Department of Administrative Services
Reference: Discussion of FPPA (Fire and Police Pension Association) Legislation and Retiree Health Savings Amendment Request for Sworn Officer
To: Mayor Gregory Mills and Members of City Council
Through: Jane Bais DiSessa, City Manager
Prepared By: Karen Borkowski Surine, Administrative Services Director
Maria Ostrom, Finance Director
Date Prepared: 10/31/2020
PURPOSE
To discuss recent legislative changes regarding FPPA and receive direction from City Council.
STRATEGIC FOCUS AREA
Financially Responsible
BACKGROUND
The State passed HB-1044 modifying pension plans administered by the FPPA. This legislation makes changes to the required contributions in the SWD&D (Statewide Death and Disability Plan) beginning January 1, 2021. The act increases member and employer contributions to the SWD&D plan from 2.8% to 3% of base salary. The FPPA Board is authorized to increase the contribution rate by .2% annually. It is the City of Brighton’s decision whether this is paid by the member officer, employer, or split.
HB -1044 increases employer contribution rates in the SWDB (Statewide Defined Benefit) beginning January 1, 2021. The rates are increased from 8% - 12% of base salary and is implemented over the next eight years at an increase of .5% annually.
Reentry departments continuing rate of contribution will be .2% instead of 4%. In respect to this pension plan, reentry means officers that did not start with FPPA at the beginning of their employment. Police officers hired in 2005 or later are considered new and are not affected by this legislation. The City of Brighton has 12 members in the reentry category and 1 DROP (Deferred Retirement Option Plan) member. Reentry members pay 4% more to be in this plan until 2021. The continuing rate of contribution after this date is .2%. Any excess contributions above .2% will be deposited in the member’s Statewide Hybrid Money Purchase account.
ATTACHMENTS
1. PowerPoint
2. FPPA Resolution for reentry
3. FPPA Resolution for Multi-Employer Deferred Compensation Plan
4. FPPA Resolution for Death & Disability contribution rate