HomeMy WebLinkAboutAgenda Statement 1986/11/12 Item 07COUNCIL AGENDA STATEMENT
• I tem 7
Meeting Date 11/12/86
ITEM TITLE: Report on Required Amendment to the City's PERS Contract to
Provide for the Merger of the Montgomery Fire Protection
District's Retirement Contract with that of the City
a) Resolution ~~}~~~'~ - Of Intention to Adopt Ordinance
Amending the City's Contract with PERS
b) Ordinance ~~~~~' Authorizing Amendment to City's
Contract with PERS - First Reading
SUBMITTED BY: Assistant City Manager '_
REVIEWED BY: City Manager
On January 1, 1986, the employees of the Montgomery Fire Protection District
became employees of the City of Chula Vista. It was the intent of the
City and the Board of Directors of the Montgomery Fire Protection District,
upon annexation, to provide for a merger of the contract between the Montgomery
Fire Protection District and the Public Employees Retirement System with
the City's contract. In order to accomplish the merger, certain steps
must be taken by the City.
• RECOMMENDATION: Adopt Resolution declaring our intent to approve an
amendment to the contract providing for the merger
of the Montgomery Fire Protection District with the
contract of the City of Chula Vista.
Place Ordinance on first reading authorizing an amendment
to the City's PERS contract.
BOARD/COMMISSION RECOMMENDATION: N.A.
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The Public Employees Retirement Law sets forth procedures by which public
agencies may elect to make amendments to their contracts providing retirement
benefits to their employees. The first step in that procedure is to adopt
a resolution of intent, giving notice of the proposed amendment, and a
summary of the changes that are to occur. In this instance, the City,
in adopting the resolution of intention, will be giving notice to amend
our contract to only provide for the merger of the Montgomery Fire Protection
District with the City's in accordance with Government Code sections 20567.1
and 20567.8. No changes in benefits will occur.
Certain other procedural steps are required, including the
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Meeting Date 11/12/86
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need to make public at least two weeks prior to the adoption of the final
ordinance any changes in benefits or costs that we will experience as
a result of the amendment. In our case, this report, which is a public
document, meets the requirements of Government Code Section 7507 and provides
the public the required notice of the changes that we expect will occur
as a result of amendment, and the financial impact of the amendment. The
amendment will result in a reduction in our current PERS rate of 26.621%
to 25.874%, or a reduction of 0.747%, by reason of the merger. This
percentage (25.874% is a projected actuarial rate to the year 2011, but
our contract reads that the employer rate is subject to change with future
amendments and/or experience and other factors. Based upon current safety
member payroll, our annual cost at 25.874% of payroll is $1,821,335.00.
The amendment creates no additional miscellaneous employee costs and therefore
the financial impact is nil.
Since the merger amendment will result in an 0.747% decrease in the City's
retirement cost for safety members, it is important that the required
documents receive timely approval so that the final reading of the ordinance
can take place during the first meeting in December.
FISCAL IMPACT: The first 12 months savings in retirement costs for the
City will be approximately $ 52,580 as a result of the merger amendment.
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by tt,e City Cc~un~ci of
Chula ~lista, California
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Dated
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