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HomeMy WebLinkAboutResolution 2009-055 Separation Incentive Plan (SIP) for FY 2010MARANA RESOLUTION N0.2009-55 .RELATING TO .PERSONNEL; APPROVING- AND AUTHORIZING STAFF TO IMPLEMENT THE SEPARATION INCENTIVE PLAN (SIP) FOR FISCAL YEAR 2010; AND DECLARING AN EMERGENCY WHEREAS the Town Council is authorized by A.R.S. § 9-240 (A) to control the finances of the Town; and WHEREAS the Town Council finds that authorizing staff to implement the Separation Incentive Plan (SIP) for fiscal year 2010 as described in the SIP program outline is in the best interests of the Town and its residents. NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COUNCIL. OF THE TOWN OF MARANA, ARIZONA, AS FOLLOWS: SECTION 1. The Town of Marana hereby approves the Separation Incentive Plan (SIP) for fiscal year 2010 as described in the SIP program outline, attached to and incorporated by this reference in this resolution as Exhibit A. SECTION 2. The Town's Manager and staff are hereby directed and authorized to undertake all other and further tasks required or beneficial to implement the Separation Incentive Plan, to include the execution of separation agreements in compliance with the provisions of the Separation Incentive Plan as described in the SIP program outline. SECTION 3. Since it is necessary for the preservation of the peace, health and safety of the Town of Marana that this resolution become immediately effective, an emergency is hereby declared to exist, and this resolution shall be effective immediately upon its passage and adoption. PASSED AND ADOPTED BY THE MAYOR AND COUNCIL OF THE TOWN OF MARANA, ARIZONA, this 28th day of April, 2009. ATTEST: ' , /~~ l .n °t.--~t..~ .~ ~..- ~..~ , J .~celyn C, ronson, Town Clerk ,1 Mayor Ed Honea APPROVED AS TO FORM: ~.:. -~ ~ ~ 'F ank Ca idy, Town orney SEPARATION INCENTIVE PLAN (SIP) PROGRAM OUTLINE The purpose of the Separation Incentive Plan (SIP) is to provide incentives to retirement-eligible and other employees who wish to voluntarily separate their employment with the Town in order to facilitate reductions to the FY 2010 budget during the current economic crisis. This program is being offered to afford the Town the opportunity to reduce positions based on voluntary actions in lieu of mandatory reductions, such as furloughs, job reductions or layoffs. The SIP, as described in this program outline, shall apply for FY 2010 only, subject to the timelines described herein. Eligibility This program applies to all Town departments and to all classified and unclassified employees who are retirement-eligible in either the Arizona State Retirement System or the Public Safety Personnel Retirement System and to all benefit-eligible classified and unclassified employees who elect to resign. Definitions 1. Benefit-eli ig ble-regular full- and part-time classified and unclassified employees. Part-time employees must have a normal schedule that is at least 20 hours but less than 40 hours per week. 2. ASRS-Arizona State Retirement System 3. COBRA-Consolidated Omnibus Benefits Reconciliation Act-provides that covered employees and their qualified beneficiaries may continue health insurance coverage under the Town of Marana's health plan when a qualifying event such as loss of employment would normally result in the loss of eligibility. 4. FY 2010-July 1, 2009 through June 30, 2010. 5. Incentives-one-time financial assistance to support the retirement-eligible or resigning employee in his or her transition. 6. PSPRS-Public Safety Personnel Retirement System. 7. Retirement-eli ible employees-employees who have accumulated the necessary credited service in a public entity retirement system or in the military service and/or attained the necessary age to qualify for ASRS or PSPRS retirement. 8. Timeline-the dates within which retirement-eligible and resigning employees must notify the Town of their decision to retire and/or resign. 1 EXHIBIT A Policies and Procedures Election 1. Employees who decide to separate their employment and take advantage of this program must notify the Human Resources Department of their decision to elect retirement or to resign. 2. The Human Resources Department must receive the notification by May 19, 2009 and the retirement or resignation must be effective by August 31, 2009. 3. The Human Resources Department will respond to all employees who elect to participate in this program and will contact ASRS or PSPRS as appropriate to facilitate employee consultation. Incentives 1. Sick-Leave Pa.~ Participants in the SIP will receive a 50% payout of their accrued sick leave. 2. Life Insurance Continuation. Participants will remain on the Town's basic life insurance plan at the Town's expense at one times their salary for one year. 3. Medical Plan Subsidv. Participants will receive a subsidy of $150 per month for six months following their separation to offset the costs of COBRA continuation coverage or coverage under the participant's retirement health care plan. This subsidy shall be payable either directly to the participant's health care plan or to the participant, as appropriate. 4. Severance Pay. Participants will receive severance pay in an amount equal to a percentage of the participant's annual base salary multiplied by the participant's length of service with the Town. The percentage of base salary that will be used to calculate a participant's severance pay will be based upon the participant's length of service with the Town as follows: Length of Service % of Annual Base Salary 0 to 10 years 1.5 > 10 to 15 years 1.75 > 15 years 2.0 Examples: • $40,000 annual base salary, 5 years of service: $40,000 x .015 = $600 x 5 years = $3,000 severance pay • $40,000 annual base salary, 11 years of service: $40,000 x .0175 = $700 x 11 years = $7,700 • $40,000 annual base salary, 16 years of service: $40,000 x .02 = $800 x 16 years = $12,800 2 EXHIBIT A Participants will receive credit for partial years of service under this formula. Notwithstanding this formula, the total amount of severance pay that will be paid to any participant is capped at a maximum of $50,000. Separation Agreement Employees who elect to retire or resign and accept the SIP incentives will be required to enter into a separation agreement with the Town. 3 EXHIBIT A