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Mayor Robert E. Simison
City Council Members:
E IDIAN�~� Luke Cavener, President
Liz Strader,Vice President
I D A H O Brian Whitlock
Doug Taylor
John Overton
Anne Little Roberts
TO: Mayor Robert E. Simison
Members of the City Council
FROM: City of Meridian Employee Benefits Plan Trust (COMEBPT)
DATE: 6/6/25
SUBJECT: FY25 BUDGET AMENDMENT IN THE AMOUNT OF $1,124,335 FOR
SURPLUS FUNDING OF COMEBPT
REQUESTED COUNCIL DATE: 6/24/25
I. RECOMMENDED ACTION
A. Move to:
1. Approve the $1,124,335 additional funding for the Health Plan Trust to
provide an adequate surplus as defined by Idaho State Dept. of Insurance
(DOI) and to cover anticipated/projected additional claims costs for the
remainder of FY25.
2. Authorize the Mayor to sign the amendment
11. TRUST CONTACT PERSON(S)
Bill Nary 208-489-0480
Christena Barney 208-489-0465
III. DESCRIPTION
A. Backuound
In 2020 the City of Meridian chose to create a Self-Funded Trust to manage health
care benefits for its employees. This entity is responsible for administration and
funding of these employee benefits. Under the guidance of the State of Idaho
Department of Insurance, the Trust is required to ensure adequate funding is
available to conduct business, pay claims and maintain a minimum surplus level
of funding to ensure the natural ebbs and flows of claims costs can be covered by
the Trust. The amount of surplus required is outlined under Idaho Code, §41-
4010(3). This equates to three months of contributions for the current plan year,
or 110% of the difference between the total dollar aggregate stop-loss attachment
point plus costs of operation and the total dollar expected contributions for the
current year. Currently, the required surplus is $ 2,290,183.
B. Reason for Amendment
Due to higher than projected claims costs,the Trust surplus has dropped below the
required surplus minimum. In addition, given the current claims trends, the Trust
is experiencing a significant rise in claims. The Trust anticipates the need for
additional funding to ensure that as claims are paid out, the surplus remains at an
adequate level. As a reminder, the Trust operates on a calendar year basis. This
amendment is intended to focus on the funding needs for the remainder of the
City's fiscal year. It is the Trust's intention to keep the Council closely informed
of claim costs and further fiscal impacts to the Trust as we move forward through
the year ahead. The table below outlines the details around this request.
IV. IMPACT
A. Trust Funding Summary: Otr. 1 Statement
Balance Sheet:
Trust Balance Sheet Qtr. 1: Assets $2,219,108
Trust Balance Sheet Qtr. 1: Liabilities $2,219,108
Income•
Trust Qtr. 1 (Jan-Mar) Income $2,290,183
Trust Qtr. 1 (Jan-Mar)Expense $2,710,314
Net ($420,211)
Surplus Summary:
Surplus Balance: Beginning of Year $2,159,084
Surplus Balance: End of Qtr. 1 $1,740,108
Required Surplus $2,290,183
Surplus Shortfall: End of Qtr. 1 ($550,075)
Projected Supplemental Funding Needed:
Surplus Shortfall (6.48% over Contributions) $550,075
Projected Monthly Shortfall (Trend Data Only) $95,710
Represents 13.5% over contributions
Monthly Shortfall x 6 Months $574,260
Estimated Supplemental Funding Needed to
Maintain Adequate Surplus and Operating Costs $1,124,335
V. ALTERNATIVES
Public Works Department . 33 E. Broadway Avenue, Suite 200, Meridian, ID 83642
Phone 208-898-5500 . www.meridiancity.org
The Trust is required to file quarterly financial statements to the DOI. It is possible the
State could mandate action to correct a deficit in surplus if subsequent quarterly results
indicate a deficiency exists. However, there are alternatives available as follows:
A. The City could choose to not fund this request at this time.
a. This would require the Trust to request an amendment at a later date
to fund the full deficit amount to acquire adequate funding.
B. The City could choose to partially fund this request with what is needed to
reach the minimum surplus at end of Qtr. 1 ($550,075).
a. The implications of this may lead to an additional budget amendment
in the future to secure additional funding knowing the claims costs
are continuing to rise.
C. The City could choose to partially fund this request and stand firm in not
supporting any additional surplus funding.
a. The implications of this would require the Trust to shift the
remaining costs to the employees. The result of this potentially
impacts recruitment and retention.
Approved for Council Agenda:
Public Works Department . 33 E. Broadway Avenue, Suite 200, Meridian, ID 83642
Phone 208-898-5500 . www.meridiancity.org
Employee Benefit Costs Employee Benefits Plan Trust
Source:MIP Reports>Statement of Rev and Exp>GL Code between 42000 to 43040 $ 550,075
Fund Code Dept Code Department FY2024Actual(Audited) %Allocation Allocation Across Departments
01 1120 Council $ 106,462 0.35% $ 1,919
01 1140 City Clerk $ 194,438 0.64% $ 3,505
01 1310 Mayor's Office $ 175,502 0.58% $ 3,163
01 1500 Finance Department $ 428,781 1.41% $ 7,729
01 1510 Information Technology $ 608,535 1.99% $ 10,969
01 1520 Legal Dept $ 226,224 0.74% $ 4,078
01 1540 Human Resources $ 305,481 1.00% $ 5,506
01 1840 OtherGovt/St Lighting $ 127,487 0.42% $ 2,298
01 1850 City Hall $ 828,573 2.72% $ 14,935
01 1900 Community Development Depts $ 1,582,794 5.19% $ 28,530
01 2110 Police Department $ 10,176,703 33.35% $ 183,434
01 2210 Fire Department $ 8,121,058 26.61% $ 146,382
01 5200 Parks&Recreation $ 2,275,269 7.46% $ 41,012
60 3200 Public Works $ 1,490,238 4.88% $ 26,861
60 3300 Meridian Utility Billing $ 191,735 0.63% $ 3,456
62 3400 Water Department $ 1,512,880 4.96% $ 27,270
65 3500 WasteWater Facility $ 2,165,287 7.10% $ 39,029
Total Employee Benefit Costs $ 30,517,448 100.00% $ 550,075
General Fund 82% $ 453,459
Enterprise Fund 18% $ 96,616
F:\Budget\FY2025\FY2025 Amendments\Archived Copies\FY2025 Budget Amendment Form_HR_Health Benefits Trust Cost Allocation