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ARDEN HILLS CITY COUNCIL WORK SESSION – DECEMBER 21, 2020 12 Public Works Director/City Engineer Blomstrom stated this could be done if all MSA requirements were being met. Councilmember Holden questioned how long it would take the City to complete this project with Alternative 2. Public Works Director/City Engineer Blomstrom estimated the project would take eight to twelve weeks to complete. Staff will investigate creative solutions that may include break away bollards, pavement markings and rumble strips in order to create a pedestrian solution without adding significant costs to the project. City Administrator Perrault requested Item G be discussed prior to Item F. G. Accrual Payouts Upon Employee Separation City Administrator Perrault stated the City’s current policy surrounding the payout of accrued Paid Time Off (PTO), Flex Time, and Comp Time is that any accrued time shall be converted to cash and paid directly into an employee’s Health Care Savings Plan (HCSP). These payouts are capped at their respective maximums in the Personnel Policy at 240 hours for PTO, 40 hours for Comp Time, and 80 hours for Flex Time. The HCSP is limited in scope and can only be used for reimbursement of medical expenses following the separation from public service. As a result, an employee leaving the City can only use their respective payouts from accrued balances for medical related expenses. This does not give the employee much flexibility in-terms of access to those dollars, and restricts access to funds if needed for other purposes. It is believed this policy was originally implemented as a tool to save the City from paying employer taxes on high leave balances. The Council may want to consider amending its policy and allow for either a direct payment to employees of accrued balances and/or giving employees the option of a payout upon separation into a deferred compensation account. This would result in employer taxes when an employee separates, but the effect is not significant to the budget. While it varies from city to city, the trend for cities is to offer some form of payout to the employee and not deposit funds into an HCSP account. City Administrator Perrault reported any changes to the current model need to be approved by HCSP, but if Council is supportive staff will work on getting language to Council for approval at their first meeting in January. Any contradicting language in the Union contract would supersede an update to the Personnel Policy for Union employees, but changes to the contract could be considered in 2021 as it is a negotiation year for the contract. Councilmember Holden stated she served on the Personnel Committee when this was done. She explained the committee was not thinking of just retired personnel when the health savings plan was created. She indicated she supported the accrual payouts remaining as is. Councilmember Holmes questioned if City employees have an HCSP and an HSA. City Administrator Perrault reported this was the case. He commented further on the differences between the accounts held by union and non-union employees.