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HomeMy WebLinkAbout030327 March 27, 2003 Hagerstown, Maryland A special meeting of the Board of County Commissioners of Washington County, Maryland, was called to order at 8:00 a.m. President Gregory I. Snook with the following members present: Commissioners James F. Kercheval, Doris J. Nipps, and John C. Munson. JOINT MEETING WITH BOARD OF EDUCATION The Commissioners met with the Board of Education at 8:00 a.m. The following members of the Board of Education were present: Bernadette Wagner, Edward Forrest, Roxanne Ober, Russell Williams, Jacqueline Fischer, and Paul Bailey. Staff members present were Dr. Elizabeth Morgan, Superintendent of Schools; Dr. Patricia Abernethy, Deputy Superintendent of Schools; Dennis McGee, Director of Facilities Management; William Blum, Chief Operating Officer; Chris Carter, Director of Transportation; Christian South, Director of Budget & Finance; JoEtta Palkovitz- Brown, Executive Director of Elementary Education; and Boyd Michael, Executive Director of Secondary Education. Update – “No Child Left Behind” Dr. Morgan reviewed the Board’s master plan for implementation of “No Child Left Behind” and “Bridge to Excellence” requirements. She stated that they would attempt to inform and involve the stakeholders in this process. Dr. Abernethy then showed a videotape outlining the master plan. She outlined the objectives and the plan for those students who do not meet the testing requirements. Dr. Abernethy reviewed the Grade 4 reading test scores and high school government testing scores that were broken down into categories showing the performance of Limited English Proficiency (LEP), Special Education, and Free and Reduced Meals (FARM) students. Dr. Morgan outlined the consequences for not meeting the standards and the interventions planned to bring these students into compliance. The meeting was then opened for questions and discussion. Commissioner Snook thanked the Board for the presentation. RECESS The Commissioners recessed from 9:15 a.m. until 10:00 a.m. OVERVIEW OF EMPLOYEES RETIREMENT PLAN Dee Hawbaker, Assistant Human Resources Director, introduced Jon Ketzner, Senior Actuary with BGS&G/CBIZ, who was in attendance to review the actuarial report on the County Employees Retirement Plan for the plan year beginning July 1, 2002. Mr. Ketzner reviewed the basic funding equation for self-insured pension plans, the key actuarial assumptions used in the County’s plan, and the key components of the annual funding requirements. He stated that the three sources of funding for the program are the County, the employees, and the revenues from investments. He also informed the Commissioners that there is an unfunded accrued liability of $1,872,234 due to the under- performing stock market. Mr. Ketzner concluded that the County’s plan is adequately funded, the benefit structure remains competitive, and the County funding should stay in the range of 8-10% of pay. Mr. Ketzner recommended making no changes in the actuarial assumptions at this time. He also reviewed the GASB methodology used to calculate the funding status. Mr. Ketzner then opened the meeting for questions and discussion from the Commissioners. DEFINED BENEFITS RETIREMENT PLAN Ms. Hawbaker introduced Virginia Rose, Rudy Carryl, and Claude Athaide of MacKay-Shields who were in attendance to review the performance of the defined benefits retirement plan. Ms. Rose introduced the members of the County’s investment team and provided an organizational overview of the company. She stated that the portfolio is composed of equities, fixed assets, and a small percentage of cash. Ms. Rose also stated there was a wide magnitude of disappointing returns across the equity markets. Mr. Carryl reviewed the performance of the retirement plan. He indicated that most factors suggest that the market is close to the bottom and is poised for better performance. Mr. Carryl stated that MacKay Shields MARCH 27, 2003 PAGE TWO bases its investments on the fundamentals, and he reviewed the process that MacKay-Shields uses in selecting stocks, as well as the risk controls. He also outlined the County’s largest positions as of June 30. He stated that the portfolio composition is made up of 54.5% equities, 42.7% fixed income, and 1.9% cash equivalents. Claude Athaide, manager of the Fixed Income Stock Portfolio, reviewed the portfolio for fixed income. He stated that it is a highly performing portfolio with good returns. Mr. Athaide also reviewed the defined benefit retirement plan and stated that it is a balanced growth portfolio. The meeting was then opened for questions and discussions. Commissioner Snook thanked them for the presentation. REVIEW OF HEALTH INSURANCE PROGRAM Mike Marchini, Employee Benefits Consultant with CBIZ, discussed the trends in health care nationally, health care costs, and recommendations for benefit levels and employee contributions. Mr. Marchini indicated that the trends are continuing upward with double-digit increases. He provided information on the dynamics behind what is happening in the industry and reviewed the equation for the budget calculation. Mr. Marchini estimated that there would be an 18.7% increase in the cost of the County’s health care costs next fiscal year. Mr. Marchini recommended adjusting the employee contributions from the current level of 8.2% to 10.0%. He also recommended that the County take no action this year to change benefit levels in light of the cost sharing change. The meeting was then opened for questions and discussion. ADJOURNMENT Motion made by Commissioner Munson, seconded by Nipps, to adjourn at 12:28 p.m. Unanimously approved. , County Administrator __________________________, County Attorney ___________________________,County