Treasury Recommendation Monroe County Road Commission OPEB Corrective Action Plan (CAP)

Non-Primary Unit 580100

Name of Systems

Type of System

Assets Liabilities Funded Ratio

ADC Revenues ADC/Revenue CAP required?

MERS Pension $21,172,824 $31,432,016 67.4% $809,440

$28,736,359

2.8% NO Monroe County Road Commission Retiree Health Care Plan

OPEB $2,999,315 $26,883,901 11.2% $1,973,766 6. 9% YES

Total $24,172,139 $58,315,917 $2,783,206 9.7% Source: Retirement Report 2017, Audited Financial Statements

Staff Recommendation: Approval of the OPEB corrective action plan submitted by Monroe County Road Commission, which was received by the Municipal Stability Board (the Board) on February 20, 2019 . If approved by the Board, Treasury and the Board will continue to monitor them for compliance per Public Act 202 of 2017 and implementation of their corrective action plan.

Changes Made:

• Modern Plan Design: o Vesting changed from 8 to 15 years for retiree-healthcare eligibility

• Plan Funding: o As of 1/1/2018, funding was increased to 30% of payroll, which is 11.9% more than the

ARC of 18%. • Other Considerations:

o Plan assets at 12/31/16 were $2,999,315 and have increased to $5,367,641 as of 9/30/18. Trust established in 2007 with a $100,000 deposit. Had assets of $589,660 by 12/31/13.

Prospective Changes:

• Modern Plan Design: o None Listed

• Plan Funding: o None Listed

• Other Considerations: o Newest acturial projections reflect additional contributions of $1,100,000 annually,

states the benefit system will reach 40% by 2023.

Plan size: members 141

• Inactive employees or beneficiaries currently receiving benefits: 65 • Inactive employees entitled to but not yet receiving benefits: N/A • Active employees: 76

Treasury Recommendation Monroe County Road Commission OPEB Corrective Action Plan (CAP)

Non-Primary Unit 580100

Corrective Action Plan Criteria:

The following corrective action plan approval criteria are met:

• Underfunded Status: o The corrective action plan demonstrates it will reach the PA 202 established funding

level of 40% funded as demonstrated by the internal analysis/actuarial projection/ actuarial valuation found in the corrective action plan.

• Reasonable Timeframe: o The corrective action plan demonstrates the local unit reaches the PA 202 established

funding level of 40% within a reasonable timeframe (2023).

• Legal and Feasible: o In section 7 of the corrective action plan template, the local unit confirms that the plan

is legal and feasible because the plan follows all applicable laws, the actions listed are feasible, and the plan is approved by the governing body.

• Affordable: o The local unit confirms in section 5 of the corrective action plan template that the

corrective actions listed will allow for the local unit to make, at a minimum, the retiree premium payment, as well as the normal cost payment for all new hires (if applicable) according to the long-term budget forecast.

Supplemental Information:

Using the provided GRS projection schedule, the Road Commission is projecting to reach 40% funded by fiscal year 2023. This projected schedule also demonstrates that the annual employer cost is scheduled to increase from $1.9 million in 2017 to over $2.7 million in 2023. This is an increase of 42%.

Treasury Recommendation Monroe County Road Commission OPEB Corrective Action Plan (CAP)

Non-Primary Unit 580100

The Community Engagement and Finance Division (CEFD) contact:

• None noted.

MINUTES OF THE BOARD OF COUNTY ROAD COMMISSIONERS

MONROE, MICHIGAN

February 25, 2019

1. At a Regular Meeting of the Board of County Road Commissioners at their offices located at

840 S. Telegraph Road, Monroe, Michigan on Monday, February 25, 2019 the meeting was

called to order by Chairman Iacoangeli at 5:30 p.m.

2. Roll Call by Deputy Clerk as follows:

PRESENT EXCUSED

Dan Minton Jack Thayer

Charles A. Londo

Greg W. Stewart

Paul Iacoangeli

A quorum being present, the Board proceeded to transact business.

3. Commissioner Iacoangeli led the Pledge of Allegiance.

4. Commissioner Iacoangeli led the Opening Prayer.

5. Commissioner Minton moved, seconded by Commissioner Stewart to approve the February

25, 2019 regular meeting agenda as presented. Vote: Ayes: 4 Nays: 0 Excused: 1 Motion

carried.

6. Public Comment – None.

7. The following items were listed on the Consent Agenda: (with immediate effect)

1) Approval of Minutes- February 11, 2019 Regular Meeting Minutes

2) Approval of Journal Entry

No.105 Vendor Checks #73690-73768 $ 299,819.20

Void Check #71136 $ 340.34

Void Check #71161 $ 185.37

Void Check #71164 $ 87.89

Void Check #71169 $ 137.45

No. 117 Payroll Checks #64372-64391 & Advice #25597-25687 $ 312,374.21

No. 135 Vendor Checks #73769-73808 $ 202,743.29

3) Township Contracts –

Exeter Township

Colf Sumpter to 6900’ East (Davis Drain) Crush&Shape/2”HMA

Colf E of Davis Drain to Carleton West 1.5” HMA

Colf Capernall to Rawsonville 1.5” HMA

Doty Scofield to S. Stony Creek Zone Patch/Single Seal

Fay Carleton West to Martinsville 1.5” HMA

Finzel Kane to North of N. Stony Creek Crush&Shape/2.25” HMA

Heiss Steffas to township line Single chip seal

Scofield Sumpter to East end of pavement Single chip seal

Steffas S. Stony Creek to Heiss Zone Patch/Single seal

Timbers S. Stony Creek to Stout Zone Patch/Single seal

2019 Local Road Mowing – Various

2019 Local Mow/Mulch – Various

4) Pulled for further discussion.

5) Mowing Contractor

Exeter Township Exeter Township

Monroe County Road Commission

Regular Meeting Minutes

February 25, 2019 – Page 2

Commissioner Minton moved, seconded by Commissioner Stewart to approve the February

25, 2019 Consent Agenda as presented, except for Item #4 which was pulled for further

discussion. Vote: Ayes: 4 Nays: 0 Excused: 1 Motion carried.

Commissioner Londo also indicated there was a correction to the minutes on Page 11 under

his comments. Ms. U’Ran already made that correction.

Item removed for further discussion:

4) Approve the Retirement and Benefits Act Corrective Action Plan and authorize the

Managing Director to sign on behalf of the MCRC.

Commissioner Minton asked if this plan was part of the annual statement to the State, and

part of the normal business for the funding of the retiree health care. Mr. Pierce explained

this is the corrective action plan that was submitted which requires a 40% funding level by a

date certain, and they required a Resolution showing the Board accepts the plan we

submitted. Commissioner Minton asked if this was the plan the legislature adopted. Mr.

Pierce indicated yes.

Ms. Hawkins-Freelain added that there are two separate filling requirements, and this is

different than the annual filing form Commissioner Minton referenced which is due by the

end of March.

Commissioner Stewart indicated he was pleased that the Road Commission was doing pretty

good toward the goal set in this plan, and added the MCRC has come a long way.

Commissioner Minton moved, seconded by Commissioner Stewart to Approve the Retirement

and Benefits Act and Corrective Action Plan and Resolution, and authorize the Managing

Director to sign on behalf of the Board. Vote: Ayes: 4 Nays: 0 Excused: 1 Motion

carried.

8. Unfinished Business – None.

9. New Business – None.

10. Report of Officers –

Randy Pierce (Managing Director) – Mr. Pierce had nothing additional to report.

Commissioner Londo reviewed topics in the Managing Director communication and

inquired what was next for Labo Road issue.

Mr. Pierce explained this section of road is a local road, and therefore, by law, the

Road Commission can only contribution 50% to any fix or improvement. This section

of road is concrete, and there has been several discussions with Ash Township

several times. The staff will continue to work with Ash Township to see if there is

interest if the project could be extended to west of the I275 overpass.

Commissioner Londo asked if the road has no funding why was the estimate

prepared, and it mentioned in his report. Mr. Pierce explained he was asked to look

into how much it would cost to perform work on this section of road since the Road

Commission’s NE Salt Facility is located on Labo close to Telegraph. He added that

the Road Commission will continue to work with the township on possible fixes and

funding.

Monroe County Road Commission

Regular Meeting Minutes

February 25, 2019 – Page 3

David M. Leach (Superintendent of Maintenance) – Mr. Leach informed the Board that

his department continues to work on finalizing township contract packages for 2019.

They are working on contractor estimates and bid packages for asphalt and emulsion

going out in late March. He also let the Board know that the MCRC would be hosting

the SE Council quarterly Superintendent’s meeting on March 4th

.

Matthew Snell (County Highway Engineer) – Mr. Snell advised the Board that the

Oxcart Transportation Permit system would be launched Friday, March 1, 2019. This

should add an extra level of customer service allowing customers to use credit cards

because we will be integrated with other SE counties using the program so they can

apply for permits in multiple counties at one time.

Mr. Snell also indicated the MCRC would be hosting the quarterly SE Council meeting

at the Road Commission on Monday, May 6th

.

Commissioner Minton indicated he understands Lenawee and Washtenaw County is

using this and can do business in multiple counties at one time. Mr. Snell indicated

yes, and explained each company will have their own account and log on to get their

move permits through Adrian and Monroe and not have to contact each individual

Road Commission.

Commissioner Stewart asked if there was a timeline on the new maps. Mr. Snell

indicated he didn’t have a specific date but would follow up on it.

Dori Hawkins-Freelain (Director of Finance) – Ms. Hawkins-Freelain added that the

Corrective Action Plan requires the MCRC to be 40% funded by 2023, but that still

leaves a sizeable unfunded balance.

Philip Costello (General Counsel) – Mr. Costello had nothing additional to report.

11. Public Comment –

David Hoffman, County Commissioner, suggested the maintenance Supervisors check on the

roads where the winds have been blowing sand into ditches and drains which may affect

drainage when things start thawing.

12. Commissioners' Comments -

Commissioner Thayer was excused.

Commissioner Stewart had nothing additional to report.

Commissioner Londo had nothing additional to report.

Commissioner Minton had nothing additional to report.

Commissioner Iacoangeli had nothing additional to report.

13. Adjournment -

Chairman Iacoangeli stated if there are no objections, the meeting is adjourned at 5:44 p.m.

Cheryl A. U’Ran _________________________________

Cheryl A. U’Ran, Deputy Clerk