SR-602-003
f:\person:misc/council\counci38 Santa Monica, California
Council Meeting: September 14, 1999
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Recommendation to Adopt Resolution of Intention to Amend Contract
Between the California Public Employees' Retirement System and the City
of Santa Monica to Amend the Survivor Benefit Option for Local
Miscellaneous Members and to Authorize the City Manager to Execute the
Agreement to Pool 1959 Survivor Benefits Assets and Liabilities Between
the Board of Administration of the Public Employees? Retirement System and
the City Council of the City of Santa Monica and to Hold a Public Hearing
and First Reading of an Ordinance to Amend Said Contract as Indicated
INTRODUCTION
This report requests that Council adopt the attached resolution stating its intent to approve
an amendment to the contract between the California Public Employees? Retirement
System (CalPERS) and the City of Santa Monica to provide Section 21573 Third Level of
1959 Survivor Benefits for local miscellaneous members. This report also requests that
the City Council authorize the City Manager to execute the agreement to pool 1959
survivor benefits assets and liabilities between the Board of Administration of the Public
Employees? Retirement System and the City Council of the City of Santa Monica. The
attached resolution and agreement comply with the procedure required by CalPERS . This
report also requests that on September 14, 1999 there be a public hearing and first
reading of an ordinance which would amend said contract as indicated. The ordinance is
also attached.
DISCUSSION
The City of Santa Monica contracts with CalPERS to provide a retirement plan for its
permanent safety (police and fire) and miscellaneous (non-safety) employees. As a
contracting agency, the City may amend its contract(s) to provide various optional benefits
offered by CalPERS.
The 1959 Survivor Benefit option is an additional CalPERS benefit which contracting
agencies can offer to employees who are not covered by Social Security. The 1959
Survivor Benefit option is modeled after the Social Security program in that it provides a
monthly benefit to the families of CalPERS members who die prior to retirement.
As Social Security benefits improved over the years, CalPERS has modified the 1959
Survivor Benefit option by providing additional benefit levels. The Third Level provides a
higher monthly payment to the CalPERS member?s family than that which is provided by
the basic program.
As a part of the most recent Memorandum of Understanding (MOU) negotiated between
the City of Santa Monica and the Municipal Employees Association, the City agreed to
amend its contract with CalPERS to provide Section 21573 Third Level of 1959 Survivor
Benefits. Doing so requires that the benefit apply to all local miscellaneous members,
which includes all non-safety City employees.
BUDGET/FISCAL IMPACT
The cost to the employee for this benefit is $2.00 per month, the same as the current cost
for the basic 1959 Survivor Benefit program. The employer cost is based on a large
experience pool rather than the experience of the City alone and may vary from year to
year. For the current year, there is no cost to the employer for this benefit.
RECOMMENDATION
It is recommended that the City Council authorize the City Manager to execute the
attached Agreement to pool 1959 survivor benefits assets and liabilities between the
Board of Administration of CalPERS and the City Council of the City of Santa Monica and
to adopt the attached resolution indicating its intent to approve an amendment to the
contract between CalPERS and the City of Santa Monica to provide Section 21573 Level
Three of 1959 Survivor Benefits for local miscellaneous members. It is further
recommended that on September 14, 1999 there be a first reading of the Ordinance to
amend said contract.
Prepared By: Karen Bancroft, Director of Personnel
Attachments: Resolution of Intention
Agreement to Pool 1959 Survivor Benefits Assets and Liabilities
Ordinance Authorizing an Amendment to the CalPERS Contract