Sarasota News Leader

08/01/2014

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Major changes are coming in regard to the way the City of Sarasota manages its retiree healthcare. One proposal received tentative approval on July 24, when the city commis- sioners approved a staff recommendation to shift $3.9 million from a benefit plan to balance the proposed fiscal year 2014-2015 budget. The other change will take into consider- ation the impact of the Affordable Care Act on retirees, especially those not yet eligible for Medicare. The city covers a huge percent- age of the healthcare premiums for retirees, up to 84 percent for a family of three or more. The account used to make the budget-balanc- ing payment is called Other Post-Employment Benefits, or OPEB. The city is responsible for paying those fees into the future, creating what is called "an unfunded liability." Most cities in Florida use a pay-as-you-go plan to handle OPEB costs, but there was a concern in the mid-2000's that the expenses would balloon for medical, prescription and den- tal healthcare plans. A few cities — includ- ing Sarasota, in 2006 The City Commission is facing significant questions about the future funding of retired employees' benefits. Photo by Norman Schimmel A BUDGET-BALANCING ACT ANALYSIS: CITY PLANS RETIREE BENEFITS REVIEW We want to look at this as a one- time event and then look at recommendations for other solutions. Stacie Mason Human Resources Director City of Sarasota By Stan Zimmerman City Editor

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