To: Martin L. Cousineau, Finance Committee Chairperson
From: Jennifer Draheim, Retirement Services Administrator
Chrystal Simpson, Chief Financial Officer
title
RE: Request for amendment of Section 18 of the Genesee County Employees’ Retirement System Ordinance
recommendation
BOARD ACTION REQUESTED:
Approval for amendment of Section 18 of the Genesee County Employees’ Retirement System Ordinance
BACKGROUND:
This memorandum is provided from this office to the Genesee County Board of Commissioners on behalf of the Retirement Commission of the Genesee County Employees’ Retirement System in light of the Retirement Commission’s discussions with its Actuary regarding the actuarial cost to the Retirement System of a member’s purchase of other governmental service credit.
DISCUSSION:
Section 18 of the Retirement Ordinance provides for the purchase of other governmental service credit. It is the Retirement Commission’s position that the current provisions of Section 18 do not adequately address the actuarial cost incurred by the Retirement System when a member purchases other governmental service credit. It is this office’s position that the Retirement Ordinance should be amended to accurately reflect the actuarial cost to the Retirement System when a member purchase other governmental service credit. Accordingly, attached please find a proposed Amendment to the Retirement Ordinance for your consideration that fully addresses the requested changes to Section 18 of the Retirement Ordinance.
IMPACT ON HUMAN RESOURCES:
N/A
IMPACT ON BUDGET:
N/A
IMPACT ON FACILITIES:
N/A
IMPACT ON TECHNOLOGY:
N/A
CONFORMITY TO COUNTY PRIORITIES:
Ensuring that the purchase of other governmental service credit accurately reflects the actuarial cost to the retirement system adheres to the Long-Term Financial Stability priority.
resolution
TO THE HONORABLE CHAIRPERSON AND MEMBERS OF THE GENESEE COUNTY BOARD OF COMMISSIONERS, GENESEE COUNTY, MICHIGAN
LADIES AND GENTLEMEN:
GENESEE COUNTY ORDINANCE AMENDMENT
TO AMEND THE
GENESEE COUNTY EMPLOYEES’ RETIREMENT SYSTEM ORDINANCE
BE IT ORDAINED, by this Board of Commissioners of Genesee County, Michigan, that the following Sections of the Genesee County Employees’ Retirement System Ordinance identified below are hereby amended to read in their entirety as stated below, with additions thereto being indicated, here only, by bold text, and deletions being indicated by strikethrough text.
Section 18.
Other Governmental Service Credit:
Upon the request of a Member of this Retirement System, who is a member of a collective bargaining unit which has bargained for and been granted this benefit by an Employer participant of this Retirement System, provided that if said bargaining unit is one that represents Genesee County Employees, said unit's collective bargaining agreement has been approved by a 3/5 affirmative vote of the Genesee County Board of Commissioners; or who is a Member of this Retirement System, is not a member of a District Library, such Member shall be credited with the amount of government service resulting from employment with the United States government, except military service, a state, or any of their political subdivisions, in addition to such credit for the Service with the County as to which the Member is otherwise entitled under this Ordinance, under the following conditions:
(a) Employment by the Employer participant occurred within fifteen (15) years following the Member's separation from service of the last unit of government by which the Member was employed, and the Member is currently actively employed with an Employer participant of this Retirement System. However, the fifteen (15) year condition is eliminated for a Genesee County Employee who is not a member of a County collective bargaining unit, including but not limited to an appointed official or officer, or a holder of elective office. However, effective April 29, 2008, the fifteen (15) years condition is eliminated for a Genesee Health System Employee who is not a member of a county collective bargaining unit. However, effective January 1, 2012, the fifteen (15) year condition is eliminated for a Water and Waste Employee who is not a member of a County collective bargaining unit.
(b) Service rendered before the last break in governmental service of more than fifteen (15) years shall not be credited. However, the fifteen (15) year condition is eliminated for a Genesee County Employee who is not a member of a County collective bargaining unit, including but not limited to an appointed official or officer, or a holder of elective office. However, effective April 29, 2008, the fifteen (15) year condition is eliminated for a Genesee Health Systems Employee who is not a member of a county collective bargaining unit.
(c) Service which is recognized for the purpose of a deferred retirement allowance under a retirement system or other employer-funded retirement benefit plan, except for a retirement benefit plan under the Social Security Act, 42, U.S.C. 301 to 1397f, of the United States government, a state, or a political subdivision of a state shall not be credited if the Member retired under a retirement system of the United States government, a state, or any of their political subdivisions or, if the Member has not yet so retired, until the Member irrevocably forfeits the right to the deferred retirement allowance; provided, however, that judges may receive credit for years for which, as judges, they simultaneously were Members of both a local government system, plan or program and the state retirement system, plan or program, and may receive such credit on the basis of the contributions which related to their local government membership, provided further that they have not retired under and have irrevocably forfeited their rights under said local system, plan, or program.
(d) The Member deposits in the Retirement System both (1) an amount equal to the aggregate amount of contributions the Member would have made had the service been acquired in the employ of the Employer participant of this Retirement System, including plus interest from the dates the contributions would have been made to the date the Retirement Commission approves the member’s application to purchase Other Governmental Service Credit at its next regular meeting of deposit, at rates determined by the Retirement Commission; and (2) an amount equal to the aggregate amount of Employer contributions the Employer participant of the Retirement System would have made had the service been acquired in the employ of the Employer participant of the Retirement System, at rates determined by the Retirement Commission. The rates determined by the Retirement Commission must be those rates in effect at the time of the Member’s purchase of Other Governmental Service Credit and shall ensure that the Retirement System’s Actuary calculates the full actuarial cost to purchase the member’s applicable Other Governmental Service Credit. If records are insufficient or unavailable to compute the exact amount of required deposit, the Retirement Commission may estimate the amount.
The Member has 8 or more years of Credited Service in employment with Employer participant, and deposits in the said Genesee County Employees' Retirement System the an amounts equal to the aggregate amounts of contributions required above the Employer participant would have made had the government service being credited under this section been acquired in the employ of the County. However, the requirement of this subsection of eight (8) or more years of Credited Service is reduced to five (5) or more years of Credited Service for a Genesee County Employee who is not a member of a County collective bargaining unit, including but not limited to an appointed official or officer, or a holder of elective office. Effective July 1, 2006, a non-union Employee of Water and Waste with three (3) years of Credited Service shall be eligible to purchase service credit pursuant to this section. The maximum purchase limitation for purchases of this subsection for Employees who are members of a collective bargaining unit is as stated in the Applicable Union Contract.
(e) Service credit will be determined by the full-time employment status as documented by the former governmental unit or by hours worked if prior employment was part-time. In no case shall more than one year of Service be credited any Member for all Service rendered by him in any calendar year.
Any Member may timely appeal any decision by the Genesee County Employees' Retirement Commission, regarding the Member's benefits under this Section, to the Genesee County Board of County Commissioners for a new hearing.
The Clerk of this Board is hereby directed to have a notice of this Ordinance Amendment promptly published in a newspaper of general circulation in Genesee County, Michigan.
Adopted: February 14, 2024
Signed:
James Avery, Chairperson
Genesee County Board of County Commissioners