
ATTEST:
Tara Brooks
City Secretary
APPROVED AS TO FORM:
John F. Boyle, Jr.
City Attorney
Ordinance No. 2