Council approves deferred compensation plan for elected officials; city officials clarify cost and vesting

The Hialeah City Council approved on second reading an ordinance to establish a deferred compensation plan for elected officials that mirrors options available to other city employees.

Staff and council discussed the plan’s parameters in detail. The finance director (Ruth Ruby, Finance Management) said the plan is modest compared with retirement benefits in other jurisdictions. City and legal staff emphasized the plan is not a defined‑benefit pension and contains no retroactive payments. Council members asked for clarification about vesting, matching contributions and cost to the city. Staff said council members would be eligible to contribute up to 7% of salary; the city would match up to 7%, but employer contributions would vest only after five years of continuous service. If a member leaves before five years, they keep their own contributions but not the city match for the unvested period.

City officials estimated the total annual city contribution for all seven council members at roughly $21,000 per year (combined), which staff characterized during the meeting as a modest expenditure and not a “golden parachute.” The ordinance was approved by voice/roll call vote.

Key points clarified at the meeting: - The plan is a deferred compensation plan (similar to a 457), not a defined‑benefit pension; contributions accumulate and are portable only for amounts the member contributed or that are vested. - Vesting occurs after five continuous years in office; contributions are prospective only (no retroactive pay for prior service). - The plan would be administered by the city’s existing deferred compensation administrator.

The ordinance was approved on second reading; staff will proceed with plan setup and provide participating elected officials with enrollment information and administrative timelines.