2007-04-04-ATM-AC-rpt1 - Laserfiche WebLink

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APPROPRIATION COMMITTEE 1st REPORT, APRIL 4, 2007, TO 2007 ATM future years, depending upon the number of unmarried dependent children of employees who have retired early because of accidental disability. Section 9(2)(d)(ii) Section 9(2)(d)(ii) can be accepted only if Town Meeting has accepted section 7(2)(a)(iii). It extends the same benefits payable under section 7(2)(a)(iii), in both amount and frequency of payment, to dependent children of employees who have died because of an injury sustained while working for the Town. The payments are made to each dependent child's natural or legal guardian so long as the child remains dependent (definition as cited above for Section 7(2)(a)(iii) applies). As is the case with Section 7(2)(a)(iii), once Town Meeting accepts this statute, that acceptance cannot be revoked. Under Section 9(2)(d)(ii), benefits are only payable from the date that Town Meeting accepts the statute; they are not payable retroactively. The annual amount payable under this statute is identical to the annual amount payable under Section7(2)(a)(iii). That amount will increase, on an annual basis, by the annual percentage COLA adopted by the Massachusetts Legislature. So far as can be determined, there are currently no dependent children qualified for payments under this statute. If Town Meeting accepts either or both of these statutes, all payments will be made from the Town's Retirement Trust Fund, which is administered by the Retirement Board. Last year the Fund made mandated payments approximating $8,000,000 to retired employees and currently has more then $100,000,000 in assets. As required by law, the Town pays annual assessments into the Fund. Under that law, the Fund must be fully funded by 2028; however, based on the annual payments being made by the Town, the Fund is projected to be fully funded by 2015. Accepting either or both of these statutes will minimally affect the Town's annual assessment. A majority of this Committee (6-3) supports acceptance of both sections. The minority expressed concern that supplemental post-retirement employment benefits such as these, however small in amount or seemingly worthy, should-as a matter of principle-not be granted unilaterally, but should be negotiated as part of the collective bargaining process. The minority also expressed concern that pension add-ons, such as the ones at issue here, require particularly careful scrutiny because they have the potential to create greater liabilities for the Town in the future than maybe apparent today, and can also trigger long- termpension obligations disproportionate to the period of service a Town employee has rendered. Article 18• Accept Funds Requested Funding Committee MGL Chapter 32B Source Recommendation , Section 18 None Approve (9-0) (Medicare Extension Plans) Chapter 32B of the Massachusetts General Laws authorizes governmental entities accepting various of its provisions to provide and implement different plans of insurance for employees and their dependents. The plans can encompass retirees and their dependents. Lexington has accepted a number of provisions of Chapter 32B and provides medical and other health insurance plans to its employees and retirees. Among the plans Lexington has obtained and provides is, in the statutory language, "optional medicare extension" coverage to its retirees who are eligible for coverage under Medicare, the Federal Health Insurance for the Aged Act. The plan is also known as a Medicare health-benefits supplement plan. Currently, participation by retirees in Lexington's Medicare extension plan is optional. Acceptance of Section 18 will require retirees who are eligible for Medicare coverage to transfer to the extension plan Page 10 of 39