LETTER OF AGREEMENT
BETWEEN
THE CITY OF RIALTO
AND
THE RIALTO CITY EMPLOYEES’ ASSOCIATION
The City of Rialto (hereinafter the “City”) and the Rialto City Employees’ Association (hereinafter the “Association”), jointly referred to as the “Parties”, agree to amend Article 6 in the Memorandum of Understanding.
Article 6, Cafeteria Benefit Plan
Employees in the Bargaining Unit shall be provided with a Cafeteria Plan that will be administered by the City pursuant to the Section 125 of the Internal Revenue Code. Parties agree that changes to cafeteria benefits will become effective the month following ratification of this agreement.
A. Employees Hired Before September 25, 2018
1. Employees have the choice of applying Cafeteria Plan dollars of $1 ,800 to purchase health, vision, and dental benefits provided through City plans for themselves and any dependents. Any amount not u sed to purchase such benefits shall be taken by the employee in taxable income.
The employee may also choose the opt- out provision of the cafeteria plan as outlines in this Section A(3) below.
2. The City will contribute the minimum employer contributions required pursuant to Government Code §22892(b) (“Minimum Contribution”) per month per employee for health insurance. The City shall pay up to a maximum of $1,800 per month inclusive of the minimum contribution towards the employee’s contribution for medical, vision, and dental insurance premiums. If the premium cost of the health plans (medical, vision, and/or dental) exceeds the City’s contribution of $1 ,800, the employee shall pay through payroll deduction the difference between the monthly premium and the amount contributed by the City.
3. The opt-out provisions will allow employees to receive a dollar amount that is not utilized to purchase any of the medical benefits through the City, which said dollar amount is up to one thousand one hundred dollars ($1,100) for each employee. Documentation is required to verify that the employee is receiving group insurance through his or her spouse’s (‘Spouse’ includes registered domestic partners throughout this MOU so long as required by California law) plan or group insurance through his or her parent as an eligible dependent before the employee may opt out. Employees may use some of the amount for benefits, with any unused amount of the City’s contribution to the Cafeteria Plan as taxable income or have said amount placed into a deferred compensation plan. An employee can still purchase dental and/or vision and receive the opt-out monies.
B. Employees Hired On or After September 25, 2018
1. Employees have the choice of applying Cafeteria Plan dollars of $1 ,800 to purchase medical, vision, and /or dental benefits provided through City plans for themselves and any dependents. Any amounts not used shall not be taken by the employee as taxable income or in deferred compensation.
2. The City will contribute the minimum employer contributions required pursuant to Government Code §22892(b) (“Minimum Contribution”) per month per employee for health insurance. The City shall pay up to a maximum of $1 ,800 per month inclusive of the minimum contribution towards the employee’s contribution for medical, vision , and dental insurance premiums. If the premium cost of the health plans (medical, vision, and/or dental) exceeds the City’s contribution of $1 ,800, the employee shall pay through payroll deduction the difference between the monthly premium and the amount contributed by the City.
3. Those employees that do not utilize the Cafeteria Plan allowance for medical insurance, there shall be no cash back to the employee. Those employees hired after September 25, 2018, who elect to opt out of medical insurance shall receive $100 per pay period (24 pay periods) opt -out allowance. An employee can still purchase dental and/or vision and receive these opt -out monies. An employee must provide the City with written notice/waiver of paid group health insuranc e premiums for which the employee is eligible. Then, the employee shall be provided up to 100% of the City contribution which may be taxable compensation or be placed into a deferred compensation plan. Documentation is required to verify that insurance is established.
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Beatriz Kuentz, RCEA President Date
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City Manager Date
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Eric Vail, City Attorney Date