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Home My WebLink About11 DOMESTIC PARTNER 09-07-04 Finance Director 11 £ AGENDA REPORT Agenda Item Reviewed: City Manager MEETING DATE: JUNE 7, 2004 TO: WilLIAM A. HUSTON, CITY MANAGER FROM: HUMAN RESOURCES DEPARTMENT SUBJECT: IMPLEMENTATION OF REQUIREMENTS PURSUANT TO AB 205 AND SECTION 297.5 OF THE CALIFORNIA FAMilY CODE - DOMESTIC PARTNER POLICY EFFECTIVE JANUARY 1, 2005 SUMMARY: Effective January 1, 2005, pursuant to AB 205 and Section 297.5 of the California Family Code, the City is required to provide the same rights, protections and benefits to qualified domestic partners of City employees as are provided to the spouse of an employee. Adoption of the attached policy will enable qualified domestic partners of City employees to the same rights, protections and benefits as are provided to a spouse of a City employee, and such individuals shall be subject to the same responsibilities, obligations, and duties under law, that are granted to and imposed upon spouses. To be eligible for benefits (Le. medical, dental, vision, increased flex dollars and life insurance), the domestic partnership must be registered with the Secretary of State. Eligibility is limited to same-sex domestic partners over the age of 18 and opposite-sex domestic partners, one of which is age 62 or older. RECOMMENDATION: Adopt the attached Domestic Partner Policy, to be effective January 1, 2005, and enable enrollment for and provision of benefit coverage for domestic partners of employees during the upcoming open enrollment period beginning September 15, 2004. FISCAL IMPACT: Estimated to be approximately $3,500 for fiscal year 2004/2005. BACKGROUND AND DISCUSSION: The City does not currently provide benefits, rights and/or such other privileges as are offered to spouses of our employees, to a domestic partner of an employee. Effective January 1, 2005 the City is required to make those health benefits, rights and privileges that are available to married couples available to qualified domestic partners of employees. City Council Agenda September 7, 2004 Page 2 To be eligible, State law requires that persons over the age of 18 of a same-sex domestic partnership, as well as opposite-sex domestic partners, one of which is age 62 or older, to register non-marital relationships with the Secretary of State. Having obtained registration of the relationship, the law allows the registered individuals to invoke the same rights and privileges as a married couple as allowed under Section 297.5 of the California Family Code (Le. medical, dental, vision, increased flex dollars and life insurance). The attached policy will be effective January 1, 2005; however adoption of the policy will enable the City to allow employees to enroll eligible domestic partners during open enrollment beginning September 15, 2004. ~lb~ Arlene Marks Gibbs, SPHR Director of Human Resources Attachments: City of Tustin's Domestic Partner Policy S:\City Council Agenda Items\2004\Domestic Partner Final.doc DOMESTIC PARTNER POLICY PURPOSE Pursuant to State Law, this policy will allow qualified domestic partners of City employees to invoke the same rights, protections and benefits as a married couple. BACKGROUND Effective January 1, 2005, AB 205 allows persons of same-sex domestic partners over the age of 18, as well as opposite-sex domestic partners, one of which is age 62 or older, to register non-marital relationships with the Secretary of State. Having obtained registration of the relationship, the law allows the registered individuals to invoke rights and privileges under Section 297.5 of the California Family Code. This enables a registered domestic partner of an employee the same benefits as those available to a spouse and/or dependents of an employee. This includes, but is not limited to programs such as life insurance, Employee Assistance Program (EAP), medical, dental and vision plans, increased flexible spending dollars toward health expenses and continued coverage through COBRA. DOMESTIC PARTNERS DEFINED Pursuant to Section 297 of the California Family Code: Domestic partners are two adults who have chosen to share one another's lives in an intimate and committed relationship of mutual caring. A domestic partnership shall be established in California when either: . Both persons are members of the same sex; or . In the case of opposite sex domestic partnership, one or both of the persons must be over the age of 62 and meet the eligibility criteria under Title II of the Social Security Act. In addition they must meet the following requirements: . Each partner is least age 18, and mentally competent to enter a contract. . Not married to or legally separated, or have not had another domestic partner within the prior 12 months (with the exception of the death of a partner). . Not related by blood: parent, sibling, niece, nephew, aunt, uncle, grandparent, grandchild, or other blood relationship that would prohibit marriage under California Law. . Jointly responsible for each other's basic living expensed incurred during the domestic partnership. S:\Policy Guidelines\Domestic Partners\Domestic Partners Policy.doc Page1of3 This coverage can only be extended to domestic partners as defined by in Section 297 of the California Family Code. Additionally, coverage is extended to children or legal dependents of domestic partner as defined by IRC section 152(a). VERIFICATION OF DOMESTIC PARNTERSHIP In order to verify the existence of a domestic partnership, the City of Tustin will require: . A copy of a Declaration of Domestic Partnership registered with the Secretary of State (Family Code Section 298). Additional supporting documentation of domestic partnership may be required if CalPERS deems appropriate, such as: . CalPERS Statement of Financial Liability for Domestic Partner Health Benefit. TAXATION OF DOMESTIC PARTNERS BENEFITS A domestic partner as defined by the law does not usually meet the definition of a dependent as defined by Internal Revenue Code Section 152(a), or a spouse as defined in Public Law 104-199. Currently, the fair market value of domestic partner benefits will be treated as imputed income and subject to taxes. Consequently, the City of Tustin is required to withhold applicable taxes for those employees with a Declaration of Domestic Partnership on file in the Human Resources Department unless the domestic partner meets the IRS requirements to qualify as a dependent. In addition, if a child and/or dependent of the domestic partner (who would not otherwise be IRC Section 152 dependent) are added to the employee's benefits, the City of Tustin is required to calculate the cost of adding them to the plan as taxable income to the employee. EXEMPTIONS FROM TAXATION If the domestic partner of the employee meets the definition of a dependent under the Internal Revenue regulations, the City is not required to withhold payroll taxes. If this is the case, the employee must complete a CalPERS Affidavit of Eligibility for Economically Dependent Children. TERMINATION OF DOMESTIC PARTNERSHIP Pursuant to Section 299 of the California Family Code, a member of a domestic partnership may end said relationship by filing a Termination of Domestic Partnership with the Secretary of State in order to establish the actual date of termination of the domestic partnership. Employees who terminate a domestic partnership must submit a copy of the Termination of Domestic Partnership to Human Resources within thirty (30) days of the termination. S:\Policy GuidelineslDomestic PartnerslDomestic Partners Policy.doc Page 2 01 3 Please note: If the City, any health care provider, or other person suffers due to a false statements or failure to notify the City of changed circumstances as required by the State of California., The entity or person may bring a civil action to recover their losses, including reasonable attorney' fees. Attachments: Copy of the Declaration of Domestic Partners Copy of Termination of Domestic Partners Disclaimer: Benefits, benefits plans, domestic partner benefits, premiums, costs and procedures are subject to change. It is the employees' responsibility to verify any information that you need to be properly informed or to make a decision concerning domestic partner benefits. Information contained in this document and/or provided by a City representative on legal or tax issues is not intended as legal or tax advice and should not be relied upon. Employees should consult with a financial consultant, tax advisor, or legal advisor for tax, financial or legal advice before taking action. In the event of any conflict between the City's domestic partner benefits and relevant legal requirements, the legal requirements will prevail. S:\Policy GuidelineslDomestic PartnerslDomestic Partners Policy.doc Page 3 013 State of California Bill Jones Secretary of State FILE NO: ------------------- DECLARATION OF DOMESTIC PARTNERSHIP (Family Code Section 298) Instructions: 1. Complete and mall to: Secretary 01 State, P.O. Box 944225, Sacramento, CA 94244-2250 (916) 653-4984 2. Include filing lee of $10.00. Make check payable to Secretary 01 State. We the undersigned, do declare that we meet the requirements of Section 297 at this time: (Office Use Only) We share a common residence; We agree to be jointly responsible for each other's basic living expenses incurred during our domestic partnership; Neither of us is married or a member of another domestic partnership; We are not related by blood in a way that would prevent us from being married to each other in this state; We are both at least 18 years of age; We are both members of the same sex or onelor both of us is/are over the age of 62 and meet the eligibility criteria under Title II of the Social Security Act as defined in 42 U.S.C. Section 402(a} for old-age insurance benefits or Title XVI of the Social Security Act as defined in 42 U.S.C Section 1381 for aged individuals; We are both capable of consenting to the domestic partnership; Neither of us has previously filed a Declaration of Domestic Partnership with the Secretary of State pursuant to Division 2.5 of the Family Code that has not been terminated under Section 299 of the Family Code. The representations herein are true, correct and contain no material omissions of fact to our best knowledge and belief. Sign and print complete name. (If not printed legibly, application will be rejected.) Signatures of both partners must be notarized. ---------- ----------------- --------------------------------------- -- Signature (Last) (First) (Middle) --------------------- ------ --------------------------------- ----------- Signature (Last) (First) (Middle) Cõlnmõï,Rã5iaëñëãAd-dress------------------cTiy-----------------Šïãië-----------ZijJCoae ------------------------------------------------------------------------------ Maiiing Address City State Zip Code NOTARIZATION IS REQUIRED State of California County of ------------------------ On , before me, , personally appeared personaily known to me (or proved to me on the basis of satislactory evidence) to be the person(s} whose name(s) are subscribed to the within instrument and acknowiedged to me that helshelthey executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s} executed the instrument. s¡gñã¡U;¡¡-õfÑOìãïy-Pübiië------------- ---------- [PLACE NOTARY SEAL HERE] SEC/STATE LP/SF DP-1 (Rev 11/2001) State of California Bill Jones Secretary of State FILE NO: ------------- NOTICE OF TERMINATION OF DOMESTIC PARTNERSHIP (Family Code Section 299) Instructions: 1. Complete and send by CERTIRED mail to: Secretary of State P.O. Box 944225 Sacramento, CA 94244.2250 (916) 653.4984 (Office Use Only) 2. The,e Is no fee for filing this Notice ofTermination I, the undersigned, do declare that: Former Partner: and I are no longer Domestic Partners. (Last) (First) (Middle) Secretary of State File Number: If termination is caused by death or marriage of the domestic partner please indicate the date of the death or the marriage: (month/day/year) This date shall be the actual termination date for the Domestic Partnership as provided in Family Code Section 299. ------------------------------- ---------------------------------------------- Signature (Last) (First) (Middle) ---------------------------------------------------------------------------------- Mailing Address City State Zip Code NOTARIZATION IS REQUIRED State of Caiilornia County of ------------------------ On , before me, , personally appeared personally known to me (or proved to me on the basis 01 satisfactory evidence) to be the person whose name is subscribed to the within instrument and acknowledged to me that he/she executed the same in his/her authorized capacity, and that by his/her signature on the instrument the person executed the instrument. Signature of Notary Public [PLACE NOTARY SEAL HERE] SECISTATE LP/SF DP-2 (Dee 1999)