COMMISSIONER AGENDAS & MINUTES
COMMISSIONERS SPECIAL MEETING
Commission Chairman, Percy L. Brown, Jr. called the meeting of the Hancock County Commissioners to order at 8:30 a.m. on Tuesday, April 28, 2015 in the conference room of the county courthouse located in Ellsworth, Maine with Commissioners Joy and Blasi in attendance.
MOTION: to approve the request to allow the chairman to sign the Federal Grant Application for the 2014 Pavement Remarking Project reimbursement grant. (Joy/Blasi 3-0, motion passed)
MOTION: to approve the request to allow the Chairman to sign the Federal Grant Application for the 2015 Crack Sealing, Pavement Repair, Pavement Marking, and PCN Analysis project. (Joy/Blasi 3-0, motion passed)
MOTION: to approve the snow removal agreement with the Town of Franklin for the Martin's Ridge Road in the amount of $4,000. (Joy/Blasi 3-0, motion passed) Discussion: This contract was formerly with City Line and increased by $5. Commissioner Joy was pleased with the move. Commissioner Blasi questioned paragraph 3-C regarding “winging,” this is part of the contract and is done on an as needed basis. Commissioner Blasi questioned the last part of paragraph 5 regarding fuel negotiation. This statement is included in the Town of Steuben and Penobscot County contracts; if fuel costs go above $5 per gallon the cost has to be renegotiated.
8:34 a.m.: Recess until 9:00 a.m.
Commissioner Brown called the meeting back into regular session at 8:59 a.m.
Scott McKee of Acadia Benefits was in attendance to discuss the “look-back” period and proposed Health Insurance Buy-Out language change. Mr. McKee stated that the Affordable Care Act (ACA) provides two opportunities for employers to determine whether someone is a full-time employee; this can be done monthly based on their actual hours for that particular month or by using a look back method. Employers will have to report to the IRS, at the end of 2015, whether employees were full-time based on one of the two definitions.
Currently, the County has been using the default of "monthly." Mr. McKee stated that if an employee is full-time benefits eligible this month, we put them on the benefits next month, if we hire someone new this month, we put them on the benefits next month. If someone is hired at 20 hours a week, they are not put on the benefit because they are only working 20 hours per week. Per a decision that was made, as a team, in 2014 we are using the monthly method for 2015 until a time comes in 2015 that we realize that the monthly method may open us up to penalties in 2016. To avoid any penalties, the County has to offer insurance to most of its employees; at this time "most" is defined as 70%. Hancock County currently offers health insurance to approximately 95% of employees. In January 2016 the definition changes and "most" is defined as 95% of full-time employees therefore, for January we have to confidently say that the monthly method is going to allow us to offer coverage to 95% of our full-time employees or we have to move to the look back method for January 1st. In the summer of 2015, county staff with the help of Acadia Benefits will look at 5 to 6 months of data using the monthly method to see how many months that the County will pass or fail. If we fail for one or two months, we will need to look at options to change our eligibility structure.
Commissioner Brown asked the question; how do you classify elected officials? Mr. McKee stated that the law allows you to use the monthly method for one set of employees and the look back method for another set of employees with strict guidelines; this may change in the future. Another method is salary vs. hourly; if it is determined that the look back method was needed for January 1st for all hourly employees, we do not have to do that for salaried employees which would include elected officials. Although he suggested obtaining a legal opinion to confirm, Mr. McKee stated that in his mind, the commissioners could say that all salaried employees were going to use the monthly method and all hourly employees would then use the look back method. In Mr. McKee's opinion, it does not make sense for salaried individuals, specifically elected officials to be tracking hours. It would be a burden on the county to start doing that.
Commissioner Brown stated that elected officials have traditionally not checked in or signed time sheets, the commissioners vote their own salaries and the salaries of the other elected officials, he stated that it was his understanding that they would have to start tracking their time and that sometimes that may be difficult due to their county commissioner related commitments throughout the state. Mr. McKee stated that as long as all salaried employees are treated the same, there is no other reason besides this to start tracking hours and that the commissioners may want to ask an attorney if elected officials can be treated differently from everyone else because it is not spelled out in the law as one of the things that we can differentiate. An easier solution that would not incur attorney fees would be to say “we are not going to track hours for any salaried folks, full-time salaried folks are eligible for the plan on the monthly method, hourly folks are eligible based on the look back method." We can do that today, we can do that January 1st without changing the process for elected officials. Mr. McKee stated that the commissioners might want to lump salaried employees in with elected officials as he was under the impression that salaried employees were not currently tracked. Commissioner Brown clarified that Time Track tracks certain salaried employees hours adding that the only positions that are not tracked are the Jail Administrator, Chief Deputy, EMA Director, County Administrator and Elected Officials. (Additional positions that are not tracked and were not mentioned are: Major, Patrol Deputies, SO Detective, Civil Process Supervisor and DA Detective.)
Commissioner Brown stated that signing in and out for exempt/salaried employees is in county policy. Mr. McKee stated that "you can track their hours but you don't necessarily have to." Personnel Coordinator DePrenger stated that clarification was needed because County Policy states that exempt employees must clock in and out with the exception of......but Mr. McKee said that you have to treat everybody the same, she clarified that she was not including elected officials in her question. Mr. McKee stated "you don't have to treat everybody the same, the ACA allows employers to treat different classes of employees differently." Examples given were union and non-union, salaried and hourly. Commissioner Brown stated that the four employees that are not punching in may need to use a time sheet. Mr. McKee reiterated that all the IRS cares about is whether the person is full-time for any given month, or not.
Commissioner Joy asked "isn't all they (the IRS) want to know is if they are offered health insurance?" Mr. McKee stated that "the County could offer part-time employees benefits, you can say the elected officials are part-time, or you can say you are salaried part-time, salaried full-time, it doesn't matter, nobody is going to ask about hours, the IRS is never going to ask how many hours, the hours are only used to determine whether somebody is benefit eligible but if you are benefit eligible through your contract, then there's no need to track your hours for the ACA." Commissioner Brown stated that we would not have to redefine what a part-time employee is adding that some people say that the commissioners and elected officials are part-time employees but the Statute only says that the Register of Deeds is the only one who has to work full-time. The commissioners do not have set hours but if they are called at midnight they have to respond. Mr. McKee stated that the ACA does not change that.
Commissioner Joy stated that there has been some confusion and that the commissioners were told that all exempt employees hours should be tracked. (meaning the complete number of hours worked by each exempt employee) Mr. McKee stated that we have to report who is eligible for the plan and if that person was not full-time, what the codes are trying to figure out is who is full-time that we are not offering coverage to. Commissioner Joy thought that this may be the Big Brother effect and that its intent was to track the exempt employee who is working 53 hours per week and then say "maybe you should hire another employee." Mr. McKee stated "you do not have to report the number of hours, but you may be audited. You may have to prove actual hours if you have an employee who goes out and qualifies for the Obama Care subsidy through the Exchange and they say you owe tax dollars, well that person wasn't full time, they are going to say, well that person told us they were full-time, let's see your files. That is what all of this is meant to do, none of it is meant to change the way you operate the entity." Commissioner Joy stated that if we have 70 employees who get benefits and 15 part-time, the part–time is where we are spending our time, the other 70 have the benefit already. The question is whether any of the 15 are going to trigger a penalty. A discussion followed regarding temporary full-time employees.
Mr. McKee stated that by using a scale of 100 employees and 95% coverage, we have to be sure that never, in any month, that we look back in 2016 that we have more than 5 people who are full-time in any given month and not offered benefits. Commissioner Joy questioned if we had a temporary full-time employee who worked 40 hours per week, but only worked that schedule for 6 months, what happens then? Mr. McKee stated that with the monthly method, there is no flexibility if someone works 131 hours in June, they are eligible in July or if you don't want them covered in July they can count as one of the 5, we don't have to offer them coverage but we can't have more than 5 to avoid a penalty. The other option is to use the look back method and we would measure that person over the course of a year and only then if they average over 130 hours a month over a year, then that would trigger benefits eligibility for the following year. We have two ways of dealing with that and depending on the study when we look back on the first 5 months of 2015, we will make a recommendation and the commissioners will make a decision whether to either utilize the monthly method or look back method for 2016.
Commissioner Brown stated that what we need to do now is identify the people who are working temporary full time and in the future we would have to make sure that we don't exceed the 5. Mr. McKee stated, yes you could just use the monthly method and just manage it so there is never more than 5, that is what some businesses are doing by only hiring part-time. You can limit people in this class to less than 130 hours or something that can be controlled to make sure that it never goes over 5 but you would have to control the entire employee population. Personnel Coordinator DePrenger stated that the situation is not necessarily for temporary full-time employees, sometimes part-time employees are hired with a caveat of "not to exceed 29 hours per week, annually." Mr. McKee stated that you can't have any more than 5 of those people without triggering a catastrophic penalty, the team here cannot go forward with any possibility that we are going to hit that 6th person in any month in 2016, it will trigger a huge penalty on top of paying for premium.
The strategy that will be presented this summer, after the look back study for 2015, is going to be conservative. Commissioner Brown stated that most temporary employees work in that jail, this may present a union issue if you can't use that person temporary full-time, this is how they got by the union issue before when they would use a part-time person when the full-time employees have bumping rights. Mr. McKee stated that it is probable that they are going to initiate a look back method for determining eligibility for our hourly employees; the same may be applied to salaried employees as well but possibly not, it is the only way to ensure that we will never have (inaudible). Commissioner Joy questioned if the look back method lets you average or is the trigger the 5 people? The answer was no, that is the monthly method. Acadia Benefits will be write a policy where the procedure is that we will never have one, the hourly employees will all be subject to the look back method and we will have 100% compliance. Commissioner Brown stated that he assumed that as soon as possible, we would want to identify who we have in that status.
Commissioner Joy presented a “compelled” shift scenario that he thought may trigger an issue. Mr. McKee stated that with the look back method they would use 12 months x's 52 weeks, the threshold is 1530 hours per year. If you manage it to 1500 and a person goes over 1530 hours, we offer that person benefits. A policy will be put into place to screen people to make sure they are in benefit compliance. Commissioner Joy questioned what would be done if we have a full-time employee who is old enough for Medicare or are on their spouses policy; the answer was that we have to offer them benefits, they would decline coverage and it (proof of declined of coverage) would be tracked.
Commissioner Joy stated that he was disappointed because he was expecting changes this year from our federal representatives to increase part-time to something above 29 hours. Commissioner Joy has observed that nursing homes have "hordes" of 29 hour employees who also work at different places due to their 29 hour status. Mr. McKee stated that a Supreme Court decision may be the next trigger. Mr. McKee will be back sometime in July or August for another discussion and a possible recommendation to initiate a look back period. Commissioner Joy stated that he is now ready to take a harder look at our health insurance options. Commissioner Brown stated that he was not opposed to looking at Obama Care. Mr. McKee stated that up to 100 employees would be able to look at the Exchange for health insurance which is not driven by an experience ratio. Other options include MMEHT, Meritain, Northern New England Benefit Trust and the Exchange. Cost data could be provided for union negotiations.
Regarding the Health Insurance Buy-Out/Buy-down, currently there is a small loophole that allows some employees based on their income to waive county coverage and receive subsidized coverage from the Exchange. We would like to close that loophole because you don't want to give someone a stipend (HI Buy-out) and trigger a penalty for the county because that person is getting subsidized coverage from the Exchange. There are two ways of closing the loophole, 1) would be to say "if your other coverage is subsidized coverage from the Exchange, you don't get the stipend (HI Buy-out). 2) would be to increase the minimum wage up to a place where our plan is affordable for everyone. Currently, there 5 employees that make an hourly rate that does not qualify as affordable based on the Safe Harbor, that number is $14.04 for non union employees and $14.74 for union employees. This would not affect employees who utilize veterans insurance; it only affects the person taking Obama coverage, because it incurs a $2,000 penalty for us. With regard to contacting the employee who is currently utilizing the Exchange, the date and how to communicate this should be communicated clearly. Currently we have 5 employees whose wages are not considered affordable under the ACA. The employee health insurance contribution could be lowered for these people to meet the affordability criteria.
MOTION: to enter into executive session under MRSA Title 1 §405 6(a) to conduct an exempt employee evaluation. (Joy/Blasi 3-0, motion passed)
Commissioner Brown called the meeting back into regular session at 10:25 a.m. with nothing to report.
MOTION: to adjourn. (Joy/Brown 3-0, motion passed)