HomeMy WebLinkAboutCity Council Committees - Fireman's Relief and Pension Board - 03/01/1994101 RON& I plema I NOM 111"1 11 1171111 !1!
March 1, 1994
Present: Boardmen,bers White, Johnson, Tilley and Jacober, City Attorney Lubovich, Finance
Division Manager Miller and Field Auditor Huntington.
Approval of Minutes
Tilley moved to approve the minutes of the meeting of February 15, 1994. Johnson seconded
and the motion carried.
Line of Duty Disability Benefits
Huntington distributed copies of a memo regarding year end information returns (1099) and
taxability of payments during the first six months of disability. Tilley explained that he is
referring to on-going payments that are benefits above what the state pays and what RCW
41.26.120 says is to be paid. He noted that the state does not issue a 1099, or a W-2, but the
City of Kent continues to issue 1099's.
Huntington noted that the State determines whether disabilities are duty or non -duty related.
Tilley stated that that is a local Board decision. Huntington explained that the City is not aware
whether disabilities are duty or non -duty related, therefore taxable or non-taxable. Tilley noted
that the LEOFF 1 Board has on record every retiree and the type of retirement. He said that
in -line -of -duty disabilities are non-taxable. He said that if the Board secretary contacted other
cities, the results would show that Kent is the only city that does it that way. White questioned
why this issue has been brought to this board. Miller suggested researching the issue and noted
that there is no line of communication between the LEOFF Board and the payroll department.
It was agreed that the benefits are being paid properly, and the issue is how the City reports the
benefit to the Federal government. Tilley noted that the City Human Resources Department has
a record of all retirees which is received from the State. Miller stated that she will follow
through on this issue, report back and make whatever corrections are necessary. Tilley clarified
that surviving spouses would not get 1099s. White asked for a written policy.
Approval of Financial Transactions
Miller distributed copies of a report showing the 1994 budget and the January transactions. She
noted for Tilley that only enough money to pay the bills is kept in the cash fund, and that
$17,000 is available in the budget for an actuarial study. She added that she will report on the
status of the actuarial study at the next meeting. She noted that interest income totalled $7,856.
Upon Tilley's question regarding Orndorff's overpayment, Miller explained that his pension is
being applied to the outstanding amount due. She said that research by the City Attorney's
Office indicated that since he is receiving his full amount for the State, that the entire amount
from the City can be applied to the amount due. Tilley indicated that it is his belief that only
50 % can be deducted from Orndorff's payments. Lubovich agreed to research the matter further
and report back at the next meeting.
Tilley then moved to accept the financial report as written. Johnson seconded and the motion
carried.
Retroactive Pay
Lubovich distributed copies of a memo regarding underpayment of pension benefits and statute
of limitations, and said that after researching the statutes, the case law and the Kelso petition,
he feels the three year statute of limitations would apply. He explained that if there is a written
contract, the statute of limitations is six years, if there is no written contract the statute of
limitations is three years, and if Section 41.50.130 is tied to it, there is no statute of limitations.
He added that Municipal Research has acknowledged that there is no clear answer, since there
is no case law, but they felt the statute of limitations would be three years. Tilley noted that
firefighters trust that the city runs their pension system appropriately and legally, following
guidelines. He added that there is no statute of limitations in a trust relationship. Lubovich
noted that that was rejected in the Martin case and a three year statute of limitations was applied.
He said he is willing to look at other documentation and Tilley asked for time to do further
research.
Lubovich noted that the Kelso matter has no precedent -setting value because it was a settlement,
and the value was equivalent to a six-year settlement.
It was agreed to continue this item to the next meeting.
Other Business
There was no other business and the meeting adjourned at 5:30 p.m.
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Brenda Jacbber; CMC
City Clerk