2009-26998 ResoRESOLUTION NO. 2009-26998
A RESOLUTION RATIFYING A MEMORANDUM OF
UNDERSTANDING BETWEEN THE CITY OF MIAMI BEACH AND
THE GOVERNMENT SUPERVISORS OF AMERICA, LOCAL 100
(GSA) TO ADD A DEFERRED RETIREMENT OPTION PLAN (DROP)
TO THE MIAMI BEACH EMPLOYEES' RETIREMENT PLAN
(MBERP).
WHEREAS, discussions were held regarding a proposed ordinance that would add a
Deferred Retirement Option Plan (DROP) to the Miami Beach Employees' Retirement Plan at
both the September 16, 2008 and May 29, 2008 Finance & Citywide Projects Committee
meetings; and
WHEREAS, Ordinance No. 2006-3504 was adopted on March 8, 2006, which merged
the former retirement system for general employees of the City with the former retirement
system for unclassified employees of the City and created the Miami Beach Employees'
Retirement Plan, which is the City's current pension plan; and
WHEREAS, the City Administration, through the City Manager, and the Government
Supervisors of America, Local 100 (GSA), through its President, have entered into a
Memorandum of Understanding (MOU) to implement a DROP, subject to enactment by the
Mayor and City Commission of an amendment to Ordinance No. 2006-3504; and
WHEREAS, the Mayor and City Commission approved the amendment to Ordinance
No. 2006-3504 on first reading on December 10, 2008; and
WHEREAS, the GSA held a ratification vote of its members on the MOU on January 14,
2009; and
WHEREAS, of the 20 members who participated, 100% voted in favor of ratification of
the MOU; and
WHEREAS, the proposed amendment to the ordinance has been set for second
reading, public hearing at this January 28, 2009 City Commission meeting.
,~009- d6 y9~'
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND THE CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA that the attached Memorandum of
Understanding between the City of Miami Beach and the Government Supervisors of America,
Local 100 is hereby ratified.
Adopted this Z8th day of January 2009
tti Herrera Bower
Mayor
Attest:
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Robert Parcher
City Clerk
APPROVED AS TO
FORM & LANGUAGE
& FOR EXECUTION
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City Attorne p- a- ~""'''
T:~AGENDA~2009~.lanuary 28\Regular\GSA DROP RATIFICATION RESO - revised.doc
COMMISSION ITEM SUMMARY
Condensed Title:
A Resolution Ratifying A Memorandum of Understanding Between the City of Miami Beach And
The Government Supervisors Of America, Local 100 (GSA) To Add A Deferred Retirement
Option Plan (DROP) To The Miami Beach Employees' Retirement Plan (MBERP)
intenaea c~utcome su
Attract and Maintain a Quali Workforce.
Supporting Data (Surveys, Environmental Scan, etc.):
2000-2008 Environmental Scan: (1) Retention and turnover rates for City employees were
11.20% in 2004 versus 13.86% in 2007; and (2) Average employee tenure for City employees
was 9.48 ears in 2004 and 8.95 ears in 2007.
Issue:
Shall the Mayor and City Commission ratify a Memorandum of Understanding Between the City
the GSA Union to add a Deferred Retirement Option Plan (DROP) to the Miami Beach
Employees' Retirement Plan (MBERP)?
item summa iKecommenaation:
The issue of amending the current Miami Beach Employees' Retirement Plan ordinance to add a
Deferred Retirement Option Plan (DROP) was discussed on First Reading at the December 10, 2008
City Commission Meeting. The proposed ordinance has been set for second reading, public hearing
at this January 28, 2009 City Commission meeting. The City Administration, through the City
Manager, and the Government Supervisors Of America, Local 100 (GSA), through its President,
have entered into a Memorandum of Understanding (MOU) to implement a DROP, subject to
enactment by the Mayor and City Commission of an amendment to Ordinance No. 2006-3504. This
' type of change requires the Collective Bargaining Unit to hold a ratification vote among their
members. With the anticipation of the proposed ordinance passing, on January 14, 2009, the GSA
held a ratification vote amongst its members. A total of finrenty (20) members participated in the
ratification vote. Of the twenty (20) members voting, 100% voted in favor of adding the DROP. The
Administration recommends that the Mayor and City Commission hereby ratify the Memorandum of
Understanding between the City of Miami Beach and the Government Supervisors Of America, Local
100 (GSA) to add a Deferred Retirement Option Plan to the Miami Beach Employees' Retirement
Plan (MBERP).
Advisory Board Recommendation:
Financial Information:
-.
Source of Amount ' Account Approved '"
Funds: ~:
2„
3,,
4>
OBPI Tota! ' '
Financial Impact Summary: It is difficult to estimate the actual savings and/or costs to adding a
DROP since it depends on the actual number of eligible employees who enter the DROP. According
to the analysis conducted by the City's Actuary, the first year savings to the City could be as much as
$985,227 if 100% of the eligible employees enter the DROP to an actual cost to the City of $32,352 if
none of the eligible employees enter the DROP.
City Clerk's Office Legislative Tracking:
~ Ramiro Inguanzo, Human Resources Director
~ Qepartment Director' ,~: Asslstant City Manager ,~it~r, Manager
T:~AGENDA12009Wanuary 281Regular~GSA DROP Ratification Vote Summary - revised.doc
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~' MIAMIBEACH
City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachfl.gov
COMMISSION MEMORANDUM
To: Mayor Matti Herrera Bower and Members of the City Commission
FROM: Jorge M. Gonzalez, City Manager
DATE: January 28, 2009
SUBIECT: A RESOLUTION RATIFYING A MEMORANDUM OF UNDERSTANDING
BETWEEN THE CITY OF MIAMI BEACH AND THE GOVERNMENT
SUPERVISORS OF AMERICA, LOCAL 100 (GSA) TO ADD A DEFERRED
RETIREMENT OPTION PLAN (DROP) TO THE MIAMI BEACH
EMPLOYEES' RETIREMENT PLAN (MBERP).
ADMINISTRATION RECOMMENDATION
Adopt the proposed resolution.
BACKGROUND
The issue of amending the current Miami Beach Employees' Retirement Plan ordinance to add a
Deferred Retirement Option Plan was presented at the December 10, 2008 City Commission
meeting. The existing ordinance, Ordinance No. 2006-3504, was last amended on March 8, 2006.
The ordinance merged the former retirement system for general employees of the City with the
former retirement system for unclassified employees of the City and created the Miami Beach
Employees' Retirement Plan (MBERP), which is the City's current pension plan. The proposed
amendment to Ordinance No. 2006-3504 would implement a Deferred Retirement Option Plan
(DROP) for members of the Miami Beach Employees' Retirement Plan and would create new
sections of the ordinance which defines, establishes, and sets forth the features of the DROP.
The Mayor and City Commission approved the amendment to Ordinance No. 2006-3504 on first
reading on December 10, 2008. The proposed amendment to the ordinance has been set for
second reading, public hearing at this January 28, 2009 City Commission meeting. Should the City
Commission pass the proposed ordinance, the DROP will take effect ten (10) days following.
The City Administration, through the City Manager, and the Government Supervisors of America,
Local 100 (GSA), through its President, have entered into a Memorandum of Understanding (MOU)
to implement a DROP, subject to enactment by the Mayor and City Commission of an amendment to
Ordinance No. 2006-3504. This type of change requires the Collective Bargaining Unit to hold a
ratification vote among their members. With the anticipation of the proposed ordinance passing, on
January 14, 2009, the GSA held a ratification vote amongst its members. A total of twenty (20)
members participated in the ratification vote. Of the twenty (20) members voting, 100% voted in
favor of adding the DROP.
GSA DROP Ratification Vote
January 28, 2009 City Commission Meeting
Page 2 of 2
CONCLUSION
The Administration recommends that the Mayor and City Commission hereby ratify the
Memorandum of Understanding between the City of Miami Beach and the Government Supervisors
of America, Local 100 (GSA) to add a Deferred Retirement Option Plan to the Miami Beach
Employees' Retirement Plan (MBERP).
JMG/ri
T:WGENDA~2009Uanuary 28\Regular~GSA Dk20P Ratification Vote Memo 1-18-09 - revised.doc
MEMORANDUM OF UNDERSTANDING
This Memorandum of Understanding (MOU) is entered into this ~ day of December,
2008, between the City of Miami Beach (City) and the Government Supervisors
Association of Florida, OPEIU, Local 100 (GSA) to add a Deferred Retirement Option
Plan for all employees in GSA.
In accordance with the applicable provisions of the Miami Beach Employee's Retirement
Plan, members must satisfy certain criteria prior to entering into the Deferred Retirement
Option Plan (DROP). In order to be eligible to participate in the DROP, the employee
must attain their normal retirement age, as defined in Section 5.01, which also requires
the completion of five (5) or more years of creditable service. In addition, all parties
hereby agree that members who elect to participate in the DROP shall not be eligible for
any post-retirement improvement factor, as provided for in Section 5.10 (b), throughout
the duration of their DROP participation period.
The implementation of this Deferred Retirement Option Plan is completely contingent on
the Miami Beach City Commission amending the Miami Beach Employees' Retirement
Plan (created by ordinance 2006-3504) to include the DROP provision. If the City
Commission does not amend the ordinance, this MOU is null and void.
It is proposed that the Miami Beach Employees' Retirement Plan be amended as follows
to include the DROP:
Section 1. A new Section 2.26 of the Miami Beach Employees' Retirement
Plan created by Ordinance 2006-3504, as subsequently amended, is created to read:
2.26 Deferred Retirement Option Plan (DROP) - A program under which a Member
who has reached the normal retirement date mav elect to retire for purposes of the Plan
but continue emplovment with the Citv for up to thirtv-six (36) months and have his/her
monthlv retirement benefit paid into a DROP account durinq the DROP period in
accordance with Section 5.13.
Section 2. A new Section 5.13 of the Miami Beach Employees' Retirement
Plan created by Ordinance 2006-3504, as subsequently amended, is created to read:
5.13 A deferred retirement option plan ("DROP") is herebv established for eliqible
Members, as follows:
(a) Eliqibilitv and participation:
1. A Member who attains the normal retirement date shall be eliqible to
participate in the DROP.
2. A Member's election to participate in the DROP shall be irrevocable
A Member mav participate in the DROP onlv once
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3. An eligible Member mav participate in the DROP for a maximum of
thirtv-six (36) months.
4. An eliqible Member who elects to participate in the DROP must
provide at least thirtv (30) days' advance written notice to the Citv of
his or her election to participate in the DROP. A Member who elects to
participate in the DROP mav elect to terminate DROP participation
and Citv employment sooner than the maximum DROP period, with
thirtv (30) davs' advance written notice to the Citv.
(b) DROP plan features:
1, An eliqible Member who elects to participate in the DROP will be
considered to have retired for purposes of the Plan uqon entrv into the
DROP, except that such Member shall be eliqible to vote for and
serve as an Emplovee member of the Board of Trustees during the
DROP participation period. The Member's monthlv retirement benefit
determined in accordance with the Plan based on vears of creditable
service and final average monthlv earninqs at the time the Member
enters the DROP, will be paid into the Member's DROP account everv
month during the DROP qeriod.
2. No Member contributions shall be required after a Member enters the
DROP, and the Member will not accrue anv additional creditable
service or anv additional benefits under the Plan after enterinq the
DROP. No Citv normal cost contributions shall be repuired after a
Member enters the DROP, and DROP participants shall be excluded
from the covered pavroll for the Plan.
3. A Member who elects to participate in the DROP shall not be eliqible
for disabilitv or preretirement death benefits under the Plan~ nor shall
a Member be eliqible for anv post retirement adiustment provided in
Section 5.10 during the DROP participation period
4. A Member who elects to participate in the DROP shall retain the
earned balance of annual and sick leave as of the date of entrv into
the DROP, and shall continue to earn annual and sick leave durinq
the DROP period, in accordance with applicable Citv ordinances
Alternativelv, at the time of entry into the DROP a
Member mav repuest full or partial pavment of the earned balance of
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annual and sick leave as of the date of entrv into the DROP, up to the
maximum allowed bv applicable Citv ordinances for employees who
terminate Citv emplovment, but reduced bv the amount of annual and
sick leave used for the purchase of additional credited service under
section 4.03, if anv, at the Member's rate of compensation upon
enterinq the DROP; provided that the Member must retain at least 120
hours of accrued sick leave after anv such pavment. Upon
termination of Citv emplovment, a Member who has participated in the
DROP shall be eligible to receive payment for the earned balance of
annual and sick leave as of the date of termination, up to the
maximum allowed bv applicable Citv ordinances for emplovees who
terminate Citv emqlovment, but reduced bv the amount of annual and
sick leave for which pavment was received upon entry into the DROP,
if anv; and further reduced bv the amount of annual and sick leave
used for the purchase of additional credited service under section
4.03, if anv. In no event shall pavments for accrued annual or sick
leave be included in a member's Earninqs for purposes of the Plan.
5. As a condition of participatinq in the DROP, the Member must agree
to terminate Citv emplovment at the conclusion of the DROP period
and to submit an irrevocable letter of resignation statinq this prior to
enterina the DROP. A Member who elects to participate in the DROP
must also submit an irrevocable written DROP election prior to
enterinq the DROP on a form provided bv the Board.
6. At the conclusion of the DROP period and upon termination of Citv
emplovment, the Member's monthlv retirement benefit shall be paid to
the Member in accordance with the Plan. In the event of the
Member's death during or at the conclusion of the DROP period a
benefit mav be pavable in accordance with Section 5 07
8. Participation in the DROP is not a guarantee of Citv employment and
DROP participants will be subiect to the same terms and conditions of
emplovment that are applicable to employees who are not DROP
participants.
9. Durinq participation in the DROP the Member's monthlv retirement
benefit will be paid into the DROP account and shall be
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credited/debited with earninqs/losses as provided herein. The
Member mav direct that their DROP account be invested in anv of the
investment options approved bY the Board, on forms provided bv the
Board. Anv aains on the Member's DROP account investments shall
be credited to the Member's DROP account; and anv losses incurred
by the Member shall be deducted from the Member's DROP account
balance, and shall not be made up bv the Citv or the Retirement Plan.
A Member's DROP account shall onlv be credited or debited with
ear_ninqs/losses while the Member is a participant in the DROP.
10. A DROP participant mav desiqnate a beneficiarv or beneficiaries for
his/her DROP account on a form provided bv the Board.
11. Within thirtv (30) davs followinq a DROP participant's termination of
City emplovment or death, whichever occurs first, the Member or in
the event of the Member's death the Member's desiqnated
beneficiarv, mav submit a written election on a form approved bv the
Board, to receive the Member's entire DROP account balance which
shall be distributed to the Member (or in the event of the Member's
death, to the Member's designated beneficiarv or estate in
accordance with paraqraph (b)9., below) in a cash lump sum unless
the Member elects to have all or anv portion of an eliqible rollover
distribution paid directlv to an IRA or eligible retirement plan specified
by the Member in a direct rollover. Anv such direct rollover shall be
processed in accordance with Article 12 of the Plan. In the event a
Member or desiqnated beneficiarv does not submit a written election
to receive a distribution of the Member's DROP account balance
within thirtv (30) davs followinq the Member's termination of Citv
emqlovment or death, the Member's DROP account shall be
maintained bv the Plan but shall not be credited with earnings/losses
after thirtv (30) davs following the Member's termination of Citv
emplovment or death.
12.If a DROP participant dies before his or her DROP account is
distributed, the participant's desiqnated beneficiarv shall have the
same riqhts as the participant with respect to the distribution of the
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DROP account. If the participant has not designated a beneficiary, the
DROP account balance shall be qaid to the Member's estate.
13.The Board of Trustees shall make such administrative rules as are
necessarv for the efficient operation of DROP, but shatl not adopt anv
rule that is inconsistent with this Ordinance or the Plan.
14.The DROP shall be administered so that the Plan remains qualified
under the Internal Revenue Service Code and in compliance with
applicable laws and requlations.
Section 3. Conflicts and Severability.
(a) All Ordinances, and parts of ordinances, in conflict herewith shall be and
the same, are hereby repealed.
(b) In the event any article, section, paragraph, sentence, clause, or phrase
of this Ordinance shall be adjudicated invalid or unconstitutional, such adjudication shall
in no manner affect the other articles, sections, paragraphs, sentences, clauses or
phrases of this Ordinance, which shafl be and remain in full force and effect as fully as if
the item so adjudged invalid or unconstitutional was not originally a part hereof.
Section 4. Effective Date. This Ordinance shall take effect the day of ,
2009.
EXECUTED by the parties hereto on the date written below:
BY• ~
John Gresh
Director, G AF Miami Beach
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Date
BY: ~
J rge . onza
ity ger
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Date
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