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SR-8-C (43).~ • r PE:persl.bancroft.pms Council Meeting: January 12, 1993 TO: Mayor and City Council FROM: City Staff ~C s~~?!~~ ~ ~ 1~~3 Santa Monica, California SUBJECT: Recommendation to Adopt Resolution af Intention and Introduce an Ordinance to Amend Contract Between the Public Employees' Retirement System and the City of Santa Moni.ca INTRODUCTION This report requests that City Council adopt the attached Resolution stating its intent ta approve an amendment to the contract between the Pub~ic Emplayee's Retirement system (PERS) and the City af Santa Monica to pravide Section 20818 (Two-Years Additional Service Credit) for local miscel~ane~us and safety members. This report also requests that the City Cnuncil introduce for fi.rst reading an ordinance which would amend the City's PERS contract. DISCUSSION The City of Santa Monica contracts with PERS to provide a retirement plan for its permanent employees. As a contracting agency, the City may amend its cantract to provide various optiona~ benefits offered by PERS. In iight of our current budgetary situation, the City i.s reviewing various options which, if 1 ~ ~ 1:!': 4 _ ~.'lh+ ~ r',• ~ ~ I~J.7 . implemEnted, would result in a reduction in its operational expenses. The use of early r~tirement incentives is one such option available to the City. Section 20818 (Two-Years Additional Service Credit) would pranide two years additional sErvice credit to members who reta.re during a designated period if a mandatory transfer, iayof€, or demotion is imminent due to budgetary reductions. Consistent with PERS guidelines, the City would determine which job classifications would be e~igible for this optional benefit and designate the period during which this benefit would be offered. The designated period must be subsequent to the date of the amendment to the PERS contract and cannot be less than 90 days nor more than 180 days in length. In ord~r to abtain the two years additional service credit with PERS, an employee in one of the eligible job classificatians designated by the City must have at least five years serva.ce credit, be in employment status with the City for at least one day during the designatEd periad, be at least 50 years old and retire during the designated period. To meet the criteria of the Government Code authorizing this amendment, perrnanent vacancies within the C~ty mtzst be maintained as a result af emplayees retiring with the two years additional service credit. The City is canducting a survey ta determine potential employee interest in a two-year additional service credit benefit. This data will enable staff to determine if the two-year additional 2 [ service credit aption wouZd be beneficial to both the City and potential retirees. A survey of cities comparable to the City of Santa Monica indicates that CulvEr City, Pasadena and Burbank have amended their contract with PERS to include the two-year additional service credit option. BUDGET/FINANCIAL IMPACT The maximum one-time cost of this benef~t will range from 31~ to 63% af one year's salary for each emplayee who retires, with th~ exact percentage dependant upan the age and sex of the emp~oyee. The value to the City is the greater salary savings which would be obtained as a resu~t of keeping a pasition vacant. RECOMMENDATION It is recommended that City Cauncil: 1) Adopt the attached Resolution indicating its intent to approve an amendment to the contract between the Public E7mployees' Retirement 5ystem and the City of Santa Monica to provide Section 20818 (Two-Years Additional Service Credit) for local misceZlaneous and safety members; and 2) Introduce an ordinance to amend said contract as indicated. Prepared by: Kar~n Bancroft, Director af Personnel 3 Attachments: Reso~ution of Intentian to amend contract between the Public Employees' Retirement System and the City of Santa Monica Ordinance amending contract between the Public Employees' Retirement System and the City of 5anta Monica ~ RESOLIITION NO. 8~24 (CCS] (City Council series) RSSOLIITION OF INTENTION TO APPRdv~ AH AMENDMEl~'I' TO CONTRACT BEiw~EN THE BOARD DF ADMINIBTRATION QF THE PUBLIC EMPLOYEES~ RETIREMENT SYSTEM AND THE CITY COUNCYL OF THE CITY OF $AI1TA M021ICA WHEREAS, the Public EmpZoyees' Retirement Law perfnits the participatian af pubZic agencies and their employees in the Public Employees' Retirement System by the execution of a contract, and sets farth the procedure by which said public agancies may elect to subject themselves and their employees to a~aendments to said Law; and WHEREAS, one of the steps ~n the procedures to amend ~his cantract is the adoptian by the governing body of the public agency of a resolution giving notice of its intention to approve an amendment to said contract, which resolution shall contain a summary of the change proposed in said contract; and WHEREAS, the folZowing is a statement of the proposed change: To provide Section 20818 (Two-Years Additional Service Credit) for local miscellaneous members and loca~ safety members. THE CITY COUNCIL OF THE CYTY OF SANTA MONICA DOES RESOLV~ AS FOLLOWS: SECTION 1. Notice is hereby given of the intent of the City Caunci~ of the City of San~a Manica to approve an amendment to the contract between the said governing body and the Board of Administratian ~f the Public EmpZoyees' Ret~rement System, a copy af said amendment being attached hereto, as an "Eschibit" and by this reference made a part hereof. SECTION 2. The City Clerk shall certify to the adoption af this Resalution and thenceforth and thereaft~r the same shall be in full forc~ and effect. Adopted and approved this I2th day of January , 1993. _ ~~~~~ C %~ C~P.P/~' ~ APPROVED AS TO FORM: J SEpH L~WRENCE cting City Attorney Adopted and approved this 12th day of January, 1993. ~ ~~~ ~~ ' Mayor ~ hereby certify that the foregoing Reso].ution No. 8524(CCS) was duiy adopted by the City Council of the City of Santa Monica at a meeting th~reof held ort January 12, 1993 by the following council vate: Ayes: Noes: Councilmembers: Abdo, Genser, Greenberg, Ho~brook, Olsen, Rosenstein, Vazquez Councilmembers: None Abstain: Councilmembers: Nane Absent: Councilmembers: None ATTEST: .y ///1~P'~ ~/LS/ y1~,~-+'~"_ `J ~ '"~City Cler~ ` ~~~ ~ ~~i ~~V1~ Ly~{~~ V~4~ AMENDMENT TO CONTRACT COPY B~:i'WEEN THE BOARD OF ADMINISTRATION OF THE PUBLIC E~17PLOYEES' Rr:11REMENT SYSTEM AND Tf~E CITY COUNCIL OF TI~ Cl'1'Y OF SAN'TA M4IVICA The Board of Adininistratlan, Public Enaployees' Retirement System, hereinafter refened to as Board, and the governing body of above public agency, hereinafter referre~ to as Public Agency, having entered into a contract effective ]uly 1, 1944, and witnessed April 5, 1944, and as ameaded effeccive March 1, 1950, September 1, 1951, June 1, 1954, November 1, i96(l, February 1, 1962, September 12, 1965, November 1, 1969, November 25, 1973, January 20, 1974, March 3, ~974, June 28, 1981, May 13, 1984 and 7anuary 1, 1992, which provides for participat~on of Public Agency in said System, Board and Public Agency hereby agree as follows A. Paragraphs 1 through 12 are hereby stricken from said contract as executed effective January 1, 1992, and hereby replaceti by the following paragraphs numbered 1 through 12 inclusive: 1. All wards and terms used herein which are defined in the Public Employees' Retirement Law s~al1 have rhe meaning as defined therein unless otherwise specifically provided. "Nomnal retuement age" sha~l mean age 60 for local miscellaneaus members, age SU for local fire and local police members, and age SS fvr ocean beach lifeguards. 2 Public Agency shall participate in the Public Employees' Itetuement System from and after 7uly 1, 1944 makmg ics employees as hereinafter provide~, members flf said System subject to al1 provisions of the Pvblic Emplayees' Retirement Law except such as apply only on e~ection of a contractmg agency and are not prov~ded for herein and to all amendments to said Law hereafter enacted except those, which by express provisions thereof, apply only on the election of a c~ntracting agency. 3 Emplayees of Public Agency in the follawing classes shall become members of said Retirement Sys~em except such in each such c~ass as are excluded by law or this agreement• a. Local Fire Fighters {herein referred to as local safety members); b. Local Police Offcers (herein referred to as ~ocal safety members); Ocean Beach Lifeguards (mcluded as local safety members); d Em~loyees other than Iocal safety members (herem referred to as loca~ miscellaneous members) a5 so i:s2•w~ -- . ..._. .- - -- . . _._ _ . _ . _.. .... . _ ._ _ .._ - -- - ..~~r~c[~ c~ci_ . "'- _ -- . _ . _ ~ ~ lrw~~J/ 2J"Sn 23'wE ~~.L\r~~J 1 . _ _ . __ ,_ ., ._ ~ - ._. .~ _._ ._,. _ ._ -._ . .. . - -- • - ~ -- ..~...,,._.. . __._..^ --- - - - - ~.,..,,...-•-~- -~ -- ~--- -----~--~ - -~- - _-..--- - ,-- j" -- CS ~ _~ _, .,..,_ .__S.j'J~.~~iOCJ~~~~_,.;-.~ .,_.=`~4y S.~_.~_,__.. _ ~.,SS,oN CL ---'-----"'- r: ~ c~~ ~C PAt~'~h+i4:iV~ ~~ ~ ) ~ a,~ ?_ can ~ gu t t er ~~,~i~r`~ ~_-- 4,.,.. }..~,OV~'Ft18QCf cV~ ~ (~ °~-'~~ -'~' r , - -t ~ ~ - ~ -- - Ga~~#1._$a~~~. 1 _... __ .~ .w_._. _._~F~Sa- J ,~' r'--.. 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X • x . s =- _~_.___ ~ - ~_ - - i9~.~7' .. __ _ _ ~ -~3.i'4~i'S9"~, s~~'ea~~'~> ~ y~~•~ Canc 535'39'00'~~ 1'~7•5~ 245.96' . ~ ~ --- Rad ~`f ~ i} ~ f ~'4d I ~~ i I ~ ~ ~ ~ ~ ~ c ~[c~ry ~lucCp - Residence ~P ~ ~ ~ ~i r7 ~-----^- r ~ i tr ±~ ~l~ ~ or;~ ~ Myj~ r v- U~~ i 1Mot~r N~if~r 1~t 17f ~ r R ._1.., --- ~~ - - -~ r~ __ r_.~ _~ i .m i . i ~ 4 ~ ~ I , ~ I ~ ~~ ~ ~ ~ ~ ~ ~ ~ i w z E a ,~ i N i ill ~. ~ W + ~ ~ ~ ~ CA:jld645/hpc/pc City Counci~ M~eting 1-12-93 Santa Monica, California ORD~NANCE NUMBER (City Council S~riES) AN ORDTNANCE OF THE CITY COUNCIL ~F THE CITY OF SANTA MONICA AMENDING THE C~NTRACT BETLdEEN TH~ CITY COUNCTL OF THE CITY OF SANTA MON~CA AND THE BOARD O~' AbMTNISTRATION OF THE CAI,IFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM NOLJ, THEREFOR~, THE CITY COUNCYL a~' TH~ CITY OF SANTA MONICA DOES ORDAIN AS FOLL06dS: SECTION 1. That an ar~endment ta the contract between the City Counci~ of the City of Santa P~Ionica and the Board of Administrat~on, Califarnia Ptzblic Employees' Retirement System is hereby author~zed, a copy of said amendment being attached hereto, marked Exhibit, and by such ref~rence made a part hereof as though herein set out in full. SECTION 2. The City Manager is hereby authorized, empowered, and directed to execute said amendment for and on behalf of ~he City. SECTION 3. Any provision of the Santa Monica Municipal Code or appendic~s thereto inconsistent with the provis~ans of this Ordinance, to the exten~. of such incansistencies and no further, are her~by repealed or r~Qdified ta that ext~nt necessary to affect the provisions af this Ordinance. - ~ - SECTIDN 4. ~f any section, subsec~ion, sentence, cZause, or phrase of this Ordinanc~ is for any reason held to be invalid or unconstitutionaZ by a decision af any court of any campetent jurisdictzon, such decision shall not affect the validity af the remaining p~rtions of this Ordinance. The City Council hereby declares that it would have passed ~his Ordinance, and each and every section, subsec~ion, sentence, c~ause, or phrase not declared invalid or unconstitutional without regard to whether any partion of the Drd~nance ~aauld be subsequently declared invalid or unconstitut~onal. SECTION 5. The Mayor shall sign and the City Clerk shall attest to the passage of ~his Ordinance. The City Clerk shall cause the same to be published once in ~he officia~ newspaper within 15 days after its adoptian. This Ordinance shall become effective after 30 days from its adoption. APPROVED AS TO FORM: J E LA ~TREI~CE A ting City Attorney _ 2 _ ~~ 0 ~t~ ~`~ ,~~ '~~ ~~ ~~ ~.~t? AMENDhZENT TO CONTRACT ~op~ BETWEEN THE BDARD OF ADMINiSTRATION OF 1'I~ PUBLIC EhiPLQYEES' RETIREMENT SYSTEM AND THE CTTY COUNCIL OF THE CITY OF SANTA MDIVICA The Baard of Admimstration, Public Employees' Retirement System, hereinafter referred to as Board, and the gavernmg body of abave public agency, heremafter referred to as Public Agency, having entered into a contract effective July 1, 1944, and witnessed Aprii 5, 1944, and as amended effective March 1, 1950, Sep~ember 1, 1951, 7une 1, 1954, Navember l, 196U, February 1, 1962, September 12, 1965, November 1, 1969, Navember 25, 1973, January 20, 1974, March 3, I974, June 28, 1981, May 13, 1984 and January 1, 1992, ~vhich gravades for partic~pation of Public Agency in saFd 5yscem, Board and Pvblic Agency hereby agree as follows A Paragraphs 1 through 12 are hereby stricken from said contract as executed effecti~e January 1, 1992, and hereby replaced by the foll~wing paragraphs numbered 1 through 12 inclusi~e: 1. Aii words and terms used herein which are defined in the Public Employees' Retirement Law shail ha~e the meaning as defined therem uniess otherwise specifica~ly pro~ided. "Normal retirement age" shall mean age 64 for local miscellaneous members, age 50 for local fire and local police members, and age SS for ocean beach lifeguards 2. Public Agency shaIl participate in the Public Employees' Retirement System ftom and after JuIy 1, 1944 makmg its empioyees as hereinafter provided, members of said SyStem subject to all provisions vf the Public Employees' Retirement Law except such as apply only on election of a contractmg agency and are not pro~ided for herein and to all amendments to said Law hereafter enacted except those, which by express provisions thereof, apply only on the election of a contracting agency. 3. Employees of Public Agency m the following classes shall become members of said Retirement System except such in each such class as are excluded by law or this agreement a Local Fire Fighters (herein referre~i to as lacal safety members}; b Lacal Police Officers (herem referred ta as local safety members), c. Ocean Beach Lifeguards (included as local safety members}; d Employees other than local safety members (herein referred to as local misce~laneous members} ~~~~~ ~~ ~;UT St~~ "~~Bn QNt'~" 4 In addition to the classes af employees exct~deil €ro;n membership by said Retirement Law, the follvwing classes of employees shall not become members of said Retirement System: NO ADDITIONAL EXCLUSIONS 5. The percentage of fina! compensation to be pro~ided for each year of creditad prior and current service as a local miscellanenus member shall be determined in accordance with Section 21251 13 of sa~d Ret~rement Law (2 % at age bQ Full) 6. The percentage Of fina~ carnpensation to be pro~ided for each year of crediteii prior and current ser~~ce as an ocean beach lifeguard shall be determined m accordance witli Section 21252.1 af sa~d Retirement Law (One-ha~f pay at age 55 FuII}. 7. The percentage of final campensation to be provided for each year of credited priar and current service as a Iocal police member and tocal fire member shall be determined in aecordance with Section 21252 O1 of sa~d Retirement Law (2% at age 54 Full}. Public Agency elected to be sub~ect to the foliow~ng optional pravisions: a Sect~an 20019.3 ("Local Safety Member" shall include ocean beach lifeguards of a crty as describecl in Governrnent Code Sectian 20019 3). b. Sections 2i380-21387 (1959 Survivor Benefits} excluding Sectian 21382.2 (Increased 1959 Svrvivor Benefits} and Section 213$2 4(Third LeveI of 1959 Sur~i~or Benefts) c. Section 21222 1(Special 5~ Increase - 1970}. Leg~s~ation repealed said Section effective January 1, 1980. d. Sections 212b3 and 21263 1(Post-Retirement 5urvivor Allowance) for local ~re members and lacal police members anly. e. Sect~on 20024.2 (One-Year F~nal Compensation) for local fire members and locai police members only f Section 2Q930 3(Military Service Credit as Public Service), Statutes of 1976. g Section 20818 {Two-Years Addit~onal Service Credit). 9. Public Agency shaIl contribute to said Retirament System the contributions determtned by actuarial valuations of ~r1or and future ser~ice liability with respect to local miscellaneous members and local safety members of said Retirement System 1Q Public Agency sha~l aiso contribute to said Retirement System as foliows. a. A reasonable amount, as fixed by the Bvard, payabie in one installment within 60 days af date of contract to cover the c~sts of administering said Systezn as it affects the employees of Public Agency, not mcluding the costs of special ~aluations or af the per~od~c i~vestigation and valuat~ons required by law. b. A reasonable amount, as fixed by the Boarc~, payable in one instaliment as the occasions arise, to cover the costs of speciai valuations on account of employees of Public Agency, and costs of the period~e in^estigation and valuations requ~red by law. 11 Cantributions required of Public Agency and its employees shall be subject to adjustment by Board on account of amendments to the Public Employees' Retirement Law, and nn account of the experience under the Retzrement System as determined by the periodic mvestigation and valuat-an required by said Retirsment Law 12. Contributians required of Public Agency and its employees shal[ be paid by Public Agency ta the Retirement System w~thin fifteen days after the end of the period to which said contributions refer ar as may be prescribed by Board regulatian. If more or less than the correct amount of contriburions is paid for any period, proper adjustment shall be made in connection with subsequent rernittances Ad~ustments on account of errors in contributions requireil af any employee may be made by d~rect payments between the employee and the Board B Th~s amendment shall be effective on the day of , 1~ BOARD OF ADMINISTRATION ('~~ PUBLIC EMPLOYEES' RETIREME~3'YSTEM @ ~~ BY ~ CHIEF, CONTRACT SER S DIVISION PUBLIC EMPLOYEES' I~~REMENT SYSTEM ,~o CITY COUNCIL OF THE CITY OF SANTA MONICA ~ BY C1~ Pres~dmg O~cer ~ ~ ~Ci ~ Wirness Date ~~' ~ ~ ,~ a ,b-rt~r: ~ c~ ~w Clerk ~~` ~~ PERS-CON-702 (AMENDMENT) (Rev 1192}