COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Employee and Public Services

DATE:

January 9, 2003

BOARD MEETING DATE:

January 28, 2003

TO:

Honorable Board of Supervisors

FROM:

Mary Welch, EPS Director

Paul Hackleman, Benefits Manager

SUBJECT:

Approval of Amendment to Mercer Agreement

Recommendation

Adopt a resolution amending an agreement with Mercer Human Resource Consulting for actuarial studies of the County's retirement plan options.

Background

During recent labor negotiations, Mercer provided numerous actuarial studies of options for the County's and labor's consideration (2% at 55, 2% at 55.5, 3% at 55 and 3% at 50) for both miscellaneous and safety retirement plans.

The initial actuarial work was performed through an original agreement totaling $54,000. As new requests were initiated for actuarial evaluations, the agreement was modified on August 16, 2002 to increase the overall amount to $99,000 and to extend the original end date of December 31, 2002 to March 31, 2003.

Discussion

Toward the end of negotiations, the County Manager's Office requested additional actuarial analysis on the 2% at 55 Plan, the cost of a domestic partner survivorship benefit and the exclusion of Plan 3 members. The additional costs from these final requests totaled $22,000 and took the contract above the limit. As a result, an amendment to the County's agreement with Mercer is requested.

Vision Alignment

The contract with Mercer represents Vision Statements # 20 which focuses on careful consideration of future impact and # 21 which incorporates the County's vision and goals into delivery of services.

Fiscal Impact

The additional cost of $37,000 represents the $22,000 in additional final work conducted by Mercer for the retirement plan modification options and $15,000 for any additional labor negotiation studies approved by the County Manager. These costs are budgeted in the Non-Departmental Fund #80110.