The Department of the Treasury and the Internal Revenue Service released new guidance that is “designed to expand the use of income annuities in 401(k) plans.”
Aug. 19--With Miami-Dade County's budget clock ticking, Mayor Carlos Gimenez's administration has dropped a key demand it was making of labor unions, in a bid to unstick contract negotiations.
Gimenez's decision to stop trying to block $40 million in pay perks from "snapping back" to workers on Oct. 1, as scheduled, means the county is likely to see at least some service reductions and employee layoffs in the coming budget year. The mayor had said his "best-case scenario" budget would continue the pay concessions, which unions agreed to three years ago, until 2017.
While abandoning that request could result in job losses and service cuts, county negotiators hope the gesture will make union leaders more willing to adopt a more restrictive health-insurance plan that could save Miami-Dade$50 million in the $4.5 billion operating budget for 2014-15. Those savings would stave off some of the potential cutbacks -- including all remaining police layoffs -- but not all of them.
Lead negotiator Tyrone Williams formally announced the county's latest position Monday in a session with the American Federation of State, County and Municipal Employees Local 199, which represents general-government workers and has perhaps the most cordial relationship with Miami-Dade among the county's 10 collective-bargaining units.
"The reason we're doing this is we deeply appreciate 199's desire to negotiate with Miami-Dade County," Williams said. He had hinted at the county's move at an initial negotiating session last week.
Among the perks are an extra $50 in each paycheck -- which critics deride as "breathing pay" because no additional work is required to receive the payments -- and added pay for working holidays.
Union administrator Andy Madtes said Monday he was grateful for the change -- and indicated his members might go along with the scaled-back health- care benefits if Miami-Dade commits to some sort of salary raises in the next three years.
"If we could get closure on some type of understanding on wage increases moving forward, I think we're going to get where we need to be on health care," Madtes told Williams.
So far, Miami-Dade has rejected the union's proposal to pay employees a 2 percent cost-of-living increase in 2016, and a 3 percent cost-of-living increase in 2017.
An agreement with one union -- especially with AFSCME Local 199, the largest single bargaining unit, which represents more than 9,000 workers -- could make it more likely for the remaining bargaining units to reach similar deals. Madtes said Thursday that more than one union would have to be on board with the new health-care plan.
"You can't just have one union do it and the rest balk at it," he said at the negotiating table.
Gimenez has proposed replacing one of the county's three healthcare plans -- the low-end one -- with a new option, called "select," that offers a smaller physician network but more-affordable premiums to cover spouses and children. Dependent premiums would be about 20 percent lower than for the next-best plan, according to the county, to allow lower-wage workers to insure their families.
Seventy percent of physicians in the existing network would be included, Miami-Dade administrators say.
Employees at the public Jackson Health System have had the select plan option for a year. The network includes Jackson doctors as well as those from other major hospital systems, such as Baptist and Memorial.
With the select plan, county workers would not have to pay premiums for their own coverage.
But as part of Gimenez's proposal, they would be responsible, for the first time, for premiums for the middle-of-the-road plan, an HMO. Individual employees would have to pay $75 every two weeks for coverage. The high-end POS plan would continue to charge premiums, which would increase to $100 per pay period from about $15. For both the HMO and POS plans, dependent premiums would remain flat.
Co-pays would go up for emergency-room visits and for brand-name pharmaceutical drugs, to give employees an incentive to use urgent-care centers and generic brands, Miami-Dade administrators say.
"Our current co-pays for emergency room and our current co-pay for urgent care is exactly the same: $25," Arleene Cuellar, the county's human resources chief, said last week. "What's billed to the county [for an emergency room visit] is significantly higher."
Emergency rooms should still be used for emergencies, she added.
Gimenez's administration found a more willing negotiating partner in Madtes, who has flown with the mayor to tour New York City clinics created by unions and the industry for hospitality workers.
Madtes took over his union's reins in January and participated in a labor healthcare committee that proposed ways for the county to save money on insurance. He has pushed for a permanent committee to review healthcare costs and said that if his union agrees to the insurance-plan changes, then the $5.2 million in savings that it could bring should go to saving his union's 395 positions on the chopping block.
"We don't want people losing their jobs," he told the county last week.
Gimenez plans to implement the healthcare changes for non-unionized employees, including department directors and county commissioners' staffs. That would amount to a $2 million savings. Insurance enrollment usually begins in late October.
Though the unions were slated to get back their pay perks anyway, voluntarily withdrawing the issue is the county's attempt to try a softer negotiating tack as the end of the budget year approaches. Labor leaders could still propose to extend the concessions themselves, though that appears unlikely.
County commissioners must sign off on a spending plan after two public hearings next month.
Gimenez already dropped his initial request for a 10 percent salary cut across the board, which was met with resounding labor opposition.
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