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HomeMy WebLinkAbout2011/02/22 Item 13CITY COUNCIL AGENDA STATEMENT ~~~ CITY OF ___._ CHULAVISTA FEBRUARY 22, 2011 Item ITEM TITLE: A) RESOLUTION OF INTENTION TO APPROVE AN AMENDMENT TO THE CONTRACT BETWEEN THE BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM (CALPERS) AND THE CITY COUNCIL OF TAE CITY OF CHULA VISTA TO PROVIDE (1) SECTION 21353 (2% @ 60 FORMULA) TO ALL LOCAL MISCELLANEOUS MEMBERS, (2) SECTION 21363.1 (3% @ 55 FORMULA) TO ALL LOCAL SAFETY MEMBERS, AND (3) SECTION 20037 (THREE-YEAR FINAL COMPENSATION) TO ALL LOCAL MISCELLANEOUS AND LOCAL SAFETY MEMBERS, WHO ARE ENTERING MEMBERSHIP FOR THE FIRST TIME AFTER THE EFFECTIVE DATE OF THIS CONTRACT AMENDMENT B) RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA STATING THAT IT WILL NOT BE PAYING OR REPORTING EMPLOYER PAID MEMBER CONTRIBUTIONS (EPMC) UNDER SECTION 20691 FOR ANY LOCAL MISCELLANEOUS AND LOCAL SAFETY MEMBERS WHO ARE ENTERING MEMBERSHIP UNDER .THE SECOND TIER RETIREMENT BENEFITS C) ORDINANCE AUTHORIZING AN AMENDMENT TO THE CONTRACT BETWEEN THE BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM (CALPERS) AND THE CITY COUNCIL OF THE CITY OF CHULA VISTA TO PROVIDE (1) SECTION 21353 (2% @ 60 FORMULA) TO ALL LOCAL MISCELLANEOUS MEMBERS, (2) SECTION 21363.1 (3% @ 55 FORMULA) TO ALL LOCAL SAFETY MEMBERS, AND (3) SECTION 20037 (THREE-YEAR FINAL COMPENSATION) TO ALL LOCAL MISCELLANEOUS AND LOCAL SAFETY MEMBERS, WHO ARE ENTERING MEMBERSHIP FOR THE FIIiST TIME AFTER THE EFFECTIVE DATE OF THIS CONTRACT AMENDMENT (FIRST READING) 13-1 FEBRUARY 22, 2011, Item /J~ Page 2 of 4 SUBMITTED BY: DIRECTOR OF HUMAN RESOURCES ,~f// REVIEWED BY: CITY MANAGER ~ ST ASSISTANT CITY MANAGER ~~ 4/STHS VOTE: YES ~ NO ~X SUMMARY In collaboration with the five labor unions representing the majority of its employees the City has reached agreement as to how to effect comprehensive pension reform. The reform consists of two components: employee contributions to their retirement plan and the establishment of a second tier of benefits for new hires. In order to establish the second tier benefits the City must amend its contract with Ca1PERS. This Resolution of Intention and Ordinance (First Reading) are the first steps in that contract amendment process. Additionally, a Resolution is included clarifying that City will pay zero percent of the member contributions and consequently there will be no employer paid member contributions to be reported as compensation for employees hired under the second tier. ENVHiONMENTAL REVIEW Not applicable. RECOMMENDATION That Council adopt these resolutions and place this ordinance on first reading. BOARDS/COMMISSION RECOMMENDATION Not applicable. DISCUSSION The City's goal of comprehensive pension reform was attained when it reached agreement and its five labor groups: Chula Vista Employees Association (CVEA), Western Council of Engineers (WCE), Mid-Managers/Professional Association (MM/PROF), International Association of Fire Fighters (IAFF) and Police Officer's Association (POA) to provide reduced retirement benefits to newly hired employees. This follows a similar voluntary concession by the City's unrepresented employees including the Mayor, Council, City Attorney, Executive, Senior Management and Confidential employees. These benefits will be referred to as Second Tier Ca1PERS benefits. The changes to the City's contract with CaIPERS to implement this Second Tier include: • Designating that a different level of benefits will be provided for Local Miscellaneous and Local Safety Members hired after the effective date of the contract amendment (Government Code §20475-Different Level of Benefits) • Stating that Second Tier Local Miscellaneous Members will receive the 2% @ 60 Full Formula and that the highest three-years will be used to determine final compensation (Government Code §20037) 13-2 FEBRUARY 22, 2011, Item ~3 Page 3 of 4 • Stating that Second Tier Local Safety Members will receive the 3% @ 55 Full Formula and that the highest three-years will be used to determine final compensation (Government Code §20037) These benefit changes will apply to those hired after the contract effective date (Apri122, 2011) and to those current employees who become eligible for Ca1PERS membership after the effective date. Additionally, by resolution the City clarifies that it will pay zero percent of the Second Tier employees' employee contribution to Ca1PERS (currently 7% for Miscellaneous Employees and 9% for Local Safety). Consequently there will be no employer paid member contributions to report as compensation. Ca1PERS Contract Amendment Process The process to amend a contract with Ca1PERS is very specific as to steps and timeframes. After adoption of this Resolution of Intention and first reading of the Ordinance, at least 20 days must pass before City Council can adopt the final ordinance. The final ordinance will be presented on March 15, 2011, and will be effective 30 days thereafter, April 13, 2011. The Contract amendment will be effective April 22, 2011, the first day of the first pay period following the effective date of the Ordinance. The resolution(s), ordinance, and other documents provided are in the form required by Ca1PERS. DECISION MAKER CONFLICT Staff has reviewed the decision contemplated by this action and has determined that it is not site specific and consequently the 500 foot rule found in Califomia Code of Regulations § 18704.2(a)(1) is not applicable to this decision. Staff Member Conflicts Verification By: Edith Quicho Date: 02/15/11 CURRENT YEAR FISCAL IMPACT The current year fiscal impact will be nominal, as we do not anticipate that we will be hiring anyone this fiscal year that would fall under the Second Tier. ONGOING FISCAL IMPACT It is expected that in the long term, pension benefit casts will decrease due to the reduction in benefits for the Second Tier members. ATTACHMENTS For signature (1) Resolution of Intention to Approve an Amendment to Contract Between the Board of Administration of the California Public Employees' Retirement System and the City Council of the City of Chula Vista (2) Certification of Compliance With Government Code Section 20475 (CON-30) 13-3 FEBRUARY 22, 2011, Item 03 Page 4 of 4 (3) Certification of Governing Body's Action (CON-12) (4) Ordinance Authorizing an Amendment to the Contract Between the Board of Administration of the California Public Employees' Retirement System and the City Council of the City of Chula Vista. (5) Resolution of the City Council of the City of Chula Vista stating that it will not be paying or reporting member contributions for Second Tier members. Exhibits (1) Sample Amendment to Contract Between the Board of Administration of the California Public Employees' Retirement System and the City Council of the City of Chula Vista (2) Summary of Major Provisions 2% @ 60 Formula (3) Summary of Major Provisions 3% @ 55 Formula Prepared by: Kelley Bacon, Director of Human Resources 13-4 RESOLUTION OF INTENTION TO APPROVE AN AMENDMENT TO CONTRACT BETWEEN THE BOARD OF ADMINISTRATION CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM AND THE CITY COUNCIL CITY OF CHULA VISTA WHEREAS, the Public Employees' Retirement Law permits the participation of public agencies and their employees in the Public Employees' Retirement System by the execution of a contract, and sets forth the procedure by which said public agencies may elect to subject themselves and their employees to amendments to said Law; and WHEREAS, one of the steps in the procedures to amend this contract is the adoption 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 following is a statement of the proposed change: To provide Section 20475 (Different Level of Benefits). Section 21353 (2% @ 60 Full formula) and Section 20037 (Three-Year Final Compensation) are applicable to local miscellaneous members entering membership for the first time in the miscellaneous classification after the effective date of this amendment to contract. Section 20475 (Different Level of 8eneftts). Section 21363.1 (3% @ 55 Full formula) and Section 20037 (Three-Year Final Compensation) are applicable to local safety members entering membership for the first time in the safety classification after the effective date of this amendment to contract. NOW, THEREFORE, BE IT RESOLVED that the governing body of the above agency does hereby give notice of intention to approve an amendment to the contract between said public agency and the Board of Administration of the Public Employees' Retirement System, a copy of said amendment being attached hereto, as an "Exhibit" and by this reference made a part hereof. By: Presiding Officer Title Date adopted and approved (amendment) 13-5 CON-3Q2 (Rev. 4/96) RESOLUTION NO. 2011- RESOLUTION OF INTENTION TO APPROVE AN AMENDMENT TO THE CONTRACT BETWEEN THE BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM (CALPERS) AND THE CITY COUNCIL OF THE CITY OF CHULA VISTA TO PROVIDE (1) SECTION 21353 (2% @ 60 FORMULA) TO ALL LOCAL MISCELLANEOUS MEMBERS, (2) SECTION 21363.1 (3% @ 55 FORMULA) TO ALL LOCAL SAFETY MEMBERS, AND (3) SECTION 20037 (THREE-YEAR FINAL COMPENSATION) TO ALL LOCAL MISCELLANEOUS AND LOCAL SAFETY MEMBERS, WHO ARE ENTERING MEMBERSHIP FOR THE FIRST TIME AFTER THE EFFECTIVE DATE OF THIS CONTRACT AMENDMENT WHEREAS, the Public Employees' Retirement Law permits the participation of public agencies and their employees in the Public Employees' Retirement System by the execution of a contract, and sets forth the procedure by which said public agencies may elect to subject themselves and their employees to amendments to said Law; and WHEREAS, one of the steps in the procedures to amend this contract is the adoption 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 summery of the change proposed in said contract; and WHEREAS, the following is a statement of the proposed change: To provide Section 20475 (Different Level of Benefits). Section 21353 (2% @ 60 Full formula) and Section 20037 (Three-Year Final Compensation) are applicable to local miscellaneous members entering membership for the first time in the miscellaneous classification after the effective date of this amendment to contract. Section 20475 (Different Level of Benefits). Section 21363.1 (3% at 55 Full formula) and Section 20037 (Three-Year Final Compensation) are applicable to local safety members entering membership for the first time in the safety classification after the effective date of this amendment to contract. NOW, THEREFORE, BE IT RESOLVED, that the governing body of the City of Chula Vista does hereby give notice of intention to approve an amendment to the contract between said public agency and the Board of Administration of the Public Employees' Retirement System, a copy of said amendment being attached hereto, as an "Exhibit" and by this reference made a part hereof. 13-6 Resolution No. Page 2 Date adopted and approved Presented by Kelley Bacon Director of Human Resources By: Presiding Officer Title Approved as to form by Glen R. Googins City Attorney 13-7 CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM Actuarial and Employer Services Branch Public Agency Contract Services P.O. Box 942709 Sacramento, CA 94229-2709 (888) CaIPERS (225-7377) I hereby certify that the CERTIFICATION OF COMPLIANCE WITH GOVERNMENT CODE SECTION 20475 City Council of the (governing body) Citv of Chula Vista (public agency) has fully discharged all of the obligation imposed by Chapter 10 (commencing with Section 3500) of Division 4 of Title 1, Government Code. BY. Witness Title Date PERS-CON30 (Rev. 1/96) 13-8 CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM Actuarial and Employer Services Branch Public Agency Contract Services P.O. Box 942709 Sacramento, CA 94229-2709 (888) CaIPERS (225-7377) CERTIFICATION OF GOVERNING BODY'S ACTION 1 hereby certify that the foregoing is a true and correct copy of a Resolution adopted by the City Council Of the (governing body) ;ity of Chula Vista (public agency) On February 22, 2011 (date) Clerk/Secretary Donna Norris, CMC City Clerk Title PERS-CON-12 (rev. 1196) 13-9 ORDINANCE NO. ORDINANCE AUTHORIZING AN AMENDMENT TO THE CONTRACT BETWEEN THE BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM (CALPERS) AND THE CITY COUNCIL OF THE CITY OF CHULA VISTA TO PROVIDE (1) SECTION 21353 (2% @ 60 FORMULA) TO ALL LOCAL MISCELLANEOUS MEMBERS, (2) SECTION 21363.1 (3% @ 55 FORMULA) TO ALL LOCAL SAFETY MEMBERS, AND (3) SECTION 20037 (THREE-YEAR FINAL COMPENSATION) TO ALL LOCAL MISCELLANEOUS AND LOCAL SAFETY MEMBERS, WHO ARE ENTERING MEMBERSHIP FOR THE FIRST TIME AFTER THE EFFECTNE DATE OF THIS CONTRACT AMENDMENT WHEREAS, the City of Chula Vista is a contracting Public Agency of the California Public Employees' Retirement System; and WHEREAS, the City of Chula Vista desires to adopt this ordinance to authorize an amendment to the contract between the City of Chula Vista and the Board of Administration of the California Public Employee's Retirement System to provide the following: Section 20475 (Different Level of Benefits). Section 21353 (2% @ 60 Formula) and Section 20037 (Three-Year Final Compensation) are applicable to all local Miscellaneous members entering membership for the first time in the Miscellaneous classification after effective date of this contract amendment. Section 20475 (Different Level of Benefits). Section 21363.1 (3% @ 55 Formula) and Section 20037 (Three-Year Final Compensation) are applicable to all local Safety members who are entering membership for the first time after the earliest possible effective after the effective date of this contract amendment. Section 20037 (Three year Final Compensation). Section 20037 (three-year final compensation) is applicable to all Local Miscellaneous and Local Safety members, who are entering membership for the first time after the effective date of this contract amendment. NOW THEREFORE, the City Council of the City of Chula Vista does ordain as follows: Section 1. That an amendment to the contract between the City Council of the City of Chula Vista and the Board of Administration, California Public Employees' Retirement System is hereby authorized, a copy of said amendment being attached hereto, marked Exhibit 1, and by such reference made a part hereof as though herein set out in full. Section 2. 13-10 The Mayor of Chula Vista, the Presiding Officer of the City Council, is hereby authorized, empowered, and directed to execute said amendment for and on behalf of 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 the passage thereof shall be published at least once in the Chula Vista Star News, a newspaper of general circulation, published and circulated in the City of Chula Vista and thenceforth and thereafter the same shall be in full force and effect. Introduced and First Reading on this day of , 2011. Adopted and approved on this day of , 2011. Mayor Cheryl Cox Presiding Officer Approved as to form by: Glen R. Googins City Attorney Attest: Donna R. Norris, CMC City Clerk 13-11 RESOLUTION NO. 2011- RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA STATING THAT IT WILL NOT BE PAYING OR REPORTING EMPLOYER PAID MEMBER CONTRIBUTIONS (EPMC) UNDER SECTION 20691 FOR ANY LOCAL MISCELLANEOUS AND LOCAL SAFETY MEMBERS WHO ARE ENTERING MEMBERSHIP UNDER THE SECOND TIER RETIREMENT BENEFITS WHEREAS, the governing body of the City of Chula Vista has the authority to implement Government Code Section 20636(c)(4) pursuant to Section 20691; and WHEREAS, one of the steps in the procedures of Section 20691 is the adoption of the governing body of the City of Chula Vista of a Resolution to not pay or report the value of Employer Paid Member Contributions (EPMC) for any local miscellaneous and local safety members who are entering membership under the Second Tier Retirement benefits; NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula Vista does hereby elect not to pay or report the value of the Employer Paid Member Contributions as set forth above. Presented by Approved as to form by /~~ /~- Kelley Bacon Director of Human Resources Glen R. Googins City Attorney 13-12 1 ~~,,_ CaIPERS EXHIBIT California Public Employees' Retirement System AMENDMENT TO CONTRACT Between the Board of Administration California Public Employees' Retirement System and the City Council City of Chula Vista The Board of Administration, California 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 October 1, 1948, and witnessed August 31, 1948, and as amended effective October 1, 1951, November 1, 1955, January 1, 1960, January 1, 1961, September 1, 1967, September 28, 1973, October 4, 1973, October 8, 1976, April 16, 1981, January 8, 1982, September 28, 1984, July 3, 1987, October 13, 1989, September 27, 1990, November 16, 1990, January 4, 1991, September 6, 1991, October 7, 1994, June 28, 1995, May 29, 1998, April 7, 2000, July 1, 2002, December 27, 2002, June 27, 2003, August 20, 2004 and November 7, 2007 which provides for participation of Public Agency in said System, Board and Public Agency hereby agree as follows: A. Paragraphs 1 through 15 are hereby stricken from said contract as executed effective November 7, 2007, and hereby replaced by the following paragraphs numbered 1 through 18 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 50 for local safety members entering membership in the safety classification on or prior to the effective date of this amendment to contract and age 55 for local safety members entering membership for the first time in the safety classification after the effective date of this amendment to contract. 13-13 ~?. nn~ ~-f ~a~r nl~~_f s ,n ~ ;-,ice .~, p35 f L'~1-ts.~ c.J:.i 1~FJ! viu~Y ~Jv :~,1 E.'+~-.i 2. Public Agency shall participate in the Public Employees' Retirement System from and after October 1, 1948 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. Public Agency agrees to indemnify, defend and hold harmless the California Public Employees' Retirement System (CaIPERS) and its trustees, agents and employees, the CaIPERS Board of Administration, and the California Public Employees' Retirement Fund from any claims, demands, actions, losses, liabilities, damages, judgments, expenses and costs, including but not limited to interest, penalties and attorneys fees .that may arise as a result of any of the following: (a) Public Agency's election to provide retirement benefits, provisions or formulas under this Contract that are different than the retirement benefits, provisions or formulas provided under the Public Agency's prior non-CaIPERS retirement program. (b) Public Agency's election to amend this Contract to provide retirement benefits, provisions or formulas that are different than existing retirement benefits, provisions or formulas. (c) Public Agency's agreement with a third party other than CaIPERS to provide retirement benefits, provisions, or formulas that are different than the retirement benefits, provisions or formulas provided under this Contract and provided for under the California Public Employees' Retirement Law. (d) Public Agency's election to file for bankruptcy under Chapter 9 (commencing with section 901) of Title 11 of the United States Bankruptcy Code and/or Public Agency's election to reject this Contract with the CaIPERS Board of Administration pursuant to section 365, of Title 11, of the United States Bankruptcy Code or any similar provision of law. (e) Public Agency's election to assign this Contract without the prior written consent of the CaIPERS' Board of Administration. 13-14 _., ~ 3- ~ n ;~ z~ z i j n ~ ,ra i r1 ft i '+-• ~ r r aa.. ~ a..ls YJ I\.? S r.~ e ~ ~ .wi ~ ~i [ L) .I . J 1 i ,v (f) The termination of this Contract either voluntarily by request of Public Agency or involuntarily pursuant to the Public Employees' Retirement Law. (g) Changes sponsored by Public Agency in existing retirement benefits, provisions or formulas made as a result of amendments, additions or deletions to California statute or to the California Constitution. 4. 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); Local Police Officers (herein referred to as local safety members); c. Employees other than local safety members (herein referred to as local miscellaneous members). 5. 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 6. Effective October 4, 1993 and 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 superseded this contract provision by providing that any such temporary and/or seasonal employees are excluded from PERS membership subsequent to January 1, 1975. Legislation repealed and replaced said Section with Government Code Section 20305 effective July 1, 1994. 7. This contract shall be a continuation of the contract of the Montgomery Fire Protection District, hereinafter referred to as "Former Agency". The accumulated contributions, assets and liability for prior and current service under the Former Agency's contract shall be merged pursuant to Section 20508 of the Government Code. Such merger occurred January 1, 1986. a. All benefits provided under this contract shall apply to all past service for former employees of the Montgomery Fire Protection District. 13-15 { p41 S6 sF a.° 8. The percentage of final compensation to be provided for each year of credited prior and current service as a local miscellaneous member in employment before and not on or after December 27, 2002 shall be determined in accordance with Section 21354 of said Retirement Law (2% at age 55 Full). 9. The percentage of final compensation to be provided for each year. of credited prior and current service as a local miscellaneous member in employment on or after December 27, 2002 and not entering membership for the first time in the miscellaneous classification after the effective date of this amendment to contract shall be determined in accordance with Section 21354.3 of said Retirement Law (3% at age 60 Full). 10. The percentage of final compensation to be provided for each year of credited current service as a local miscellaneous member entering membership for the first time in the miscellaneous classification after the effective date of this amendment to contract shall be determined in accordance with Section 21353 of said Retirement Law (2% at age 60 Full). 11. The percentage of final compensation to be provided for each year of credited prior and current service as a local safety member entering membership in the safety classification on or prior to the effective date of this amendment to contract shall be determined in accordance with Section 21362.2 of said Retirement Law (3% at age 50 Full). 12. The percentage of final compensation to be provided for each year of credited current service as a local safety member entering membership for the first time in the safety classification after the effective date of this amendment to contract shall be determined in accordance with Section 21363.1 of said Retirement Law (3% at age 55 Full). 13. Public Agency elected and elects to be subject to the following optional provisions: a. Section 20965 (Credit for Unused Sick Leave). b. Section 20425 ("Local Police Officer' shall include employees of a police department who were employed to perform identification or communication duties on August 4, 1972 and who elected to be local safety members on or before September 28, 1973). 13-16 y _._~`Sir ~.. ,.=~i t, _.,. t~ c. Section 21325 (One-Time 3% to 15% Increase For Local Miscellaneous Members Who Retired or Died Prior to January 1, 1974). Legislation repealed said Section effective January 1, 2002. d. Sections 21624 and 21626 (Post-Retirement Survivor Allowance) for local safety members only. e. Section 20516 (Employees Sharing Cost of Additional Benefits): Section 21362 (2% @ 50 Full formula) for local safety members. From and after September 28, 1984 to July 1, 1985 the safety employees of Public Agency shall be assessed an additional 0.341 % of their compensation for a total contribution rate of 9.341 pursuant to Government Code Section 20516. f. Section 21574 (Fourth Level of 1959 Survivor Benefits). g. Section 20042 (One-Year Final Compensation) for those local miscellaneous members and local safety members entering membership in the miscellaneous classification and safety classification on or prior to the effective date of this amendment to contract. h. Section 20426 ("Local Police Officer' shall include any officer or employee of a police department employed to perform communication duties and who elected to become a local safety member on August 25, 1973). i. Section 21024 (Military Service Credit as Public Service). j. Section 21623.5 ($5,000 Retired Death Benefit). k. Sections 21624, 21626 and 21628 (Post-Retirement Survivor Allowance) for local miscellaneous members only. I. Section- 20434 ("Local Fire Fighter" shall include any officer or employee of a fire department employed to perform firefighting, fire prevention, fire training, hazardous materials, emergency medical services, or fire or arson investigation services as described in Government Code Section 20434). m. Section 20903 (Two Years Additional Service Credit). 13-17 n. Section 20475 (Different Level of Benefits). Section 21353 (2% @ 60 Full formula) and Section 20037 (Three-Year Final Compensation) are applicable to local miscellaneous members entering membership for the first time in the miscellaneous classification after the effective date of this amendment to contract. Section 21363.1 (3% @ 55 Full formula) and Section 20037 (Three- Year Final Compensation) are applicable to local safety members entering membership for the first time in the safety classification after the effective date of this amendment to contract. 14. Public Agency, in accordance with Government Code Section 20790, ceased to be an "employer" for purposes of Section 20834 effective on October 8, 1976. Accumulated contributions of Public Agency shall be fixed and determined as provided in Govemment Code Section 20834, and accumulated contributions thereafter shall be held by the Board as provided in Government Code Section 20834. 15. 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. 16. Public Agency shall also contribute to said Retirement System as follows: a. Contributions required per covered member on account of the 1959 Survivor Benefits provided under Section 21574 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. 13-18 17. 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. 18. 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. B. This amerydment shall be effective on the ~ ~. BOARD OF ADMIt~.~~T';R,ATION PUBLIC EMPLOYEES~RE,~TIREMENT SYSTEM Cs:+ ~~t'%"9 BY "~ '" ~° ,°? LORI MCGARTLAND, CHIEF '~f.?. EMPLOYER SERVICES DIVISION~ti ; PUBLIC EMPLOYEES' RETIREME~1~°SYSTEM .~ < ''; -. `< AMENDMENT ER#195 PERS-CON-702A day of CITY COUNCIL CITY OF CHULA VISTA B~ =~ ~'+ PR~S.IBI,NG OFFICER .~ ~A s -;;, y `f a `loo.. Witness Date `~%"'' n >r. <" " ; Attest: '>`~°-,. .'~:`. a;, Clerk 13-19 CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM Actuarial and Employer Services Branch Public Agency Contract Services (888) CaIPERS (225-7377) SUMMARY OF MAJOR PROVISIONS 2% @ 60 Formula (Section 21353) Local Miscellaneous Members SERVICE RETIREMENT To be eligible for service retirement, a member must be at least age 50 and have five years of CaIPERS credited service. There is no compulsory retirement age. The monthly retirement allowance is determined by age at retirement, years of service credit and final compensation. The basic benefit is 2% of final compensation for each year of credited service upon retirement at age 60. If retirement is earlier than age 60, the percentage of final compensation decreases for each quarter year of attained age to 1.092% at age 50. If retirement is deferred beyond age 60, the percentage of final compensation increases for each quarter year of attained age to 2.418% at age 63. Final compensation is the average monthly pay rate during the last consecutive 36 months of employment, or 12 months if provided by the employer's contract, unless the member designates a different period of 36 or 12 consecutive months when the average pay rate was higher. DISABILITY RETIREMENT Members substantially incapacitated from performing the usual duties for the position for his/her current employer, and from performing the usual duties of the position for other CaIPERS covered employers (including State agencies, schools, and local public agencies), and where similar positions with these other employers with reasonably comparable in pay, benefits, and promotional opportunities are not available, would be eligible for disability retirement provided they have at least five years of service credit. The monthly retirement allowance is 1.8% bf final compensation for each year of service. The maximum percentage for members who have between 10.000 and 18.518 years of service credit is one-third of their final compensation. If the member is eligible for service retirement the member will receive the highest allowance payable, service or disability. If provided by the employer's contract, the benefit would be a minimum of 30% of final compensation for the first five years of service credit, plus 1 % for each additional year of service to a maximum benefit of 50% of final compensation. INDUSTRIAL DISABILITY RETIREMENT If provided by the employer's contract, members permanently incapacitated from performing their duties, as defined above under Disability Retirement, and the disability is a result of a job- related injury or illness may receive an Industrial Disability Retirement benefit equal to 50% of their final compensation. If provided in the employer's contract and the member is totally disabled, the disability retirement allowance would equal 75% of final compensation in lieu of the disability retirement allowance otherwise provided. If the member is eligible for service retirement, the service retirement allowance is payable. The total allowance cannot exceed 90% of final compensation. PRE-RETIREMENT DEATH BENEFITS Basic Death Benefit: This benefit is a refund of the member's contributions plus interest and up to six months' pay (one month's salary rate for each year of current service to a maximum of six months). 13-20 PERS-CON-44 (Rev. 2/05) 1957 Survivor Benefit: An eligible beneficiary may elect to receive either the Basic Death Benefit or the 1957 Survivor Benefit. The 1957 Survivor Benefit provides a monthly allowance equal to one-half of the highest service retirement allowance the member would have received had he/she retired on the date of death. The 1957 Survivor Benefit is payable to the surviving spouse or registered domestic partner until death or to eligible unmarried children until age 18. 1959 Survivor Benefit: (If provided by the employer's contract and the member is not covered under social security.) A surviving spouse or registered domestic partner and eligible children may receive a monthly allowance as determine by the level of coverage. This benefit is payable in addition to the Basic Death Benefit or 1957 Survivor Benefit. Children are eligible if under age 22 and unmarried. Pre-Retirement Optional Settlement 2 Death Benefit: (If provided by the employer's contract.) The spouse or registered domestic partner of a deceased member, who was eligible to retire for service at the time of death, may to elect to receive the Pre-Retirement Optional Settlement 2 Death Benefit in lieu of the lump sum Basic Death Benefit. The benefit is a monthly allowance equal to the amount the member would have received if he/she had retired for service on the date of death and elected Optional Settlement 2, the highest monthly allowance a member can leave a spouse or registered domestic partner. COST-OF-LIVING ADJUSTMENTS The cost of living allowance increases are limited to a maximum of 2% compounded annually unless the employer's contract provides a 3, 4, or 5% increase. DEATH AFTER RETIREMENT The lump sum death benefit is $500 (or $600, $2,000, $3,000, $4,000 or $5,000 if provided by the employer's contract) regardless of the retirement plan chosen by the member at the time of retirement. TERMINATION OF EMPLOYMENT Members who have separated from employment may elect to leave their contributions on deposit or request a refund of contributions and interest. Those who leave their contributions on deposit may apply at a later date for a monthly retirement allowance if the minimum service and age requirements are met. Members who request a refund of their contributions terminate their membership and are not eligible for any future benefits unless they return to CaIPERS membership. EMPLOYEE CONTRIBUTIONS Miscellaneous members covered by the 2% @ 60 formula contribute 7% of reportable earnings. Those covered under a modified formula (coordinated with Social Security) do not contribute on the first $133.33 earned. The employer also contributes toward the cost of the benefits. The amount contributed by the employer for current service retirement benefits generally exceeds the cost to the employee. In addition, the employer bears the entire cost of prior service benefits (the period of time before the employer provided retirement coverage under CaIPERS). All employer contribution rates are subject to adjustment by the CaIPERS Board of Administration. 13-21 PERS-CON-44 (Rev. 2/05) CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM Actuarial and Employer Services Branch Public Agency Contract Services (888) CaIPERS (225-7377) SUMMARY OF MAJOR PROVISIONS 3% @ 55 Formula (Section 21363.1) Local Safety Members SERVICE RETIREMENT To be eligible for service retirement, a member must be at least age 50 and have five years of CaIPERS credited service. If provided by the employer's contract, mandatory retirement age for local safety members is age 60. The monthly retirement allowance is determined by age at retirement, years of service credit and final compensation. The basic benefit is 3% of final compensation for each year of credited service upon retirement at age 55. If retirement is earlier than age 55, the percentage of final compensation decreases for each quarter year of attained age to 2.40% at age 50. The allowance is limited to 90% of final compensation. Final compensation is the average monthly pay rate during the last consecutive 36 months of employment, or 12 months if provided by the employer's contract, unless the member designates a different period of 36 or 12 consecutive months when the average pay rate was higher. Certain items of special compensation earned during your final compensation period will be included in your final compensation, in accordance with Board regulations. DISABILITY RETIREMENT Members substantially incapacitated from performing the usual duties for the position for his/her current employer would be eligible for disability retirement provided they have at least five years of service credit. The monthly retirement allowance is 1.8% of final compensation for each year of service. The maximum percentage for members who have between 10.000 and 18.518 years of service credit is one-third of their final compensation. If the member is eligible for service retirement the member will receive the highest allowance payable, service or disability. If provided by the employer's contract, the benefit would be a minimum of 30% of final compensation for the first five years of service credit, plus 1% for each additional year of service to a maximum benefit of 50% of final compensation. INDUSTRIAL DISABILITY RETIREMENT Members permanently incapacitated from performing their duties, as defined above under Disability Retirement, and the disability is a result of ajob-related injury or illness may receive an Industrial Disability Retirement benefit equal to 50% of their final compensation. If provided in the employer's contract and the member is totally disabled, the disability retirement allowance would equal 75% of final compensation in lieu of the disability retirement allowance otherwise provided. If the member is eligible for service retirement, the service retirement allowance is payable. The total allowance cannot exceed 90% of final compensation. PRE-RETIREMENT DEATH BENEFITS Basic Death Benefit: This benefit is a refund of the member's contributions plus interest and up to six months' pay (one month's salary rate for each year of current service to a maximum of six months). 13-22 PERS-CON-53 (rev. fi/07) 1957 Survivor Benefit: An eligible beneficiary may elect to receive either the Basic Death Benefit or the 1957 Survivor Benefit. The 1957 Survivor Benefit provides a monthly allowance equal to one- half of the highest service retirement allowance the member would have received had he/she retired on the date of death. The 1957 Survivor Benefit is payable to the surviving spouse or registered domestic partner until death or to eligible unmarried children until age 18. 1959 Survivor Benefit: (If provided by the employer's contract and the member is not covered under social security.) A surviving spouse or registered domestic partner and eligible children may receive a monthly allowance as determine by the level of coverage. This benefit is payable in addition to the Basic Death Benefit or 1957 Survivor Benefit. Children are eligible if under age 22 and unmarried. Pre-Retirement Option 2W Death Benefit: (If provided by the employer's contract.) The spouse or registered domestic partner of a deceased member, who was eligible to retire for service at the time of death, may to elect to receive the Pre-Retirement Option 2W Death Benefit in lieu of the lump sum Basic Death Benefit. The benefit is a monthly allowance equal to the amount the member would have received if he/she had retired for service on the date of death and elected Option 2W, the highest monthly allowance a member can leave a spouse or registered domestic partner. Special Death Benefit: A surviving spouse, registered domestic partner, or eligible children or step children may receive a monthly allowance equal to one-half of the final compensation. If the cause of death is due to external violence or physical force while on the job, and there are eligible surviving children in addition to a spouse or registered domestic partner, the allowance may be increased to a maximum of 75%. COST-OF-LIVING ADJUSTMENTS The cost of living allowance increases are limited to a maximum of 2% compounded annually unless the employer's contract provides a 3, 4, or 5% increase. DEATH AFTER RETIREMENT The lump sum death benefit is $500 (or $600, $2,000, $3,000, $4,000 or $5,000 if provided by the employer's contract) regardless of the retirement plan chosen by. the member at the time of retirement. TERMINATION OF EMPLOYMENT Members who have separated from employment may elect to leave their contributions on deposit or request a refund of contributions and interest. Those who leave their contributions on deposit may apply at a later date for a monthly retirement allowance if the minimum service and age requirements are met. Members who request a refund of their contributions terminate their membership and are not eligible for any future benefits unless they return to CaIPERS membership. EMPLOYEE CONTRIBUTIONS Local safety members covered by the 3% @ 55 formula contribute 9% of reportable earnings. Those covered under a modified formula (coordinated with Social Security) do not contribute on the first $133.33 earned. The employer also contributes toward the cost of the benefits. The amount contributed by the employer for current service retirement benefits generally exceeds the cost to the employee. In addition, the employer bears the entire cost of prior service benefts (the period of time before the employer provided retirement coverage under CaIPERS). All employer contribution rates are subject to adjustment by the CaIPERS Board of Administration. 13-23 PERS-CON-53 (rev. 6/07)