2005 Performance Based Budget - Laserfiche WebLink

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The Self-Insurance Employee Benefit Fund continues to experience sizeable increases in health insurance claim expenditures. In the 2004 budget the City increased the "the employer" portion by 76% charged to each City department. This aggressive increase along with City wide education on wellness has allowed this fund to decrease its "employer" portion of each employee's cost for this health insurance by approximately 1$% in 2005 for all Teamsters and nan-bargaining employees. Similar changes to the health coverage plan have been negotiated with the Firefighters' and Police Union (affecting both active and retired members} these changes went into effect on 111101 far the Firefighters' and 1101102 for the Police. The City will continue to closely monitor this fund and will act when possible to curb anticipated increases in health care costs. The City's Liability Insurance Reserve Fund reflects an overall increase in expenditures of 2% from the prior year's budget. This increase is based upon current year trends, historical iax.formation (five year averages) and consideration of pending claims. The City is currently trying to settle several significant claims filed against the City over the past several years. These specific claims have nat been included in the 2005 Budget due to the uncertainty as to the amount and timing of any potential settlement. Any unusually high claim will need to be paid out of this fund's reserve cash balance which stood at $2,41$,449 as of December 31, 2004. The 2005 Budget includes four funds, Motor Vehicle Highway, Fire & Police Pension and Century Center, that is not "balanced" (revenues equal to or in excess of expenditures) for the year and thus this fund will need to rely on existing fund cash balances to support the projected 200 deficiency. Fire and Police Pension Funds • Although the budgets for the Police and Fire Pension Funds have been favorably impacted in comparison to prior years' budgets as a result of recent changes enacted by the new state pension law, these two funds will continue to be underfunded in the future years unless additional changes are made either by the State andlor through funding decisions within the City budget process. As the historical comparison report (included later in this section) shows, the fund balances for these two pensions have steadily decreased over the years as a result of pension payments outpacing revenues supporting these expenditures. It remains as one of the major funding issues far the future. The recent passage of a state bill that shifts pension payments for certain retirees from the city to the state (with fixture payments for these retirees to be made from acost-sharing, multiple employer pension system administered by the Indiana Public Employees' Retirement Fund} has helped; however, it has not eliminated future funding concerns. Priar to the passage of this bill, all City police officers and firefighters hired before May 1, 1977, participated in two single-employer defined benefit pension plans. Employees with twenty years of service could retire regardless of age and were entitled to full benefits. Benefits are based on actual years of service (twenty or more) and range from SO to 74% of the current salary of first-class patrolman or firefighter. These plans also provide far disability and death benefits. Covered employees are required by statute to contribute 6% of their salary. Indiana's state statute also requires annual employer contributions in an amount sufficient to fund projected benefits to be paid during that year B-10