St. Charles considering health savings plan for firefighters
St. Charles is working to set up a retiree health savings plan for the city's firefighters.
At last week's City Council Government Operations Committee meeting, aldermen unanimously recommended establishing a retirement health savings plan for the St. Charles Professional Firefighter's Association IAFF Local 3322, which represents the city's firefighters.
The recommendation will now go to the full city council for review. Jennifer McMahon, the city's director of human resources, said the city and the union agreed to meet and bargain in good faith to establish the specific terms and conditions for a retiree health savings plan.
"One of the reasons that the union is interested in this is simply because a lot of times, based on how their pensions are structured, they retire at a younger age," she said. "So this type of plan allows them to set aside dollars and have those dollars invested tax free and then have those distributions after retirement pay for things like health insurance premiums or deductibles or co-pay. The benefit is that the dollars put into the trust lower the employee's taxable income (providing tax savings for the city as well)."
There is no cost to the city, McMahon said.
"The contribution comes from their paycheck and their vacation and sick time payout," McMahon said in response to a question by 2nd Ward Alderman Rita Payleitner. "There is no reporting that the city has to do. We simply have to deduct the money and send the funds over to the financial institution. And that's something we're already doing, actually, on the police side, so there's minimal impact in terms of administrative function."