County Offered $60-Million Benefits Deal
The Orange County Employees Retirement Board has offered to give the Board of Supervisors as much as $60 million to help bail it out of its current budget problems in exchange for concessions including medical insurance for retired employees for the next 20 years.
The medical insurance could cost the county nearly $5 million the first year and probably more in each subsequent year, said Keith L. Concannon, retirement board member. The county’s retirement system, which the retirement board administers, paid medical benefits to its members until 1979, when it decided that the practice was too costly.
The county’s retirement fund currently totals $1 billion. The $60 million, which would be given to the county over the next two years, would come from a $100-million surplus fund.
Hearings on the county’s tentative $2.2-billion 1988-89 budget are to begin Wednesday. Officials say the county is about $35 million short of what it needs to maintain all of its jobs and programs at current levels. At one point, officials said as many as 400 county workers might have to be laid off.
The nine-member retirement board, at a special meeting Monday, unanimously agreed to open negotiations with the Board of Supervisors on its proposal.
Supervisor Thomas F. Riley said later that county officials, including the auditor-controller, were discussing the proposal.
“We would have to determine if the offer is something that could be accepted or if there would have to be some changes,” Riley said. “There has already been a recommendation by staff that some of the things would not be acceptable.”
Riley said it would be “presumptuous” on his part to discuss at this point what those things are.
In addition to the prepaid medical insurance, the retirement board wants the county to:
- Allow elected members of the retirement board who are also county employees time off to attend board meetings or to travel to out-of-town meetings. Currently, retirement board members said, the four people who are elected to the board by their fellow employees or retirees must use vacation time when they are off the job on retirement system business.
- Provide retirement board members with worker’s compensation and disability insurance when they are at board meetings or traveling on board business. No such coverage is currently provided, members of the retirement board said.
- Provide the retirement board with an outside attorney when there is a conflict of opinion between the retirement board and the county counsel.
- Give the retirement board independent department status so that it reports directly to the Board of Supervisors rather than the county treasurer-tax collector. Members of the retirement board said that its current organizational status is too cumbersome.
- Allow the retirement board to set the salary of its administrator. The salary of the administrator is currently set by the Board of Supervisors.
Concannon, a member of the retirement board committee that devised the proposal, said the plan was suggested by members of the board who are employees of the county.
“They know that if the county does not get help that jobs will be lost,” said Concannon, who was elected to the retirement board by retirees.
Robert L. Citron, the county’s treasurer-tax collector and a permanent member of the retirement board, said, however, that Concannon suggested the offer in an effort to provide for the needs of his constituency.
The retirement board agreed in its vote Monday that no plan would be acceptable unless it would return to the retirement system $235 million over the 20-year period--the amount the $60 million would become if the retirement system invested it instead of giving it to the county.