Discussion and possible action to approve a transfer of budget appropriation from the Insurance Reserve fund contingency account to the Self-Insured Employee Benefits Trust fund and the Self-Insured Workers’ Compensation fund providing authority to record additional claim expenditures that were not anticipated when the original Fiscal Year 2018 budget was developed.

The City of Peoria provides a medical benefit plan to provide health coverage for employees and their eligible spouse/dependents. The City self-insures its health benefits program including establishing appropriate reserves to address claim costs. The Employee Benefits Trust fund covers the cost of medical claims.

In addition to the health benefits provided, the City of Peoria also provides a workers’ compensation program to provide for employee work related injury and illness claims. The City self-insures its workers’ compensation program including establishing appropriate reserves to address claim costs. The workers’ compensation program covers the cost of medical claims for the injured worker as well as lost wages.

Based on several months of high claims activity, it is anticipated that the claims expenditures in the self-insured Employee Benefits Trust fund and the self-insured Workers' Compensation Trust fund will exceed the FY 2018 budget by approximately $1,683,000.

In FY 2014 City Council approved a budget amendment in the amount of $133,220 to cover required year end accounting entries to properly record claim expenditures and liabilities, based on the annual actuarial report.

A: That the City Council approve a FY 2018 budget amendment of $1,683,000 to cover the anticipated claims for FY 18 Employee Benefits Trust fund and the anticipated claim expenditures and liabilities in the self-insured Workers' Compensation Trust fund.

B: That the City Council not approve a FY 2018 budget amendment of $1,683,000 to cover the anticipated claims for FY 18 Employee Benefits Trust fund and the anticipated claim expenditures and liabilities in the self-insured Workers' Compensation Trust fund.

That the City Council approve a FY 2018 budget amendment of $1,683,000 to cover the anticipated claims for FY 18 Employee Benefits Trust fund and the anticipated claim expenditures and liabilities in the self-insured Workers' Compensation Trust fund.

The budget transfer will be made from the Insurance Reserve contingency account 3200-3610-570000 to Self-Insured Workers’ Compensation Trust Fund claims account 3210-3620-523018 $333,000 and Employee Benefits Trust Fund claims account 3220-3630-523019 $1,350,000.

The approximate self-insured Employee Benefits Trust fund year-end liability anticipated is $16,854,600. This amount is $1,350,000 higher than the anticipated in the FY 18 budget.

The approximate self-insured Workers' Compensation Trust fund year-end liability anticipated is $1,782,600. This amount is $333,000 higher than the anticipated in the FY 18 budget.

In order have the appropriate funds available to pay the anticipated claims, an additional $1,683,000 budget appropriation is required. The funds are available in the reserves of the Self-Insured Employee Benefits Trust fund.