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2002-08-01 CC MinutesCity of Farmers Branch City Council Special Meeting Agenda City Hall Plaza 13000 William Dodson Parkway Fanners Branch, Texas Thursday, August 1, 2002 4:00 p.m. The following members of the City Council were present: Mayor Bob Phelps Mayor Pro Tern Charlie Bird Deputy Mayor Pro Tern Paul Walden Councilmembers Bill Moses Jim Robbs The following member of the City Council was absent: Calla Davis The following members of the Administration were present: I City Manager Assistant City Manager Assistant City Manager Finance Director Director of Human Resources Assistant to the City Manager City Attorney Engineering Director Communications Director Director of Community Services Director of Parks and Recreation Recording Secretary Richard Escalante Linda Groomer John Burke Charles Cox Janet Goad John Roach Stan Lowry Jerry Murawski Tom Bryson Michael Spicer Jeff Fuller Suzanne Reynolds A.0 CALL TO ORDER. Mayor Phelps called the City Council Special meeting of August 1, 2002 to order at 4:01 p.m. The meeting was televised. Mayor Phelps asked to let the record show that Councilwoman Davis was not in attendance. A motion by Mayor Pro Tern Bird, seconded by Deputy Mayor Pro Tern Walden, all voting "aye," excused Councilwoman Davis' absence. Volume 89, page 23 A.1 CONSIDER ADOPTING RESOLUTION NO. 2002-079 AWARDING THE BID AND AUTHORIZING THE CITY MANAGER TO ENTER INTO A CONTRACT FOR EMPLOYEE HEALTH INSURANCE AND TAKE APPROPRIATE ACTION. Mayor Phelps presented the following information. The City offers a competitive employee benefit plan including health insurance in addition to core benefits including basic coverage for life, accidental death and dismemberment, and long-term disability. City employees are responsible for paying a portion of the dependent health coverage. The contract for health insurance is scheduled for renewal on September 30, 2002. The City advertised for employee health insurance in June 2002, sending requests for bids to 22 carriers. On June 22, 2002, two bids were received from CIGNA and Humana, Inc. and one renewal proposal was received from current provider HMO Blue Texas. The bids and renewal were evaluated by a committee comprised of city staff members and with the assistance of Resource Financial Group, Inc., an independent benefits consultant. Both the CIGNA bid as well as the HMO Blue Texas renewal proposal represented increases in the current rates of more than 50 percent, or a budget impact of almost $1.4 million. At the July 22, 2002 Study Session meeting, staff presented Council with an overview of the low bid proposed by Humana for City employee health insurance. The presentation addressed healthcare trends, proposed program benefit comparisons, contributions, and contract approval deadline. Due to rising medical and prescription costs and their impact on insurance premiums, coupled with the impact of the economy, the City proposes to offer a different health insurance plan design that includes two health plan options for employees. A basic health plan will be offered, and employees may also choose to buy-up to a more enhanced plan. Under the new plan, the employees' share of their health insurance premiums will increase. In addition, they will also pay a greater share of actual medical costs due to the plan moving from primarily a plan based on co-pays, to one based more on a combination of co-pays and deductibles, resulting in greater employee out-of-pocket costs for healthcare. In the long term, these changes should help control the City's cost of providing employee health insurance while maintaining a competitive benefit for employees. At the July 22 meeting, staff s recommendation for employee premiums was that the City pay 100 percent of the basic plan employee-only rate, and 95 percent of the basic plan dependent coverage. However, due to economic changes, the recommendation for employee health insurance has been modified. Staff recommends the City fund 100 percent of the basic plan employee-only premium, and 90 percent of the basic plan dependent premium. Also subsequent to the July 22 Study Session, Humana representatives contacted the City to advise that they had made an error in their bid proposal. The proposal showed that in-vitro fertilization was a covered benefit; it is not a covered benefit at the rate that was proposed by Humana. The City could require that this benefit be covered as it was bid; however, the impact on subsequent years would likely result in significantly increased rates. The error was reviewed with the City Attorney, and staff recommends that the City Manager be authorized to execute a change order to the contract excluding in-vitro fertilization from coverage. The proposed 2002-2003 budget includes $2,453,554 for employee health insurance. Volume 89, page 24 The Human Resources Director recommends adopting Resolution No. 2002-079 authorizing the City Manager to enter into a contract for employee health insurance with Humana, Inc. and to execute a change order to the contract excluding from coverage in-vitro fertilization. Richard Escalante, City Manager, stated there was a lengthy presentation on this subject at the Study Session on July 19, 2002. He stated staff and representatives from Humana, Inc. were present to answer any questions the City Council may have. Mr. Escalante stated staff worked long and hard on this project. There being no further discussion, a motion by Deputy Mayor Pro Tem Walden, seconded by Councilman Moses, all voting "aye," adopted Resolution No. 2002-079 authorizing the City Manager to enter into a contract for employee health insurance with Humana, Inc. and to execute a change order to the contract excluding from coverage in-vitro fertilization. A.2 CONSIDER ADOPTING RESOLUTION NO. 2002-080 AWARDING THE BID AND AUTHORIZING THE CITY MANAGER TO ENTER INTO CONTRACTS FOR EMPLOYEE SUPPLEMENTAL INSURANCE AND TAKE APPROPRIATE ACTION. Mayor Phelps presented the following information. Offering optional benefit programs enhances the attractiveness of the employee benefits program available through the City. Under the current practice, employees may purchase optional supplemental insurance packages that cover: • Short-term Disability • Universal Life • Cancer • Critical Illness • Short and Long-term Hospitalization • Short and Long-term Intensive Care • Short and Long-term Illness Currently, the City has agreements with Colonial Life and Accident Insurance Company and with American Heritage to provide these optional benefits to City employees. To provide the most comprehensive programs and competitive pricing and to formalize the process, staff chose to bid the supplemental insurance lines, although this is not a legally mandated process for employee-paid supplemental insurance. The City solicited thirteen (13) vendors and received three bids, opened on July 10, 2002, from the following vendors: American Family Life Assurance Company of Columbus (AFLAC) Colonial Life and Accident Insurance Company American Heritage The main difference between the AFLAC, Colonial, and American Heritage is the schedule by which benefit disbursements are made to employees; employees may prefer one program over the other at their own discretion. All three companies have the same supplemental plans, with one exception. AFLAC offers long-term care insurance, whereas, the other providers do not. Volume 89, page 25 The plans contain complementary features with respect to City health and core benefit plans. The premium rates proposed to City employees are fixed for a three-year period under the proposal. Therefore, with those considerations, staff recommends that the City offer the employees multiple options and include all three providers of AFLAC, Colonial Life and Accident Insurance Company, and American Heritage. The Human Resources Director recommends adopting Resolution No. 2002-080 authorizing the City Manager to enter into contracts for supplemental insurance with AFLAC, Colonial, and American Heritage. There being no discussion, a motion by Councilman Moses, seconded by Councilman Robbs, all voting, "aye," adopted Resolution No. 2002-080 authorizing the City Manager to enter into contracts for supplemental insurance with AFLAC, Colonial, and American Heritage. A.3 CONSIDER RESOLUTION NO. 2002-097 CONVEYING A SPECIAL WARRANTY DEED DONATED BY THE CITY OF FARMERS BRANCH BACK TO TRANSCONTINENTAL REALTY INVESTORS, INC., THE INITIAL GRANTOR, AND TAKE APPROPRIATE ACTION. Mayor Phelps presented the following information. On October 16, 2000, the City Council approved by Resolution No. 2000-170 accepting a special warranty deed from Transcontinental Realty Investors, Inc. for the donation of a 2.021 acre tract of land on Mathis Street at Crown Drive for the City to construct a new elevated water storage tank that was to be 155 feet in height. The new-elevated water tank is one of the improvements proposed to facilitate the creation of a third pressure plane within the City's water distribution system. After donation of the subject tract of land, the height of the proposed tank was increased from 155 feet to 235 feet to increase the operating pressure of the proposed third pressure plane. The Federal Aviation Administration Agency subsequently determined the proposed tank could not be placed at the subject location because the increased height of the tank would intrude into the glide path of Love Field. The proposed tank will now be constructed north of Valley View Lane, at the end of Davis Drive. The tract cannot be used for the purpose and consideration for which the City persuaded Transcontinental Realty Investors, Inc. to donate subject property; consequently, the tract should be reconveyed to the Grantor, Transcontinental Realty Investors, Inc. The return of the property has been contemplated since it was determined that the property could not be use for the elevated tank. The return of the property is on this City Council agenda so that the property can be rezoned with adjacent property owned by Transcontinental Realty Investors, Inc on the August 19, 2002 City Council agenda. The City Attorney and the City Engineer recommend the adoption of Resolution No. 2002-097 conveying a Special Warranty Deed donated by the City of Farmers Branch back to Transcontinental Realty Investors, Inc., the initial Grantor. Volume 89, page 26 Richard Escalante, City Manager, stated the former owner would like to incorporate this property as part of a major rezoning on the west side of Farmers Branch. He stated staff has prepared notices for rezoning for Planning and Zoning consideration on August 12, and City Council consideration on August 19, 2002, which necessitates this item being on the agenda. Without action on this item the rezoning application would either have to carve out these two acres, or the City would be a co-applicant on the rezoning. Mr. Escalante stated at a meeting earlier in the day it was determined that it might not be possible for the rezoning to go forward at the Planning and Zoning Commission meeting of August 12, 2002 and subsequently on the City Council Meeting of August 19, 2002. He stated the urgency on this matter does not appear to be present. Mayor Pro Tern Bird asked if there were not any reasons why it cannot be approved. Mr. Escalante replied there are no reasons not to approve it at this time. There being no further discussion, a motion by Mayor Pro Tern Bird, second by Deputy Mayor Pro Tern Walden, all voting "aye," adopted Resolution No. 2002-097 conveying a Special Warranty Deed donated by the City of Farmers Branch back to Transcontinental Realty Investors, Inc., the initial Grantor. A.4 A motion by MI" Pro Tern Bird, seconded by Councilman Robbs all voting "aye," adjourned &4: .m. Cindee Peters, City Secretary Bob Phelps, Mayoil' Volume 89, page 27