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County board approves resolution to change IMRF reportable wages to include certain pre-tax benefits
Summary
The board passed a resolution to calculate IMRF (retirement) reportable wages on gross wages rather than net-of-IRC Section 125 health premiums, a change staff said will modestly increase retirement credits for employees and slightly raise county IMRF costs.
The Lee County board approved a resolution instructing that compensation paid under an IRC Section 125 plan (employee-paid health insurance premiums) be included in IMRF reportable wages, changing the calculation base from net-of-premiums to gross wages for affected employees.
Finance Director Reid Acree explained the change as correcting a long-standing quirk in IMRF wage calculation that reduced pensionable earnings for employees who pay health premiums through payroll deductions. County staff said the effect would be modest on an individual basis (an increase in retirement credit and a small increase in employer IMRF contributions) and that the FY26 budget includes the additional cost.
Nancy Naylor moved the resolution; Maya Kitson seconded. With no further questions, the board voted in favor and the motion carried. Staff and board members framed the change as a retention and benefit improvement for employees, and noted it will increase county pension liabilities slightly going forward.
Ending: The board directed that the approved resolution be forwarded for inclusion on the county board agenda and recorded for implementation in payroll/IMRF reporting.
