Title
Human Resources Department, Risk Management Division, recommending the Board approve and authorize the Chair to sign a budget transfer increasing revenues and appropriations in the Health Fund by $2,000,000 and increasing use of contingency and appropriations in the Liability Fund by $340,000. (4/5 vote required)
FUNDING: Health Fund and Liability Fund.
Body
DISCUSSION / BACKGROUND
The El Dorado County’s Health Fund (org 0930000) was established to pay employee health premiums and is funded through employee payroll deductions and departmental contributions. Increased costs are due to a combination of actual rate increases and differing employee benefit selections than anticipated. The recommended budget transfer will ensure the Health Fund can continue to pay monthly health premium invoices. The increased costs will be offset by employee payroll deductions and contributions from County departments.
The Liability Program (org 0900000 and 0910000) is funded through cost-applied charges to County departments and supports operations, loss control, and the payment of litigation and settlement costs. Several significant liability claims have been in active litigation in recent years, and as these cases conclude, the Liability Fund must cover associated expenses. The proposed budget transfer will allow the fund to continue meeting these obligations, with increased costs to be recovered in next year’s General Liability rate development.
In order to account for these increased costs, the proposed budget transfer increases both appropriations and revenues under the Health Fund and increases appropriations under the Liability Fund with the use of contingency. Finally, the transfer also includes reallocations between Human Resources and Risk Management expenditure categories based on projected expenditures.
ALTERNATIVES
Should the Board opt not to approve the enclosed budget transfer, both the Health Fund and Liability Fund would experience inadequate appropriations.
PRIOR BOARD ACTION
N/A
OTHER DEPARTMENT / AGENCY INVOLVEMENT
N/A
CAO RECOMMENDATION / COMMENTS
Approve as recommended.
FINANCIAL IMPACT
There is no direct impact to the General Fund as the Risk programs are internal service funds. The use of contingency of the General Liability fund will draw funds from the actuarial reserve.
CLERK OF THE BOARD FOLLOW UP ACTIONS
Upon Board approval, Clerk of the Board to obtain Board Chair signature on the attached Budget Transfer and forward to the Auditor’s Office for final processing.
STRATEGIC PLAN COMPONENT
N/A
CONTACT
Joseph Carruesco, Director of Human Resources