CAO 03-07 RSA Retiree Health PlTO:
FROM:
SUBJECT:
CITY OF MIAMI BEACH
T. C. Adderly
Director &Human Resourc~
ebora J. Turner-'~)t~L~
First Assistant City Attorney
CAO//03-07
Interpretation of Related Special Acts in the City Code Relative
to Retiree Health Plan Benefits
DATE: June 4, 2003
You have submitted a request for assistance in reviewing certain benefit
issues that relate to retirees. Subsequently, such request has been refined to request
an interpretation of the City's Related Special Acts, as well as corresponding
language in Chapter 78 of the City Code, regarding persons covered under current
health insurance benefits. Specifically, you have requested the following:
Issue:
Whether the reference to "officers and employees" in
the Related Special Acts of the City and the term
"member" under Chapter 78 of the City Code are
consistent in that they both include persons who are
retired from the City as being entitled to the same
health benefits as active, full-time employees.
.Short Answer:
Yes. When read in pari materia, language in both the
Related Special Acts and in the City Code reflect that
members of the City's Employees' Benefit Plan
include former employees who are retired. In fact,
the Related Special Acts specifically cross-reference
the City Code and state that "provisions governing
health plan contribution, membership withdrawal/
reinstatement shall be established by ordinance. Such
"provisions" regarding membership in the City's
health plan are established in Chapter 78 of the City
Code via various ordinances.
Discussion:
Pursuant to Section 78-32 of the City Code, the "Miami Beach Employees'
Benefit Plan" is established "for the purpose of providing hospitalization, medical
and surgical benefits for regular employees of the city." Under Section 78-31 of the
City Code, a member of the Benefit Plan is defined as "any regular employee" of
the City participating in the plan." The definitions in Section 78-31 provide as
follows:
Regular employee means
(1) Any member of the city commission, officer,
department head, regular employees in the legal department
employed on a full-time basis, servant or agent of thc city regularly
receiving compensation from the city for personal services; except,
unless otherwise qualified, members of boards or commissions,
officers and employees who receive no salary or a nominal salary,
contractual employees or persons who are employed on a
provisional, original probationary or other temporary status under
civil service regulations. For the purpose of this article, persons
otherwise meeting this definition who are granted leaves of
absence under civil service procedures or by the city commission
and persons otherwise meeting this definition who are injured in
line of duty with the city and who are receiving compensation
under the workers' compensation law, shall be considered as
regular employees during such periods of absence from active duty
with the city until formally separated from service with the city;
and members who are retired for service or disability under any
city pension system and pensioners, subject to such conditions as
hereinafter specified, shall be considered employees? In all cases
in which the above definition requires interpretation, the board
shall decide who is a regular employee within the intent of this
article. (emphasis added).
(2) Any employee whose employment with the city is
terminated, voluntarily or involuntarily, and who, at the time of
such termination of employment, possesses a vested fight to future
pension benefits from any pension system of the city, shall not be
eligible for membership in the plan until such time as pension
benefits become payable to him, except as allowed by federal law.
Under the above provisions, a retiree with vested pension benefits may participate
in the City's health plan, but only when the retiree's pension benefits become
payable.
~ It appears that the word "regular" should precede the word "employee" in this
context. Thus, a text amendment to correct this scrivener's error is recommended.
CC:
In Section 78-33 of the City Code, the duration of membership in the
Benefit Plan is explained as follows:
(c) Membership in the plan, once established, may continue so
long as the member remains a regular employee. The board shall
prescribe conditions under which a member who is retired under
any pension system of the City and any pensioner may continue his
agreement and be entitled to benefits during the period of
retirement or pension; however, a pensioner's right to participate
in the plan shall terminate upon marriage or remarriage; and may
also provide means by which members who suffer service-
connected injuries and who receive benefits under the workers'
compensation law may discontinue agreements during such
periods. (emphasis added).
Thus, as long as a person remains "a regular employee," in either an active or
retired status, membership in the Benefit Plan may continue.
Turning to the City's Special Related Acts, Article V thereof addresses the
City's Health Plan as follows:
ARTICLE V. HEALTH PLAN FOR CITY OFFICERS AND
EMPLOYEES
SEC. 27. Authority to establish; cost; membership
The city commission of the City of Miami Beach, Florida, is
hereby empowered to establish by ordinance a health plan for
officers and employees of said city, which plan may include the
spouse and minor children of said officers and employees.
Provisions goveming health plan contribution, membership
withdrawal/reinstatement shall be established by ordinance.
(emphasis added).
When read in pari materia, the provisions in both the Related Special Acts and the
City Code establish that retirees were intended to be included under the City's plan
for health benefits. Indeed, the Related Special Acts defer the specifics of such plan
to the City Commission which is empowered to enact ordinances establishing
provisions as to plan contributions and membership.
Jorge Gonzalez, City Manager
Mayra Diaz Buttacavoli, Assistant City Manager
f:xatto\lurn~cao\retiree health benefits2.doc
TO:
FROM:
SUBJECT:
DATE:
CITY OF MIAMI BEACH
OFFICE OF THE CITY ATTORNEY
MEMORANDUM
Pat Hipple
Human Resources Administrator
Debora J. Turner ~
First Assistant City Attorney
Retiree Issues/Health Insurance
June 4, 2003
This is to follow up on your request for legal assistance regarding retiree issues as
they relate to health insurance costs. Attached is our response to your inquiry relative to
the interrelation between the Related Special Acts and the City Code with regard to the
inclusion of retirees as beneficiaries of health plan benefits.
You have also inquired as to what changes can be made to the City's health
insurance contributions for (a) current retirees and (b) for future retirees who are
currently active and vested, active and not vested, and future hires. Such inquiry
regarding various categories of retiree health benefits are matters of a high degree of
specialty and should be addressed to the outside counsel, and/or consultants, that gave
advice as to the 2001 amendments to the City's Related Special Acts concerning the
changes to the City's contributions to its health plan. The law firm of Lewis, Longman
& Walker, as well as Steve Cypen, Esq., may have been involved in this process. As a
result of such amendments, the City's contribution was changed from one half of the cost
of insurance benefits to a benefit to be established by ordinance. As we discussed, you
will make inquiry as to the advice and recommendations the Administration received
from the various outside specialists on this subject.
DJT/bfg
cc: Donald M. Papy, Chief Deputy City Attorney
f:~atlo\tumXmemos~retiree issues-pat hippie.doc