HomeMy WebLinkAboutAgenda Packet - March 30, 1994 - CC Special CEMISER 0 OF AZUSA
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Finance Department • 213 E. Foothill Blvd. • P.O. Box 1395 • Azusa,CA 91702-1395
(818)334-5125
AGENDA ITEM
TO: HONORABLE MAYOR AND MEMBERS OF
THE CITY COUNCIL , - 1
FROM: GEOFF CRAIG,DIRECTOR OF FINANCE
VIA: HENRY GARCIA,CITY ADMINISTRATOR
DATE: MARCH 23, 1994
SUBJECT: AMENDMENT TO PUBLIC EMPLOYEES' RETIREMENT SYSTEM
CONTRACT TO PROVIDE CREDIT FOR UNUSED SICK LEAVE,
ADDITIONAL SERVICE CREDIT TO RETIREES,AND TO EXTEND
ACTUARIAL VALUATION PERIOD TO THE YEAR 2011
Background
As a step towards encouraging employees to use sick leave more prudently, thereby reducing the
City's costs for overtime, and to assist older employees who will be retiring, this report
recommends that the City Council conduct the second reading of an Ordinance and adopt an
Urgency Ordinance to amend the City's contract with the Public Employees' Retirement System.
The additional cost will be offset by extending the actuarial valuation period to the year 2011.
Findings
Government Code Section 20862.8, Credit for Unused Sick Leave, and Section 20818.2, Two
Additional Years of Service Credit, would be enabled for the City of Azusa by a contract
amendment with the Public Employees' Retirement System. The cost for Credit for Unused Sick
Leave will be 0.208% for miscellaneous employees and 0.288% for police safety employees.
This cost will be more than offset by extending the amortization of the City's unfunded liability
with PERS to the year 2011 (a reduction of 0.712% for miscellaneous members and 1.782% for
safety members) effective July 1, 1995. This will result in a savings as follows:
7
Honorable Mayor and Members of the City Council
March 23, 1994
Page 2
Miscellaneous Safety Total
Credit for Unused Sick Leave 0.208 0.288
Extension to 2011 (0.712) (1.782)
Net Rate (0.504) (1.494)
Net Cost $(40,520) $(42,739) $(83,259)
Two Years Service Credit for
3 Persons 38.533 32.456 70.989
Total $( 1.987) $(10.283) $(12.270)
At present, there are three employees for whom the two years' additional service credit under
Section 20818.2 has been considered. The cost of offering it to those three individuals would be
approximately $70,989. This cost will be more than offset by the reduced annual payments to the
Retirement System.
Recommendation
Staff recommends that Council:
(a) Conduct the second reading and adopt the Ordinance Authorizing an Amendment to the
Contract Between the City Council of the City of Azusa and the Board of Administration
of the California Public Employees' Retirement System; and
(b) Adopt an Urgency Ordinance to put the above into immediate effect.
GJC:pap
f:\council\persamnd.942
ORDINANCE NO.4.-o3
AN ORDINANCE OF THE CITY COUNCIL OF TIIE CITY OF AZUSA
AUTHORIZING AN AMENDMENT TO THE CONTRACT BETWEEN
THE CITY COUNCIL. OF THE CITY OF AZUSA AND THE BOARD
OF ADMINISTRATION OF THE CALIFORNIA PUBLIC
EMPLOYEES' RETIREMENT SYSTEM
THE CITY COUNCIL OF THE CITY OF AZUSA does ordain as follows:
SECTION 1. That an amendment to the Contract between the City Council of the City
of Azusa and the Board of Administration of the California Public Employees' Retirement
System is hereby authorized, a copy of said amendment being attached hereto marked "Exhibit
A", and by such reference made a part hereof as though herein set out in full.
SECTION 2. The Mayor of the City of Azusa is hereby authorized, empowered, and
directed to execute said amendment for and on behalf of the said agency.
SECTION 3. This Ordinance shall take effect thirty (30) days after the date of its
adoption, and prior to the expiration of fifteen(15)days from passage thereof shall be published
at least once in the Azusa Ilerald, a newspaper of general circulation, published and circulated
in the City of Azusa and thenceforth and thereafter the same shall be in full force and effect.
PASSED AND APPROVED this 30th day of MARCH , 1994.
4i1711 �AS.�--
MAYO
STAT OF CALIFORNIA
}
COUNTY OF LOS ANGELES ) ss.
CITY OF AZUSA }
•
I, ADOLPH SOLIS, City Clerk of the City of Azusa, do hereby certify that the foregoing
Ordinance No. _93_4j3_____ was regularly introduced and placed upon its first reading at a
meeting of the City Council on the_7th day of MARCH , 1994. That
thereafter, said Ordinance was duly adopted and passed at a soeciilmeeting of the City Council
on the 101-h .day of MAR('H , 1994 by the following vote, to wit:
AYES: COU NCILMEMBERS: DANGLEIS, MADRIDM NARANJO,ALE{ANDER, MOSES
NOES: COUNCILMEMBERS: NONE
ABSENT: COUNCILMEMBERS: NONE
CI LERK
EXHIBIT A
AMENDMENT TO CONTRACT
BETWEEN
THE BOARD OF ADMINISTRATION
OF THE
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
AND THE
CITY COUNCIL OF THE CITY OF AZUSA
The Board of Administration, Public Employees' Retirement System, hereinafter referred to as
Board, and the governing body of the above public agency, hereinafter referred to as Public
Agency, having entered into a contract effective January 1, 1949, and witnessed December 20,
1948, and as amended effective July 1, 1956, September 1, 1958, March 2, 1959, May 1, 1960,
September 3, 1967, December 22, 1968, July 15, 1973, April 20, 1975, January 18, 1081, July
1, 1984, January 12, 1986, February 7, 1988 and November 27, 1988, which provides for
participation of Public Agency in said System, Board and Public Agency hereby agree as follows:
A. Paragraphs 1 through 13 are hereby stricken from said contract as executed effective
November 27, 1988 and hereby replaced by the following paragraphs numbered 1 through
14 inclusive:
1. All words and terms used herein which are defined in the Public Employees'
Retirement Law shall have the meaning as defined therein unless otherwise
specifically provided. "Normal retirement age" shall mean age 60 for local
miscellaneous members, age 55 for local fire members and age 50 for local police
members.
2. Public Agency shall participate in the Public Employees' Retirement System from
and after January 1, 1949 making its employees as hereinafter provided, members
of said System subject to all provisions of the Public Employees' Retirement Law
except such as apply only on election of a contracting agency and are not provided
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 in 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 referred to as local safety members);
(b) Local Police Officers (herein referred to as local safety members);
(c) Employees other than local safety members (herein referred to as local
miscellaneous members).
4. In addition to the classes of employees excluded from membership by said
Retirement Law, the following classes of employees shall not become members of
said Retirement System:
NO ADDITIONAL EXCLUSIONS
5. Prior to January 1, 1975 those members who were hired by Public Agency on a
temporary and/or seasonal basis not to exceed 6 months were excluded from PERS
membership by contract. Government Code Section 20336 supersedes this contract
provision by providing that any such temporary and/or seasonal employees are
excluded from PERS membership subsequent to January 1, 1975.
6. The percentage of final compensation to be provided for local miscellaneous
members for each year of credited prior and current service shall he determined in
accordance with Section 21251.13 of said Retirement Law, subject to the reduction
provided therein for service on and after January 1, 1956, the effective date of Social
Security coverage, and prior to March 31, 1975, termination of Social Security, for
members whose service has been included in Federal Social Security (2% at age 60
Full and Modified).
7. The percentage of final compensation to be provided for each year of credited prior
and current service as a local fire member shall be determined in accordance with
Section 21252.1 of said Retirement Law (One-half pay at age 55 Full).
8. The percentage of final compensation to be provided for each year of credited prior
and current service as a local police member shall be determined in accordance with
Section 21252.01 of said Retirement Law (2% at age 50 Full).
9 Public Agency elected and elects to be subject to the following optional provisions:
(a) Sections 21263, 21263.1 and 21263.3 (Post-Retirement Survivor Allowance).
(b) Sections 21380-21387 (1959 Survivor Benefits) including Section 21382.4
(Third Level of 1959 Survivor Benefits).
(c) Section 20024.2 (One-Year Final Compensation) for local police members
only.
(d) Section 20818 (Two Years Additional Service Credit).
(e) Section 20862.8 (Credit for Unused Sick Leave) for local miscellaneous
members and local police members only.
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10. Public Agency, in accordance with Government Code Section 20740, ceased to be
an "employer" for purposes of Section 20759 effective on November 27, 1988.
Accumulated contributions of Public Agency shall be fixed and determined as
provided in Government Code Section 20759, and accumulated contributions
thereafter shall be held by the Board as provided in Government Code Section
20759.
11. Public Agency shall contribute to said Retirement System the contributions
determined by actuarial valuations of prior and future service liability with respect
to local miscellaneous members and local safety members of said Retirement System.
12. Public Agency shall also contribute to said Retirement System as follows:
(a) Public Agency shall contribute $2.00 per employee, per month on account of
the liability for the 1959 Survivor Benefits provided under Section 21382.4 of
said Retirement Law. (Subject to annual change.) In addition, all assets and
liabilities of Public Agency and its employees shall be pooled in a single
account, based on term insurance rates, for survivors of all local miscellaneous
members and local safety members.
(b) A reasonable amount, as fixed by the Board, payable in one installment within
60 days of date of contract to cover the costs of administering said System as
it affects the employees of Public Agency, not including the costs of special
valuations or of the periodic investigation and valuations required by law.
(c) A reasonable amount, as fixed by the Board, payable in one installment as the
occasions arise, to cover the costs of special valuations on account of
employees of Public Agency, and costs of the periodic investigation and
valuations required by law.
13. Contributions 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 on account of the experience under the Retirement System as determined
by the periodic investigation and valuation required by said Retirement Law.
14. Contributions required of Public Agency and its employees shall be paid by Public
Agency to the Retirement System within fifteen days after the end of the period to
which said contributions refer or as may be prescribed by Board regulation. If more
or less than the correct amount of contributions is paid for any period, proper
adjustment shall be made in connection with subsequent remittances. Adjustments
on account of errors in contributions required of any employee may be made by
direct payments between the employee and the Board.
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B. This amendment shall be effective on the day of March 19 94 .
BOARD OF ADMINISTRATION CITY COUNCIL OF THE
PUBLIC EMPLOYEES' RETIREMENT SYSTEM CITY OF AZUSA
By ByIre"
Chief, Contract Services Division Mayor
Public Employees' Retirement System
Witness Date March 1994
Attest: -
4r
Ci Clerk
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