LaSalle County finance committee members heard a staff presentation on a Section 125 cafeteria plan that would allow employees to tax-shelter benefit deductions while preserving the inclusion of those benefit amounts in Illinois Municipal Retirement Fund (IMRF) eligible wages.

The county's benefits staff member, Julie, told the committee: "Actually, we do still currently offer the section 1 25 plan to our employees. It allows them to tax shelter their benefit payments that are deducted from their gross wages on that given pay." Julie explained that while tax sheltering reduces employees' taxable wages, IMRF currently only recognizes the net reported wages for pension calculations unless the county passes a board resolution to treat the benefit-deduction amount as eligible wages.

Committee members pressed for documentation and for the item to return on a regular finance agenda. Julie said she would email the summary plan details and locate the prior resolution that authorized the practice. The committee discussed the estimated cost to the county: Julie said the county's accountant calculated an annual expense of about $15,000 tied to restoring IMRF credit for those benefit deductions for 24 employees currently sheltering pay.

Committee discussion emphasized two effects: employees who tax-shelter can see modest increases in take-home pay, while tax-sheltering can reduce the IMRF pensionable wage base unless the county treats sheltered benefit amounts as pensionable. One committee member noted some employees elect not to tax-shelter so IMRF captures their full earnings; Julie explained that passing a resolution would allow IMRF to consider the benefit-deduction amounts as eligible wages.

The committee did not take a formal vote on adopting a written plan; members asked staff to circulate the summary plan details and the prior resolution and to place the item on the next finance meeting agenda for formal consideration.

The committee also asked legal review and for staff to provide a written plan that could be approved or changed at a future meeting.

Additional context: the committee discussed that the $15,000 figure covers the whole group of 24 employees (not $15,000 per person) and that the estimate was presented on an annual basis to show potential recurring cost if the county opts to credit shelter amounts to IMRF.

Julie provided the documents to be circulated; the committee expects the item to return for formal action at the next scheduled finance meeting.