HomeMy WebLinkAbout08-30-2010 . L. .
. CITY OF * CITY COUIVCIL
COMMITTEE OF THE WHOLE
* WASHINGTON August30, 2010 5:00 PM
Council Chambers
COMMITTEE OF THE WHOLE AGENDA
1. Retirement Benefits* (Councilmember Partridge) 15 min
il.. Transportation, Eurrent projects (Dowdy) 45 min
III. Tcansportation, fufure transportation projects (Dowdy)
45 min
IV. Liquor Privatization Initiatives* (Coleman) 15 min
OTHER ITEMS MAY BE DISCUSSED BY THE COMMITTEE OF THE WHOLE.
NO ACTION WILL BE TAKEN BY THE COUNCIL ON ANY ITEM DURING A
` COMMITTEE OF THE WHOLE MEETING.
Page 1 _
~ •
: . . , .
~ . Y ' • . . ,
•4
"l
!
~ " ~ es a .l~~t ct o , ~o ~ c~ = a ees
• ` Y~a~u~ara~ oc ~~m mb,e ~o ao ~ £Stha plan ~ 5" ~ o ,
kk,~
.i r~Tnu ~ia.ve j e.~e been' a.~m her•o txe~nent '~s~~r o, V, s, ; n. ~
,
_
C
When can 1 apply for membership3
You may apply for membership at.any time during your current term of office. If you enter membership after
your current term of office has begun, membership will be retroactive to the first. day of your current term of
office. You will be required to pay employee contributions plus interest back to the first day of your term.
Your membership decision is final: Once you have established retirement system membership, you must
remain a member until you separate from all eligible public employment. If you serve an additional term of
office with the same employer without a break in service, you will remain a retirement system member until you
terminate employment. If you sepazate from service and leave office, you will not be considered separated if you
. return to office for the same employer during the term in which you left.
Can I receive credit for past elected service?
When you have established membership for your current term, you may have the option of purchasing service
credit for any'previous term or terms of office during which you did not choose to apply for membership.
Membership will be granted retroactivelyto the beginning of your elected service.
To receive service credit for any previous term or terms of elected service, you must pay the required employee
and employer contributions and interest, as determined by DRS. Your employer may elect to pay the required
employer contributions and interest for you.
All prior consecutive service must be purchased. If you have served multiple terms in ~
office with different employers, you may purchase credit for service with each employer
independently. If you do not choose to become a member while holding elected office, and D
later become an active PERS Plan 2 or Plan 3 member in a non-elected position, you m a y q A 5 H 1 N G i O N S T A T E
then purchase credit for your elected service. DepartmeM of
RetiremeM Systems
ASHINGTON STA PUBLIC . O . .
}
P__ R
You may purchase service credit for eleeted service performed prior to September 1,1991, only:
. if you were compensated for-more than 90 times the state minimum wage; and
• for months in which your service totaled 90 or more hours. • Note: For periods from January 1, 1987 through August 31, 1991, employee and employer contributions: are due .
only for months ihat service credit was received.
Note: For periods prior to January 1,1987, employee and employer contributions are due for any months
worked, including months that service credit was not earned
How much service credit will 1 earn?
The amount of service credit you earn helps to determine the size of your retirement benefit.
For each month that you earn 90 times the state minimum wage, you will receive service credit as followsc.
. 90 or more hours = One service credit month
• At least 70, but fewer than 90 hours 5 service credit month
. Less than 70 hours = Z5 service credit month
What will :my retirement benefit be?
The portion of your benefit that is based on Plan 2 service credit will be based on the _following formula:
2 percent x service ciredit years x Average Final Compensation = Monthly benefit
If you are a PERS Plan 3 member you will receive a split benefit The defined contribution gortion of your
benefit will be determined by the amount of your contributions and their investment earnings. The defiried
benefit portion of your plan will be deteimined by the formula: '
1 percent x service credit years x Average Fina1 Compensation = Monthly benefit
Average Final Compensation (AFC) is the monthly average of your 60 consecutive highest-paid service credit
months. Not included are payments for any type of severance pay, such as lump-stun payments for deferred sick
leave, vacation or annual leave.
,
: .
PLANS
. R
2 3
How much will 1 contribute to my retirement plan?
Plan 2¢ontribution rates aze variable and.may be changed as.necessary_to reflect the cost of the plan.
In Plan 3, the amount you contribute depends on the contribution rate. option you choose. Plan 3 features six
contribution rate options that, once selected, may only be changed if you change employers.
The Plan 3 contribution rate options are:
. Option A: 5% fixed at all ages
• Option B: 5% up to age,35; 6% ages 35 to 44; 7.5% age 45 and up
• Option C. 6% upto age 35;.7.5% ages 35 to 44; 8.5% age 45 and up
. Option D: 7% fixed at all ages
. Option E. 10% fixed at, all ages
• Option F: 15% fixed at all ages
Can I retire and retain my elected position? You may retire and retain your elected position if
. In that position, you earn less than $22,355 (as of 2006) adjusted annually for inflation, and
. You abandon claims for credit for future periods of elected service.
V1/hat if I am a retired PERS Plan 2 oe- PERS i'lan 3 member when elected?
If you are a retired PERS Plan 2 or PERS Plan"3 member when eleeted to off ce, you can choose to either remain
retired and continue receiving your retirement allowance while serving in office, or return to active member
status while serving in office.
If you ctioose to remain retired while in office, you can work up to 867 hours in a calendar year without loss
of benefits. Your benefits will be suspended if you workbeyond 867 hours in a calendar year, and will:remain
suspended until you terminate PERS-covered employment or until the end of the calendar year, whichever
comes first.
If you return to active member status, you will stop receiving a monthly retirement benefit, and you will resume
making contributions to your retirement system and accumulating service credit prospectively from ttie first day
of the month following the date the departmerit accepts your application for membership.
~PLANS
PERS'l
How do 1 enroll? '
To begin, continue or re-establish PERS Plan 2 or Plan 3 membership, contact DRS and provide the following
informatiom -
, Name
• Social Security number
. Address and phone number
. Position title. and employer
• Beginning and ending dates of all elected.official service
DRS will send you a letter and agplication once you provide us with all of these items.
To Learn Irloe-e
More information about Elected Officials is available on the DRS Web site or by contacting DRS. Additional
ri,iles governing all PERS Plan 2 or Plan 3 members aze summarized in the PERS Plan 2 or PERS Plan 3 Member
Handbooks, To o6tain a copy of a member handbook, visit the DRS Web site at www.drs.wa.gov or contact DRS.
Web site:_ www.drs.wa.gov
Tel.ephone: . 1-800-547-6657; or (360) 664-7000 in the Olynipia area
TDD: 1-866-377-8895; or (360) 586-5450 in the.Olympia area
E-mai1: - recep@drs.wa.gov
Address: , P.O. Box 48380
Olympia WA 98504-8380
June 2010 Y~ x 4 A r
.,.s~iS~~~~~~ ~ { ~ ~ R a~ ~ € r 1`~'`~~~1,~„~~^~, ~ ~ ."•,a ~~e~'~",~'",~ ~ ~
P ''w~-'`vF?e e~ +I"R~, '~.r.~r"''~". ~ ~iy . . " ~ r~,~ ar~ t y~ 'r,j'.,~'.~. t~, F'*«. e . s ,^°L~K -
Surr+maryaDescnptaon~, 14
T'he ~ctual,prct~s~n~~govemYn2;Elgct ~ l~s~tr~~c~ed~ n,thexR Snse ` eg~to 6h~ i
3~aaP 5 ~41 49 ~ ~ Y ~i.h ~~r
svmmax, r of tho~~`'~gptovisions~ot a'co~ et~'~esc gti~ f th~'l~wrsIf~~an
~ 54
~"€v~x.t2 ..~r*rxe-R?.~m.`~'~. pubhcahon~andh t ~sYcontauie ~ `~ftie-la~ ~ Re;appiicable~law ~vill~go~ea~ ~r
-
,N.1.~ '.yict. s q„} ~ ~~-F t •-.r, ~
r ;..`.i' ,i • ti - _ ~
i
i
r ~
~
Liquor Privatization Initiatives
MRSC left °bone dry"
By Rich Yukubousky, Executive Director, Municipal Research and Services Center
Retween 1945 and 1999, the motor vehicle excise tax was the fund source that cities
• Uused to fund services received from the Municipat Research and Services Center (MRSC).
That era ended when the voters passed Initiative 695, abolishing the motor vehicle excise
tax. Although Initiative 695, which repealed this tax in 1999, was found unconstitutional,
the 2000 legislature decided that the people had spoken and repealed this tax, replacing
it with a$30 license fee.1 Cities urged the legislature to continue funding MRSC and to
replace funds lost with a small fraction of the cities' distribution of liquor profits.
_ . This year there are two initiatives that could adversely affect tocal government funding,
including most of the monies used by MRSC to provide services to cities and counties. The
purpose of this brief article is to alert local officials that our funding is once again at risk
and that we wi!l be seeking an alternative way to fund MRSC if one or both of these initia-
' • ' tives pass in November.
This article is provided for informational purposes in response to questions received from fo-
cal officials. It is not intended to express support or opposition to the initiatives.
Liquor Receipts - Profits and Taxes
Since cities and counties are responsible for the policing of liquor establishments located
within their limits but are precluded from taxing tfiem because of the state liquor monopoly,z
state law provides that a share of the state-collected profits and taxes be returned to cities
and counties to help defray policing costs.
Liquor board profits consist of the difference between revenue generated by the Washington
State Liquor Control Board and the board's expenditures, specific revenues collected for.a
dedicated purpose, and administrative fees attributable to specific licensees that serve hard
alcohol. Revenues are generated from sales at state liquor stores, taxes collected on wine
and beer manufacture and distribution, licensee fees, alcohol related permit fees, penalties,
and forfeitures.
Liquor profits are divided among the state, counties, and cities. Fifty percent goes to the
state general fund, 10 percent goes to counties, and 40 percent goes to cities. The county
and city amounts are distributed on a per capita basis on the last days of March, June, Sep-
tember, and December. An additional small amount is distributed to border cities and towns
and Point Roberts.3
continued on page 3
. for excellence in local government
a
Liquor Privatization initiatives continued trom pa9e t ,
The state receives 65 percent of the liquorexcise taxcollections, with eities getting 28 percent and counties getting 7 percent 4
' These funds are distributed. on a per capita 6asis,on the last days of January, April, July, and October. -
How wou/d the initiatiVes impact fhese distributions?
I-1100 would maintain the liquor excise tax but would repeal the, liquor profits distribution, because the system wouldbe
privafized and pro,fits would go to the retailers: :
I-1105 would remove both the liquorexcise tax and liquor profit distributions: I-1105 has intenf language in Section,101(1)
that the privatization of liquor sales and d'istribution °not result in reVenue losses to state ~or local govemments" and then more '
prescriptiye language in Section 101(3) directing the Liquor Control Board to;recommend to the legi5lature °a rate of faxation
that, along with otherspirits-related revenue sources, would project to generate at least the same annual revenue for the state
and local jurisdictions as under the current state control system..."
Note that if I-1053 were also to pass, it would be far more challenging to enact new or replacement tax rates on liquor sales.
I-1053 would require a two-thirds affirmative vote by the state legislature.to adopt new taxes or user fees.
Whaf are the impacts on /oca/ govemment?
According to estimates in MRSCs Budget Suggestions for 2011., the distributions of liquor profits and excise taxes to cities
and counties are as follows:
- - ~ - - - -
Liguorprofits ~ . $27.,090,572_ $28,014,708 $34',072,000 $31,200,000
Per capita profits $6.73 $6.87 $8.21 $7.34
Liquor eucise tax $19,301,609 $1,9,902,527 $20,551,000 $21,161,000 .
Per capita liquor tax $4.80 $4.88 $4.95 $4.98
.3. . a ~ m_~.... . x
Liquor profits $7;329,892 . , . $7,564,488 ; $9,082,000 _ $8,364,000 .
Per capita profifs $2.90 $2.96 $3.56 $3.30
Liquor excise tax $4,401,902 $4;528;882 $4,668,000 : $4,820,000, Per capita lipuor tax $1J4 $1.77 $1.83 $1.90
The Office of Financial Management is required to develop a fiscal impact note detailing the way an initiative imPacts state and _
'
local govemments. The fiscal note for these initiatives was due by August 10, 2010.
I-1100 also removes the fundingsource for enforcement, while I-1105 does not provide an assured funding source for this.
Coupled with the fact that the approximate 300 liquor sales outlets under the current system are estimated to multiply to
5,000 or so outlets, there could be an impact on local law enforcement. (Association of Washington Cities Interim'Legislative :
Bulletin #2, July 9, 2010.) .
MRSC Funding . . .
Nearly all the funding for MRSC is derived from liquor profits and taxes. The city portion of MRSC's programs and services is
funded from a small share of the cities' distribution of liquor profits, and the county program is funded from the counfies' share
of liquor excise taxes. You might ask why MRSC is funded in this manner. The conceptual approach that has been used Histori=
cally to fund MRSC is to tap a fund that is collected by the state and distributed back #o local govern.ment. This produces a_
program that is owned by local governments for the purpose of ineeting critical needs of local govemment. An appropriation.^. :
continued on page 4
Municipal Research News - Summer 2010 9 3
.
; .
Liquor Privatization initiatives continued from paye 3
is made to a, state agency - formerly the Municipal Research Council and now the Department of Commerce - to contract for
the provision of specifed services by a qualified provider.. MRSC, and its predecessor, the University of Washington Bureau of
Govemmental. Research, has been that pravider for 76 years. This approach insures that all cities and counties share in the
funding of services. Ifone orboth of these initiatives pass, MRSC will need your support. We are currently identifying options to fund MRSC, and if
you haye any suggestions, pfease pass them on.
We think that, MRSC is a model of government efficiency:
• By pooling resources, local govemments gain access to services they could nofi afford to proVide alone. MRSC is a national
model of intergovemmental cooperation providing efficient, shared services.
• MRSC saves money for Jocal governments in Washington State by providing quality and expert advice and research.
• Liability is reduced through timely advice.
_ • MRSC serves as a clearinghouse for examples of successful solutions, saving Iocal govemment time and money while
1 enhaneing the quality of iocal service delivery.
For further information about these initiatives, please see out website http://www.mrsc.ag. We will be posting information
about tfie'impacts of the initiatives, linksto important documents and news articles, and editorials and opinions:l
1Ch. 2, Laws of 2000, lst sp. sess.
2"Locally Shared LiquorProfits and Taxes,° (source unknown) July 27. 1962, mimeographed copy in MRSC files.
3RCW 66.08.190(1)(a) and RCW 66.08.195.
4RGW 82.08.160 specifies that 35 percent of the total tax collected under RCW 82.08.150 must be deposited in the "liquor excise tax fund.° Per
RCW 82.08.160, 80 percent of the monies in the liquor excise tax fund is distributed to cities. (.35 x.8 =:28) Twenty percent is distributed to counties,
(.35 x .2 = .07) W, •4 ~
I,
~
e • ~ o.
~
4. Municipal Research News - Summer 2010