City of Milwaukee - File #: R13424

• File #: R13424
• Version: 0
• Type: Housing Authority Resolution
• Status: Passed
• File created: 10/5/2023
• In control: HOUSING AUTHORITY
• On agenda: 10/11/2023
• Final action: 11/8/2023
• Title: Resolution authorizing the Housing Authority of the City of Milwaukee (HACM) to institute a defined contribution 401(k) plan for all employees hired on or after January 1, 2024, rather than join the Wisconsin Retirement System at this time.
• Sponsors: THE CHAIR

Date	Ver.	Action By	Action	Result	Tally
11/8/2023	0	HOUSING AUTHORITY	ADOPTED; Minutes note: Patricia Dee, HACM’s Administrative Services Supervisor, explained that Fernando Aniban, HACM’s Assistant Secretary, and Julie Wilson, Assistant City Attorney, would present items R13424 and R13427 which are mutually-exclusive resolutions related to Wisconsin Act 12 and retirement contributions for HACM employees and that Commissioners would then most likely vote for one, but would not vote for both of the resolutions. Staff provided a brief background summary and answered the Commissioner’s questions about the documents provided with the agenda.	Pass	3:0
11/2/2023	0	HOUSING AUTHORITY	HELD IN COMMISSION; Minutes note: Staff provided a brief background summary and answered the Commissioner's questions about the documents provided with the agenda. Julie Wilson, Assistant City Attorney noted that the title of resolution R13424 mistakenly stated to opt out of the City’s pension plan rather than the State’s pension plan. As the discussion continued, it was noted that resolutions R13424 and R13427 were not included in correspondence to the Commissioners before the meeting. Due to the error in the resolution title and the Commissioners requesting additional time to review the resolution language, it was decided that the resolutions would be Held in Commission until the regularly scheduled November HACM Board meeting for further discussion.	Pass	4:0
10/11/2023	0	HOUSING AUTHORITY	HELD IN COMMISSION; Minutes note: Patricia Dee explained that Fernando Aniban, HACM’s Assistant Secretary, Crystal Reed-Hardy, Chief Human Resources Officer, and Julie Wilson, Assistant City Attorney would present an informative summary regarding the next two mutually-exclusive resolutions related to Wisconsin Act 12 and retirement contributions for HACM employees and that Commissioners would then most likely vote for one, but could not vote for both of the following resolutions. Attorney Wilson stated that the legislation will affect new HACM hires on and after January 1, 2024. She explained that one of the requirements in Act 12 stated that if the City of Milwaukee voted to pass the 2% city sales tax, that one of the conditions would be that the City’s pension system would close to new employees at the end of the same year the tax was passed and that going forward new City employees would be enrolled in the State’s Wisconsin Retirement System (WRS). For entities like HACM, separate from the City, but currently enrolled in the City’s pension plan, they may elect to join WRS, or they may elect to provide some other retirement plan, but the entity must choose one or the other option, as the City’s pension fund will be closing to new employees. If WRS would be selected, there is work staff must do before a November 15th WRS deadline. Fernando Aniban stated that staff recommends adoption of the 401(k) retirement benefits option for all new HACM employees hired on or after January 1, 2024. He explained that the WRS employee contribution would be 6.9%, whereas the employee contribution for the plan currently offered for employees of HACM’s subsidiary organizations, Travaux and Crucible, would be 5%. The Commissioners asked questions about the options. They requested more information comparing the total costs of the options, the number of new employees added in 2024, and the next three to five years, differences in employee’s rights to opt in or opt out, and what penalties and fees exist.	Pass	4:0

Number

13424

Version

Revised JPW Edit 11/02/2023

Reference

R13424 originally introduced at the October 11, 2023 HACM Board meeting, however held over for special meeting on November 2, 2023. 

Sponsor

The Chair

Title

Resolution authorizing the Housing Authority of the City of Milwaukee (HACM) to institute a defined contribution 401(k) plan for all employees hired on or after January 1, 2024, rather than join the Wisconsin Retirement System at this time.

Body

WHEREAS, By operation of 2023 Wisconsin Act 12 (Act 12) and action by the City of Milwaukee to pass a sales tax in 2023, the City of Milwaukee Employees’ Retirement System (CMERS) will close this year. Employees hired by the City or HACM on or before December 31, 2023 will remain covered by CMERS.  All benefits and obligations under that system continue; 

WHEREAS, The City is required to act to join the State of Wisconsin’s pension system known as the Wisconsin Retirement System (WRS) for employees hired on or after January 1, 2024.  However, per Act 12, that mandate does not apply to HACM;

WHEREAS, If HACM does not wish to join WRS at this time, it may explore other options such as a 401(k) defined contribution plan applicable to employees hired by HACM on or after January 1, 2024; and

WHEREAS, HACM has explored the cost-benefit of the options therefore, be it:

RESOLVED, by the Commissioners of the Housing Authority of the City of Milwaukee that HACM institute a defined contribution 401(k) plan for all HACM employees hired on or after January 1, 2024, rather than join the WRS at this time. 

FURTHER RESOLVED, that the Secretary-Executive Director is directed to authorize the appropriate staff to take all action necessary to implement this Resolution, including making applicable changes to the HACM Employee Handbook.

Requestor

Drafter

Housing Management, Crystal Reed-Hardy, HR Director, 10/5/2023 Original/ Edit by ACA Julie Wilson 11/2/2023