On October 20, 2020, Mayor and Commission approved and adopted Ordinance 2020-09, which amended section 6.04 of the North Miami Beach Code of Ordinances, entitled “benefits other than on retirement.” As approved, participants who were previously employed in the City’s Water Utility and retired after attaining the normal retirement date were eligible to return to City employment in a full-time position in the Water Utility without loss of retirement income. Further, on October 19, 2021, Mayor and Commission approved and ratified the 2020-2023 Collective Bargaining Agreement between the City of North Miami Beach and the American Federation of State County and Municipal Employees, Local 3293, bargaining unit. This agreement included a benefit for City Water Utility, Wastewater Utility, or Customer Service Division retirees that were rehired by the City between October 20, 2020 and October 20, 2021, the eligibility to participate in a defined contribution plan (401a plan).   In order to comply with the newly ratified agreement the City must create a new plan for non-management rehired retirees. The newly created plan shall be retroactively applied to the date of ratification of CBA, shall require an employee contribution in the amount of 5% and an employer contribution of 5%, and provide a vesting schedule of 20% per full year of service with full vesting realized after completion of 5 years. Currently, the City has one 401 retirement plan with the Mission Square, formally ICMA-RC Corporation, for Management employees. As indicated above, a new/secondary plan is required in order to provide the agreed upon retirement benefits.

It is recommended that the Mayor and Commissioner approve the attached Resolution allowing the City Manager to establish a new 401a plan, to be administered by ICMA-RC, with employee contributions in the amount of 5% and employer contributions of 5%, and a graded vesting schedule.

Funding for the retirement benefits in the amount of $26,105, are available in Adopted Operating Budgets for current fiscal year. Future funding shall be included in the Proposed FY 2023 Operating Budget.