Ann Arbor logo
Share to Facebook Share to Twitter Bookmark and Share
File #: 11-1061    Version: 1 Name: 9/06/11 Chapter 18 Vesting Period Amendments
Type: Ordinance Status: Passed
File created: 9/6/2011 In control: City Council
On agenda: 9/19/2011 Final action: 9/19/2011
Enactment date: 9/6/2011 Enactment #: ORD-11-17
Title: An Ordinance to Amend Sections 1:552.1, 1:561, 1:562, 1:565, 1:567, 1:158 and 1:592 of Chapter 18, Employees Retirement System, Title I of the Code of the City of Ann Arbor to Increase the Vesting Period and Final Average Compensation Period for Non-Union Employees Hired on or After July 1, 2011 (Ordinance No. ORD-11-17)
Attachments: 1. 11-17 Briefed & Approved, 2. Chpt 18 Vesting Amendments Ord.pdf, 3. ORD-11-17 Briefed
Title
An Ordinance to Amend Sections 1:552.1, 1:561, 1:562, 1:565, 1:567, 1:158 and 1:592 of Chapter 18, Employees Retirement System, Title I of the Code of the City of Ann Arbor to Increase the Vesting Period and Final Average Compensation Period for Non-Union Employees Hired on or After July 1, 2011 (Ordinance No. ORD-11-17)
Memorandum
On June 6, 2011, City Council directed the City Administrator and the City Attorney to present City Council with an ordinance amendment increasing the pension vesting period from the current 5 years to 10 years for non union employees hired after July 1, 2011 (R-11-219). As part of the underlying documentation necessary to prepare and present this amendment to Council a Supplemental Actuarial Valuation on the effect of the proposed benefit change was performed. The necessary amendment to Chapter 18 of the City Code is attached.

If this ordinance change is approved, the retirement benefits for new hires will reflect the new plan provisions for vesting and FAC calculations. The city’s pension costs will be reduced as existing employees are replaced with new hires. At some date in the future when all of the non-union employees are under the revised plan provisions, the actuary estimates the city’s costs would be approx. $230,000 less per year going forward.
Staff
Prepared by: Mary Joan Fales and Nancy Niemela, Senior Assistant City Attorneys
Reviewed by: Stephen K. Postema, City Attorney
Approved by: Tom Crawford, Interim City Administrator
Body
ORDINANCE NO. ORD-11-17

First Reading: September 6, 2011 Published: September 22, 2011

Public Hearing: September 19, 2011 Effective: October 2, 2011

EMPLOYEES RETIREMENT SYSTEM
(IMPLEMENT AN INCREASE IN THE VESTING PERIOD AND
THE FINAL AVERAGE COMPENSATION PERIOD FOR
NON-UNION EMPLOYEES HIRED ON OR AFTER JULY 1, 2011)

An Ordinance to Amend Sections 1:552.1, Section 1:561, Section 1:562, Section 1:565, Section 1:567, Section 1:568, and Section 1:592 of Chapter 18,...

Click here for full text