HomeMy WebLinkAboutResolution No. 2014-67Suggested by: Administration
CITY OF KENAI
NO. 2014 -67
A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AUTHORIZING
AMENDMENT TO THE CITY'S HEALTH CARE FLEXIBLE SPENDING ARRANGEMENT
FLEXIBLE BENEFITS PLAN DOCUMENT.
WHEREAS, Provisions of the Affordable Care Act limited the maximum amount an
employee could contribute annually to a medical flexible spending arrangement (FSA)
account; and,
WHEREAS, on October 30, 2014, the IRS released Revenue Procedure 2014 -61,
containing inflation adjusted amounts for FSA's which increased the employee
maximum contribution from $2,500 to $2,550; and,
WHEREAS, the recommended plan amendment will allow for automatic increases of
the plan maximum when IRS changes are made to the indexed amount.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI,
ALASKA, the City Manager may amend the City's Health Care Flexible Spending
Arrangement Plan Document to increase the employee maximum contribution to the
Internal Revenue Service's new indexed amount of $2,550 for play year 2015 and
future plan amendments will automatically occur when the Internal Revenue Service
changes the indexed employee maximum contribution amount.
PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 17th day of
November, 2014.
PAT PORTER, MAYOR
A T:
San i I digh, City Clerk
Approved by Finance:
"Villaye with a Past, Git with a Future
FINANCE DEPARTMENT
210 Fidalgo Avenue, Kenai, Alaska 99611 -7794
Telephone: 907 - 283 -7535 / FAX: 907 - 283 -3014
po: Rick Koch, City Manager
✓%1 From: Terry Eubank, Finance Director
// Date: November 10, 2014
Re: Resolution 2014 -67
The purpose of this memo is to recommend adoption of Resolution 2014 -XX. Resolution 2014-
67 will authorize the City Manager to amend the City's Health Care Flexible Spending
Arrangement Plan Document to increase the maximum allowable employee contribution to the
Internal Revenue Service's new indexed amount of $2,550 per year. The current maximum
annual employee contribution is $2,500 per year.
The requested amendment will also make amendment of the plan document automatic in regards
to the employee maximum annual contribution. The maximum amount will automatically
change anytime the Internal Revenue Service changes the indexed employee maximum
allowable contribution.
Increasing the maximum allowable contribution by employees does increase the City's risk.
Employees that terminate employment during the plan year may have been reimbursed by their
Health Care Flexible Spending Arrangement account more than they have contributed prior to
leaving the City. This risk exists today and a $50.00 increase in the maximum contribution is not
viewed as a significant amount of new risk for the City.
FLEXIBLE BENEFITS PLAN
HEALTH CARE FLEXIBLE SPENDING ARRANGEMENT INDEXED MAXIMUM
AMENDMENT
ARTICLE I
PREAMBLE
1.1 Adoption and effective date of amendment. The Employer adopts this Amendment to City of Kenai Flexible Benefits Plan
(the "Plan'). This Amendment shall be effective on or after the date the Employer elects in Section 2.1 below.
1.2 Supersession of inconsistent provisions. This Amendment shall supersede the provisions of the Plan to the extent those
provisions are inconsistent with the provisions of this Amendment.
1.3 Construction. Except as otherwise provided in this Amendment, any reference to "Section' in this Amendment refers only to
sections within this Amendment, and is not a reference to the Plan. The Article and Section numbering in this Amendment is
solely for purposes of this Amendment, and does not relate to any Plan article, section or other numbering designations.
ARTICLE II
ELECTIONS
2.1 Effective Date. The provisions of this Amendment, unless otherwise indicated are effective as of January 1, 2015 (effective
date).
2.2 Health Care Flexible Spending Arrangement Indexed Maximum.
On October 30, 2014, the IRS released Revenue Procedure 2014 -61, containing inflation adjusted items for 2015. For taxable
years beginning in 2015, this guidance increases the amount an employee may contribute to a health flexible spending
arrangement from $2500 to $2550.
The Employer hereby amends their plan maximum to the inflation adjusted maximum amount for health care flexible
spending arrangement effective January 1, 2015.
For future plan years the health care flexible spending arrangement maximum will automatically increase to the indexed
amount.
This amendment has been executed this 18 day of November , 2014
Name of Employer:
By:
EMPLOYER
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CERTIFICATE OF ADOPTING RESOLUTION
The undersigned authorized representative of City of Kenai hereby certifies that the following resolutions were duly
adopted on _November 17. 2014_ (date) and that such resolutions have not been modified or rescinded as of the date hereof,
RESOLVED, that the Amendment to the Plan (the Amendment) is hereby approved and adopted, and that an authorized
representative of the Employer is hereby authorized and directed to execute and deliver to the Administrator of the Plan one or
more counterparts of the amendment.
The undersigned further certifies that attached hereto is a copy of the Amendment approved and adopted in the foregoing
resolution.
Date: November 18 2014
Signed:
Rick Koch / City Manager
[print name /title]
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SUMMARY OF MATERIAL MODIFICATIONS
for the
City of Kenai
Flexible Benefits Plan
INTRODUCTION
This is a Summary of Material Modifications regarding the City of Kenai Flexible Benefits Plan (the `Plan"). This is merely
a summary of the most important changes to the Plan and information contained in the Summary Plan Description ( "SPD ")
previously provided to you. It supplements and amends that SPD so you should retain a copy of this document with your copy of
the SPD. If you have any questions, contact the Administrator.
II
SUMMARY OF CHANGES
Health Care Flexible Spending Arrangement Indexed Maximum.
On October 30, 2014, the IRS released Revenue Procedure 2014 -61, containing inflation adjusted items for 2015. For taxable
years beginning in 2015, this guidance increases the amount you may contribute to a health flexible spending arrangement from
$2500 to $2550.
The Employer hereby amends the plan maximum to the inflation adjusted maximum amount for health care flexible
spending arrangement effective January 1, 2015.
For future plan years the health care flexible spending arrangement maximum will automatically increase to the
indexed amount.
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