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Home My WebLink About02/04/2003, C6 - ADDENDUM TO THE MEMORANDUM OF AGREEMENT BETWEEN THE CITY AND THE SAN LUIS OBISPO FIRE BATTALION CHI j agenda RepoRt CITY OF SAN LUIS OBISPO FROM: Karen Jenny, Acting Director of Human Resources SUBJECT: ADDENDUM TO THE MEMORANDUM OF AGREEMENT BETWEEN THE CITY AND THE SAN LUIS OBISPO FIRE BATTALION CHIEFS' ASSOCIATION CAO RECOMMENDATION Adopt a resolution approving an Addendum to the Memorandum of Agreement between the City and the San Luis Obispo Fire Battalion Chiefs'Association. DISCUSSION The 2002-04 Memorandum of Agreement (MOA) between the City of San Luis Obispo and the San Luis Obispo Fire Battalion Chiefs' Association (BC's) included a re-opener to discuss changes to the City's contribution to the cafeteria plan when negotiations with the Fire Union regarding the City's 2003 contribution had been concluded. Negotiations with the Fire Union concluded on this issue in December, and staff met with the BC's in January. The tentative agreement reached with the BC's is the same as the tentative agreement with the Fire Union. Effective in December 2002, for the January 2003 premium,the City's contribution to the cafeteria plan will increase from$490 per month to$675 per month. In December 2003 and December 2004, the City's contribution will increase by one-half of the average increase for health insurance plans available in San Luis Obispo County. In addition to providing consistency in the cafeteria benefit between the Fire Union and the BC's, this tentative agreement also sets an important precedent of cost sharing between the City and employees for the increases to health insurance costs. Current estimates.are that medical insurance premiums are likely to increase in the 15-20% range each year for the next several years. Without this kind of cost-sharing agreement, staff anticipates that employee groups will expect the City to bear the increase cost of health insurance premiums through an equivalent bump in the City's contribution to the cafeteria plan. FISCAL IMPACT The cost of the increase to the cafeteria plan contribution for the remainder of the 2002-03 fiscal year is $3,900, and $6,700 on an ongoing annual basis. Because of the cost-sharing agreement, the cost increase in the following years is anticipated to be in the $1,800 to $2,400 range. Funding required to support the costs FY 2002-2003 is available in the existing fund balance. The second year costs will be included in the two-year financial plan for 2003-05. Cly- 1 Council Agenda Report—San Luis Obispo Fire Battalion Chiefs'Association Page 2 Addendum to the Memorandum of Agreement ALTERNATIVES Because the addendum complies with previous Council direction, is similar to contracts recently approved for other units (including the Fire Union), and demonstrates the City's and BC's willingness and ability to craft a mutually satisfactory agreement in a timely and collaborative manner, no alternatives are presented for Council consideration. ATTACHMENTS Resolution G:VWgenda Reports\Addendum To BC MOA For Cafeteria Contribution.Doc ATTACHMENT 1 RESOLUTION NO. (2003 Series) A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO ADOPTING AND RATIFYING AN AMENDMENT TO THE MEMORANDUM OF AGREEMENT BETWEEN THE CITY OF SAN LUIS OBISPO AND THE SAN LUIS OBISPO FIRE BATTALION CHIEFS'ASSOCIATION FOR THE PERIOD OF JULY 1;2002—JUNE 309 2004 BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. The Addendum to the Memorandum of Agreement between the City of San Luis Obispo and the San Luis Obispo Fire Battalion Chiefs' Association, attached hereto as Exhibit"1" and incorporated herein by this reference, is hereby adopted and ratified. SECTION 2. The Finance Director shall adjust the Personnel Services appropriation accounts to reflect the negotiated compensation changes. SECTION 3. The City Clerk shall furnish a copy of this resolution and a copy of the executed Addendum approved by it to: Warren Stephenson, San Luis Obispo Fire Battalion Chief Officers' Association President and Karen Jenny, Acting Director of Human Resources. Upon motion of , seconded by , and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted this 4th day of February, 2003. Mayor David F. Romero ATTEST: Lee Price, City Clerk CU -5 ' 1 Resolution No. (2003 Series) Page 2 APPROVED AS TO FORM: x .014, ;� filbert A. Truji , Acting City Attorney Exhibit "1" ADDENDUM TO THE 2002-04 MEMORANDUM OF AGREEMENT BETWEEN THE CITY OF SAN LUIS OBISPO AND THE SAN LUIS OBISPO FIRE BATTALION CHIEFS' ASSOCIATION I. PURPOSE OF THIS ADDENDUM Article 12 of the 2002-04 Memorandum of Agreement (MOA) allowed negotiations to be re- opened regarding the City's contribution to the cafeteria plan for 2003. This addendum confirms the agreement of the parties to modify the MOA. Except as modified below, all other terms and conditions shall remain in full force and effect. 11. MODIFICATION OF CONTRIBUTION TO CAFETERIA PLAN Article 12, Health Care Insurance, Section A and Section B, paragraphs 1 and 2, are modified as follows: A. CONTRIBUTION Effective in December 2002, for the January 2003 premium, the City agrees to contribute$675.00 per month for medical, dental, vision and life insurance for each regular, full-time employee covered by this Agreement. The City's total Cafeteria Plan contribution will be modified in December 2003 and December 2004 by an amount equal to one-half of the average percentage change in PERS health plans available in San Luis Obispo County. For example: if three plans were available and the year to year changes were +10% +15% +20% respectively, the City's contribution would be increased by 7.5% (10% + 15% + 20% -3 = 15% x 1/2). B. INSURANCE COVERAGE 1. PERS Health Benefit Pram The City has elected to participate in the PERS Health Benefit Program with the "unequal contribution option" at the PERS minimum contribution rates. The City's contribution toward retirees shall be increased by five (5%) percent per year of the City's contribution for the active employees until such time as the contributions for employees and retirees are equal. The City's contribution will come out of that amount the City currently contributes to 1 Adclendum to 2002-2004 Memorandum of Agreement Paget San Luis Obispo Fire Battalion Chiefs' Association employees as part of the Cafeteria Plan. The cost of the City's participation in PERS will not require the City to expend additional funds toward health insurance beyond what is already provided for above in Section A. In summary, this cost and any increases will be borne by the employees. 2. Health Insurance Coverage Optional Participation Employees with proof of medical insurance elsewhere are not required to participate in the PERS Health Benefit Program and may receive the unused portion of the City's contribution (after dental and vision is deducted) in cash in accordance with the City's Cafeteria Plan. Those employees will not receive the City's minimum PERS Health benefit contribution. CITY OF SAN LUIS OBISPO SAN LUIS OBISPO FIRE BATTALION CHIEFS'ASSOCIATION Karen Jen , RisjYmanager Warren Ste enson Fire Battalion Chief e Wendy teorge, Assistant CAO Tom Zeulner Fire Battalion Chief Bob Rutledge Fire Battalion Chief i" G:\MOAs\Fire Battalion ChiefstAddendum to 2002-04 BC MOA.doc