SR-106-023-02 (9)
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RP:DTA:BMC
Council Meet-~~ng:
San~a Mon~ca, Cal~fornla
April 9, 1985
IO-A.
TO:
Mayor and C~ty Councll
AfR 0 9 1985
FROM: Cornmisslon on Older Americans
SUBJECT: Recomrnendatlon of The Commlss1on on Older Americans ~o
favor the passage of Congresslonal Bl11s H. Res. 31 and
H. Con. Res. 39.
Introduction
ThlS repor~ transmlts a recommendatlon of ~he Commlssion On Older
Amer~cans ~o favor the passage of Congress~onal Bllls H. Res. 31
and H. Con. Res. 39, WhlCh are efforts to Clrcumvent the drlve to
freeze Soclal Securlty.
(See a~tached).
Background
The Commlss~on on Older Awerlcans met ~n regular seSS10n on March
20, 1985. At thls meetlng, Congresslonal Bllls H. Res. 31 and H.
Con. Res. 39 were present~d to the Commlsslon, and dlScusslon was
held.
Based on thlS dlScusslon, the followlng motlon was made:
CommlSSloner Dan Cohen moved that the Comrulss1on on Older Amerl-
cans go on record favoring the passage of the two bllls, H. Res.
31 and H. Con. Res. 39 and ask ~he Clty Councl1 to send resolu-
tlons to Congress in favor of them.
The motlon was seconded by
CommlSSloner Herman Cohen and carrled unanlmously.
The lntent of H. Res. 31 is that no changes can be enacted 1n
current law that would reduce or delay cost-of-liv~ng adJustments
for beneflclarles under the Soclal Securl~Y Ac~.
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APR 0 9 1985
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The 1ntent of H. Con Res. 39 1S that no law should be enacted
Wh1Ch would, 1) lncrease the costs to be 1ncurred by
benef1ciarles under t1tle XVIII and t1tle XIX of the Soc1al
Security Act, or 2) make more restrlctlve the requ1rements for
elig1bll1ty to rece1ve benef1ts under such t1tles.
Resolut1ons convey the "sense" or collective preference of the
leg1slatlve body Wh1Ch 16 pass1ng the resolut1on.
Bllls are 1n-
tended leg1slatlon and would become law upon passage.
PREPARED BY: Donald T. Arnett, Dlrector
Recreatlon and Parks
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RESOLUTiON
E:-..pressing thl' sen~c ot the Home of Hepl'pi"l.1ltatlH''': tlwl J~O
changes be en.lctf'd to current la\\ \\'lllt h would heezp Ubt-
of-living ,alJustments for bendicIJw'''J uuder the Social Sp-
curit,- Ac't.
\\l1Creas more than t\vo-rhirds of tht' ~<lflon's -.:elllUI ~ <1('f)(' 1](1
upon benl'iits under the Sotial SNunty Act a~ tlwir pI mmry
means of wpport;
\\l1ereas current prOjections show tlla t the f.:oc:iJ.1 3ecllnty rptlrl'-
ment and disability trust funds win Jl'l'l UP a.verage ~urpluses
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tot:d :;r;g ifhJre ~ h:m S ");1 j H1tJ. rJCO, 000 per ,'ear [tlrollg-hout
th,., 1 f';;;t or tbi;:: century,
\\'~i(ln'tl~ (hangt..., in the la" rIuring the last C'flngH'''''' have al-
read.'T J.f'laycrl annna.l cost-of-liying adjustn:enls tor b~nefjc;-
}~.rl('S under the Social Security Ar[ from ..T uly t.o .hm:ar}'.
alia
\Yh'rea- fl (me-Year freeze on t.he cO'it-of-livmg <:djmtment for
b'ndit'i.'Hjf~ nnder the Social Security ,A.l t coulll p.!'-it an
:H!~Jtinnal ,;00.000 or mOT:':' srninrs into PO\ ('fry X 0" .
th('rdore, be It
t f?,-:)I)ll'f'd. TInt It u the seEse of tho: Hou>;;(' Of Ihprp-
-) ~rnt.'[iH"o th,lt no ,'h:I~lge"5 bp f'un.f'trd jll current la..x 111:lt
:: '\'oldd rcrImp or d{+:y to:;;t-()f.linJ1l.~ .Idju....tment;; lor [}f :ldlt'i-
4 an::'~ llTIOf[ tllf' ~(,L'I.j 1 See'f1t" Act
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!)9TH ('O~(1RES~ H CON R"S 39
1ST :-;?,"!o,IO~
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J: "pre~-"]I1:!' tl:t "'f'n~(' of the ('onJ;rr<~ th,lt no la,'. ...hould lw rlUl h'd ,,\ hie h \\ ould
n'..tnn l'llg:lJI/oty, or mUt'J.~r costs Illcurreti b,: thl' rlderl,: ,jJ,d l'oor, f{Jj"
~[elhlart' ..ind 11(til('~l1d
IX THE IIOUSE OF REPRESE~TATrYES
.fAJ\TARY ~4-, 1fj~5
~fr G.mK'l.J. (for bm~dl. ~\Ir \YA~DIA~, ,)Ir STARK, ~fr PrI'?EE, :lIr
SCPEI'ER, .\-Ir BIAGG[, 1fr \',~ElSS. 3fr ItODll\O, }.Ir ~\:>iDn/:-,(l"', :.11
T()\\ ';" :\lr I\' A \;"JOl1SKf, Mr ~IIXETA. ~\lr R.em, \Ir SOLARZ, Mr COY"E.
Mr H..A.\\"KI~S. ~1r R.\.HALL. MT MITCHELL,:\1r ApPLEGATE, ~ln, COI.-
I 1:'\''', ~.fs ~11KrLSKI. Mr BOXER of TeIlIle~~-el'. Yr I,EVI.:q,: of Cl1hfomla,
:\h t\.APTrR, :\fr FRAKK, 11r LOWRY of Wu,hll1gwn, Mr TORRICELLl,
}fr Wf HIm. :\Ir MI Rl'HY. ~Ir Ik'>T.nIA~Tr.;, Mr Fl.'~TEH, ~fr OBFI~-
s'rA?, JIr OWEKQ. and 'fr STOKE'll, ~lihnlltt('d the follo\\Hlll;' j'OJ1currrnt
n'So~lltlfln. ,,'hleh 'N,lS referrt'd Jomtly to tf-t., Cf)ilHmttet'~ on \\"a\., and ~kal'~
and 1 'O!cr,lQ' and Commerce
CONCURRENT RESOLUTION
Expressing the sense of the Congress that no law should be
enacted ,vhich would restrid eligibility, or inerpase costs
incurred by the elderly and poor, for ~fedicare and .MedIc-
aid.
"nereas the 'Nation's elderly and poor depend h8fi:nly on the
Medicare and Medicaid (title XVIll and title XL\: of the
Social Security Act, respectively) for financial support for
needed health care;
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\Vhereas during the past 4 years Jledicare and MedicaId benefit
cuts and health care cost inflation have greatly increased
the financial burden on the Nation's elderly and poor;
"\\'hereas it is projected that our Nation's elderly "\vill use more
than 18 percent of their income for health care by 1989-
one-fifth more than before Medicare and Medicaid \vere en-
acted in 1965;
'Thereas the 20th anniyersary of the enactment of Medicare and
MedIcaid is a particularly inappropriate occasion upon which
to enact legIslation which would increase health care costs
to the elderly and poor; and
\\nereas further benefit cuts III ~ledicare and MediCaid would
unfairly burden the elderly and poor and limit their access
to needed health care: Now, therefore, be it
1 Resolved by the House of Representatwes (the Senate
2 concurring), That it is the sense of the Congress that no law
3 should be enacted which would-
4 (1) increase the costs to be incurred by benefici-
5 aries under title XVIII and title XIX of the Social Se-
6 curity Act, or
7 (2) make mOfe restrictIve the requirements for eli-
8 gibility to receive benefits under such titles.
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."I'fIII '4 III
99TH COKGRESS
1ST SESSIOX
H. R. 161
to ' ,{;y~ ~ (1)v;~-:
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JjJJV: ~J)/I/IJ lJ-' (T:;ytvv-.. cer..~ 'JJJ# ' l .
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To amend tItles II and X'"lll of the Soctal Secunt:- Act to remove the operatIons
of the soclal secunty trust funds from the umited budget of the (" nited
States, and to authonze the appomtment of two addJtlOnal trustees to the
boards of trustees of such trust fund;:;
IK THE HOUSE OF REPRESEXTATIVES
JAl>LJARY 3, 1985
Ms OAKA.R mtroduced the follo\\1ng bIll. whleh was referred Jomtly to the
CommIttees on Ways and Means and Energy and Commerce
A BILL
To
amend titles II and XVIII of the Social Securitv Act to
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remove the operations of the social security trust funds from
the unified budget of the United States, and to authorize
the appointment of two addItional trustees to the boards of
trustees of such trust funds.
1
Be it enacted by the Senate and House of Representa-
2 til;es of the United States of Amerzca in Congress assembled,
3 SHORT TITLE
4 SECTION 1. This Act may be cited as the "Social Secu-
5 rity Trust Funds Management Act of 1985"
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1 RE3IOYAL OF TReST FLTXD OPERATIONS FRO:\! THE
2 U~IFIED BUDGET
3 SEC. :2 (a) Section 201 of the Social Security Act (re-
4 latmg to the Federal Old-Age and Sun'ivors Insurance Trust
5 Fund and the Federal Disability Insllrance Trust Fund) is
6 amended by adding at the end thereof t.he follo\vmg new sub-
7 sectIOn:
8 a{m) The receipts anf. disbursements of the Federal OId-
9 Age and Survivors Insurance Trust Fund and the Federal
10 Disability Insurance Trust Fund and the taxes imposed under
11 sections 1401(a), 3101(a), and 3111(a) of the Internal Reve-
12 nue Code of 1954 shall not be mcluded in the totals of the
13 budget of the L"uited States Goyernment as submitted by the
14 President and as adopted by the Congress and shall be
lD exempt from any general budget. limitation imposed by stat-
16 ute on expenditures and net lending (budget outlays) of the
17 United States Government.".
18 (b) Section 1817 of such Act (relating to the Federal
19 Hospital Insurance Trust Fund) is amended. by adding at th0
20 end thereof the follo,.nng new subsection:
21 "(k) The receipts and disburseI!1ents of the Trust Fund
22 and the taxes imposed under sections 1401{b), 3101(b\ and
23 3111(b) of the Internal Revenue Code of 195-1 shall not be
24 included ill the totals of the budget of the UmteJ States Gov-
25 ernment as submitted by the President and as adopted by the
HI 161 m
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1 Congress and shall be ex.empt from any general budget limi-
2 tation imposed by statute on expenditures and net lendmg
3 (budget outla.ys) of tht: Umted States Government.".
4 (c) Section 1841 of such Act (relating to the Federal
5 Supplementary Medical Insurance Trust Fund) is amended
6 by adding at the end thereof the follo\ving new subsection:
7 "~) The receIpts and disbursements of the Trust Fund
8 shall not be included in the totals of the budget of the United
9 States Government as submitted by the President and as
10 adopted by the Congress and shall be exempt from any gen-
II era} budget limitation imposed by statute on expenditures and
12 net lending (budget outlays) of the United States Govern-
13 ment,".
1'f: (d) Th(, amendments made by this sectIOn shall apply
15 '\'\'Ith respect to fiscal years begInning on or after October 1,
16 1986, except that such amendment shall apply with respect
17 to the fiscal year beginning on October 1, 1985, to the extent
18 it relates to the budget of the United States Government as
19 adop~ed by the Congress and any general budget limitahon
20 imposed by statute on expendItures and net lending (budget
21 outlays) of the Vnited States Government.
22 APPOINT:1IENT OF A.DDITIOXAL TRUSTEES TO THE BOARDS
23 OF TRU~TEES OF THE TRuST FUNDS
24 SEC. 3. (a) Section 201(c) of the Social Security Act is
25 ar~lended-
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HI 161 IH
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(1) by inserting "(I)" after H(cf';
(2) by redesignating paragraphs (1) through (5) as
subparagraphs (A) through (E), respectively;
(3) by striking out "in paragraph (2) above" and
inserting in lieu thereof "in subparagraph (B)";
(4) by striking out "the Secretary of Health, Edu-
cation, and WeHare, all ex officio" and inserting in lieu
thereof "the Secretary of Health and Human Services,
all ex officio, and hvo indivIduals appointed by the
President, bv and ",-jth the advice and consent of the
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Senate, in accordance wIth paragraph (2)"; and
(5) by adding at the end thereof the follO\\;n6' new
paragraph:
"(2)(A) The President shall appoint, by and with the
15. advice and consent of the Senate, two individuals to be mem-
16 bers of the Board of Trustees for terms of four years, except
17 that, of the individuals first appointed, one shall serve for a
18 term of 1\\'0 years, as designa.ted by the President at the time
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19 of appointment. The tVIo'O individuals shall be chosen on the
20 bas~~ of their experience, integrIty, impa.rtIa.lity, and good
21 judgment, wi.thout reference to political affiliatIOns and solely
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22 on the ground of fItness to perform the duties of the office
23 1l(B) Vacancies occurring in the positions for which ap-
24 pointments are authorized under subparagraph (A) shall be
25 filled in the same manner as original appointments, and any
DR 161 Ii
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1 mdividual so appointed shall serve out the unexpired term of
2 his predecessor.
3 "(C) Each indindual serving as a member of the Board
4 of Trustees pursuant to appomtment under subparagraph (A)
5 .who is not a full-time employee of the Federal Government
6 shall be entitled to per diem compensation at rates fi.xed by
7 the PresIdent, but not more than the current per diem equiv-
8 alent of the annual rate of basic pay in effect for level rn of
9 lhe Executive Schedule for each day (including traveltime)
10 during which the member is engaged in the actual perform-
11 ance of duties vested III the Board. and such individual shall
12 be allowed, willIe a:way from hIS home or regular place of
13 business in the performance of service for the Board. travel
14 expenses (including per diem in lieu of subsistence) III the
15 same manner as persons employed intermittently in the Gov-
16 ernment service are allo,yed expenses unc.er section 5703 of
17 tItle 5, U mted States Code.".
18 (b) Section 1817(b) of such Act is amended-
19
(1) in the first sentence, by striking out
(, ."..
com-
20 posed of the Secretary of the Treasury, the Secretary
21 of Labor, and the Secretary of Health, EducatIOn, and
22 'VeHare, all ex officio" and inserting in lieu thereof
23 "composed of the members of the Board of Trustees of
24 the Federal Old-Age and Survivors Insurance Trust
HI 161 m
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1 Fund and tl->e Federal Disability Insurance Trust Fund
2 (as specified in section 201(c))"; and
3 (2) by inserting after the first sentence the follow-
4 mg new sentence: "Each individual serving as a
5 member of the Board of Trustees who is not a fu1l~tin:e
6 employee of the Federal Government shall be entitled
7 to compensatIOn and travel expenses in connection
8 with senice for the Board (to the extent such individ-
9 ual is not entitled to compensation and travel expenses
10 for concurrent s~nice under seC~IOn 201(c)~ in the
11 same manner ani to the same extent as is provided in
12 section 201(c)(2)(C) in connecticn with sen'lce for the
13 Board of Trustees to which such section applies.!t,
14 (c) Section 1841(b) of such Act is amended-
15
(1) in the first sentence, by striking out
"
com-
16 posed of the Secrel.ary of the Treasury, the Secretary
17 of Labor, and the Secretary of Health, Education, and
18 'YeHare. till ex officio" and inserting in lieu thereof
19 "composed of the members of the Board of Trustees of
20 the Federal Old-Age and Surviyors Insurance Trust
21 Fund and the Federal Disability Insurance Trust Fund
22 (as specifIed in section 201 (c))"; and
23 (2) by inserting after the first sentence the follow-
24 mg new sentence: "Each individual serving as a
25 member of the Board of Trustees who is not a full-time
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1 employee of the Federal Government shall be entItled
2 to compensation and trayel expenses in connection
3 \'lIth seryice for the Board (to the extent such indiyid-
4 nal is not entitled to compensation and travel expenses
5 for concurrent service under section 201(c) or 1817ru))
6 in the same manner and to the same extent as is pro-
7 vided in section 201(c)(2)(C) in connection WIth sen-ice
8 for the Board of Trustees to \vhich such sectIon ap-
9 plies.",
10 (d) The PresIdent shall inake the fIrst appointments
11 under sectIOn 20Hc)(2) of the Social Security .....;.ct not later
12 than 30 days after the date of the enactment of this Act,
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National Crusade Director_Effie Hetrick
Crusade Director trvlng Ross
Assi:tant Director Martin Koebel
Technical Advisor Allen Johnston,
Washington, D C
(202) 22&3335
Commitee to Restore Social Security & Medicare
z.-
News and Communications
Anthoney Peters, Compton, CA
April 1, 198;
Hawthorne City Hall
4455 W 126th Street
Hawthorne, CA 90250
(213) 910- 7242
(213) 634.4010
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Dear Ms. Shore:
(COPIED FOR ALL COT.J~CIL- :-'
MEI'-1BERS}~ $ . ~r ~~
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'1rvr fY r- ~
t'resen'tly, an estimated t:..4 million to 4.2 million $enior~-"'Cl.t-~etls
are receiving Social Security benefits that are approximately
$75.00 to $104.00 less per month because of an error creat~d by
Congress in 1977.
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~s. Ann Shore, City Clerk
Santa Monica City Hall
1685 Kain Street
Santa Yonica, Ca. 90401
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Is this fair?
We are a volunteer Senior Citizens Committee dedicated to restoring
the inequity that is discriminating against retirees born between
1917 and 1921. Our Committee has collected approximately 25,000
signatures, in the form of petitions, to correct this "Notch Botch"
and to restore "the Right" that our Seniors are entitled to enjoy
by previous legislation.
Presently, there are several Bills that have been introduced in
Congress and others are pending. One of these Bills is HR-19l7
sponsored by Congressman Roybal. We have the assurance of approxi-
mately 130 legislators that they will support such legislation on
our behalf. The moment of truth is now at hand. Will you help?
We need a Resolution by your Mayor and Council Members as soon as
possible. Time is of the essence!
Pl~~~~ s~e e~c!~~~d ~~p~ ~!
Compton, Cal.
Please direct any questions or inquiries to me at 21)--634-4010.
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Thank you for your support and cooperation.
Sincere~lY- ;~~~-' 45t-~-€-iJ
(Mrs.) E . l~ Hetrick
Nationa 'Crusade Director
EH:wc--Encl.
Secretary and Treasurer Wilma Churchill
Correspondence Director Betty Low
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March 12, 1985
TO:
FROM:
SUBJfCT:
MAYOR AND CITY COUNCIL MEMBERS
CITY ft\A.NAGER
RESOLUTION SUPPORTING REINTRODUCTION OF LEGISLATION TO
REMEDY INEQUITIES IN THE SOCIAL SECURITY SYSTEM.
BACKGROUND
To protect the Social Security System's solvency and to allow' for
inflation. the United States Congress enacted legislation to change
benefit computation formulas and indexed payments to the Consumer Price
Index. Although well intentioned, the legislation resulted in a
double-adjustment for inflation befng enacted. These fncreased benefit
payments escalated the depletion of the Social Security fund. and :~hen
the double-adjustment error was discovered. -Corigress arbitrarily
diminished benefits for retirees born between 1917 and 1921 to counteract
the error's previous effects on the system's resources~ 1917, 1918,
1919. 1920 and 1921 came to 'be known as the "notch years. II and the notch
was identified with large differences in benefits for retirees with
similar work histories.
STATEMENT OF THE ISSUE
To adjust Social Security benefits for inflation, Congress enacted
legislation that imposed a double-adjustment. one for wages and another
for the cost of living. Tbis was an error. and it Was rapidly depleting
the Social Security System's funds. It became obvious that the System
would be bankruDt by the turn of the century as retirees would be
receiving more in benefits than they had contributed.
In 1977. to correct the over~compensation error. Congress establ ished
. new formula for calculating benefits. and arbitrarily diminished
benefits for reti rees born duri n9 the "notch years". In the 1970' 5
and 1980's wages were much higher than in the 1950's. For notch retirees
working up to age 65 in the early 80's, the~e earnings would constitute
their highest salaries. The law prohibits these post-age 62 earnings
from being used in computing Social Secur1 ty benefits. Reti rees born
during the notch years receive approximately $110 less than other retirees
with similar earning patterns.
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To understand the magnitude of the error, the basic calculation formula
must be explained. Present law provides that benefits are based on
25 computation years of highest earnings up to a maximum of $25,900.
Earnings after age 62 are not included in benefit computations. The
total earnings are divided by 300 (the number of months in 25 years),
and the benefit derived frol!' this step is increased by the cumulative
value of all cost of living adjustments (COLA's) awarded after 1980.
Unequal benefits can be abated by increasing the maximum computation
years from 25 to 27 and raising maximum earnings to $29,700. This would
allow the post-age 62 earnings to be included in benefit calculations.
Double-indexing can be prevented by continuing to adjust for price
inflation, but limiting the wagel"productfvity increases to thre~L I=t!s~...
1978 years. These corrections would apply only to retirees who iYK1Iri1!-~
age 62 in 1977 or had 27 years of social security coverage. These changes
were proposed in legislation introduced in 1984, but the measure was
defeated. Congressman Edward Roybal intends to better organize the
~uPPDr' for tpese changes a~d ~eintroduce legislation to realize them.
RECOMMENDATION
It is recoTmlended that the Mayor and City Council approve the attached
resolution supporting reintroduction of legislation to eradicate the
inequities in the Socf.al Security System. That I certified copy of
this resolution be forwarded to Congressman Edward Roybal. Mervyn Dymally
and Senators Pete Wilson and Alan Cralston.
~~ft~
~THY EVERSON, DIRECTOR
ECONOMIC 0 GRANTS MANAGEMENT SERVICES
LAVERTA MONTGOMERY
CITY MANAGER
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RESOLl IN NO. 14 5
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STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
CITY OF COMPTON
I, Charl es Davis t Ci ty C1 erk of the City of Compton, hereby terti fy
that the foregoing Resolution was adopted by the City Council, siQned by
the Mayor and attested by the City Clerk at a regular meetinq thereof held
on the 12th day of March , 1985.
AYES:
NOES:
ABSENT:
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