City Council

CITY OF POCATELLO, IDAHO CITY COUNCIL MEETING - BUDGET DEVELOPMENT APRIL 13, 2017 Mayor Brian Blad called the City Council meeting for budget development to order at 2:57 p.m. Council members present were Heidi Adamson, Roger Bray, Steve Brown, Gary Moore and Michael L. Orr. Council member Jim Johnston arrived at 3:13 p.m. HEALTH BENEFITS - Heather Buchanan, Human Resources Director, Nicole Harms, Human Resources Consultant, and Joyce Stroschein, Chief Financial Officer/Treasurer; gave an update on the City’s Health Benefits. It was announced that Mercer Health and Benefits, LLC was able to keep the Aetna health premium increase at 12%. The monthly costs and hourly value for Fiscal Year 2017 versus Fiscal Year 2018 were reviewed. It was noted that Fiscal Year 2018 figures do not include any Fire Department employee benefit costs. Health Benefit options for one (1) thru four (4) were presented. It was noted that calculations are from the salary projection file. Mr. Orr shared his concerns with the high increase in health insurance premiums. Ms. Harms explained that City retirees can stay on the City’s insurance until they turn age 65. She noted the retirees represent a very small population, but have a large impact on the cost. Ms. Harms explained Aetna is the City’s new health benefit carrier and does not have 12 months of information to base the premium. She mentioned that large claims were received during the few months of coverage. Ms. Stroschein noted the City has received double digit increases regarding health insurance for many years. She explained the continued increase for health benefits is a nationwide trend. In response to questions from Council, Ms. Harms explained that the City’s experience ratings were included in the formula to determine the premium amount. The employee’s costs for benefits were reviewed. Mr. Johnston arrived at this time. Council discussion regarding rising health care costs and medical costs distribution for employees followed. It was mentioned that the compensation plan for employees is also being discussed at this time. Mr. Orr feels the proposed compensation plan will make it easier to determine what an employee’s hourly rate is. He shared his thoughts regarding finding a balance between the health benefit increases and employee compensation. Ms. Buchanan shared her thoughts regarding the hybrid compensation plan costs and health benefit premiums. She mentioned that Council could put the proposed hybrid plan into place without the pay for performance option. Mr. Bray feels a new concept is needed to keep employees at a level of equity for the position they hold. He suggested a long-term plan should be considered.  2 CITY OF POCATELLO BUDGET DEVELOPMENT MEETING APRIL 13, 2017 Ms. Buchanan feels the City will have a better tool to attract new employees if the new plan is adopted. She noted that after 5 years of employment, market levels will even out. Council discussion regarding the medical plan cost distribution and compensation plan continued. It was mentioned that the City’s aging work force have limited increases to their wages because they have already met the maximum level. Debate regarding wages and premium amounts continued. Mr. Brown stated health insurance premiums will continue to rise. He noted that at some point the City cannot continue to supplement the insurance at the present rate. It was the consensus of the Council to choose Option 3 of the Medical Plan Cost Distribution. SEE ATTACHMENT “A” OUTLINING CITY OF POCATELLO BENEFITS FY2018 EMPLOYEE COMPENSATION - General discussion regarding the differences of merit pay and pay for performance continued. It was noted if Council decides to implement the compensation plan now and choose the pay for performance option, the pay for performance would be based a calendar year and not fiscal year in order to meet budgeting information needs. Mr. Orr mentioned if an employee feels underpaid, it is the manager’s responsibility to meet with Human Resources to reevaluate their job description. He noted that mangers and department heads will have a larger responsibility under the proposed plan. Ms. Buchanan suggested the current performance evaluations for employees be used as the new plan is being implemented. It was the consensus of the Council to choose Hybrid Plan No. 4 for the Compensation Plan. SEE ATTACHMENT “B” BUDGET DEVELOPMENT There being no further business, Mayor Blad adjourned the meeting at 4:08 p.m. APPROVED: BRIAN C. BLAD, MAYOR  3 CITY OF POCATELLO BUDGET DEVELOPMENT MEETING APRIL 13, 2017 PREPARED BY AND ATTEST: RUTH E. WHITWORTH, CMC, CITY CLERK