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Orange County <br />Board of Commissioners <br />Action Agenda Item Abstract <br />Meeting Date: January18, 2000 <br />Action Agenda <br />Item No. <br />Subject: ABC Board Retiree Health Insurance <br />Department: Personnel and Finance <br />Public Hearing: Yes No X <br />Budget Amendment <br />Needed: Yes No X <br />Attachment(s): Information Contact: <br />Elaine Holmes, Personnel Director <br />Draft Resolution Extension 2550 <br />Ken Chavious, Finance Director <br />Extension 2453 <br />Telephone Number: <br />Hillsborough 732-8181 <br />Chapel Hill 968-4501 <br />Durham 688-7331 <br />Mebane 227-2031 <br />Purpose: To consider a resolution expressing the Board of Commissioners' support for the <br />Orange County ABC Board's decision to provide the retiree health insurance benefit that it <br />had in place prior to January 1, 1998 to all its eligible employees, including those hired after <br />January 1, 1998. <br />Background: In March 1999 the ABC Board decided to extend the grandfather clause <br />instituted when it changed its retiree health insurance to cover all current ABC employees <br />who also were ABC employees as of the date of the change; that is, January 1, 1998. <br />In March 1999, the ABC Board decided to defer making any decision on reinstituting the <br />previous retiree health insurance policy to cover all employees; that is those hired after <br />January 1, 1998, pending further review. Since March, the ABC Board has reviewed the <br />retiree health insurance policy further. At its December 21, 1999 meeting, the ABC Board <br />decided to extend its previous retiree health insurance policy to cover all ABC Board <br />employees. The attached resolution expresses the Board of Commissioners' support for <br />this action and acknowledges that the payment of this benefit impacts the profit distribution <br />Orange County receives from the ABC Board. <br />Financial Impact: For the ABC Board as for the County, the costs for retiree health <br />insurance are funded as an operating expense on a pay-as-you-go basis. The ABC <br />Board's current costs for retiree health insurance are about $9,800. The earliest date any <br />additional cost from extending the policy to all employees would be incurred is at least 14 to <br />15 years in the future. This is because the employee has to have 15 years ABC Board <br />service and be eligible to retire. It is not possible to project with accuracy the cost of health <br />insurance or ABC employees who might potentially be covered that far into the future. <br />Recommendation: The Manager recommends the Board adopt the attached resolution.