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who are current CalPERS members remain eligible for the City’s Tier 2 benefits. <br />Among the reforms included in the new law was the elimination of EPMC for all new <br />CalPERS members. Therefore, new employees hired by the City who were also new <br />members under CalPERS after January 1, 2013 are ineligible for EPMC and currently <br />pay their full member contribution. <br /> <br />ANALYSIS <br />In order to continue efforts toward structural benefit reform, and to provide a consistent <br />and equitable compensation program for all employees, the City proposed to eliminate <br />the 7% EPMC over the course of three years for Tier 1 and Tier 2 employees. The City <br />met and conferred with Executive Management, RCMEA and COA, and agreements <br />were reached to shift the payment of the 7% EPMC from the City to the employee. At <br />the end of 3 years the employees will be paying the full member contribution of 7%-9% <br />depending on the employee’s benefit tier and plan. The current Executive Management <br />Summary of Benefits, and Memoranda of Understanding with RCMEA and COA, <br />provide that all Tier 1 and Tier 2 employees in these groups will start to pay a portion of <br />their member contributions in 2014. In addition, the new agreements include additional <br />employee contributions to pay a portion of the City’s share of pension costs. When fully <br />implemented, the total employee contribution will range from 13% of salary for <br />miscellaneous (non-safety) non-management employees to 20% for Executive <br />Management employees (21% for safety executives). <br /> <br />The EPMC amount that is reported to CalPERS must be modified to align with the <br />agreements with these groups, requiring a resolution each time the EPMC amount is <br />changed to effectuate the changes with CalPERS regarding the reported compensation <br />for the purpose of calculating retirement benefits. With the approval and adoption of this <br />resolution, the additional amount of two percent (2%) will be paid by the employee <br />towards the retirement contribution. In order to achieve the full elimination of EPMC, the <br />current Executive Management Summary of Benefits, and Memoranda of <br />Understanding with RCMEA and COA call for Tier 1 and Tier 2 members to begin to <br />pay an additional two percent (2%) in 2015 and an additional three percent (3%) in <br />2016. In order to effectuate these future changes, resolutions to make these additional <br />adjustments with CalPERS will be submitted in September, 2015 and September, 2016. <br /> <br />ALTERNATIVES <br />Changes to the EPMC amounts were previously negotiated with employee groups and <br />approved by Council. Therefore, no alternative actions are proposed. <br /> <br />FISCAL IMPACT <br />The agreement with Executive Management, RCMEA and COA, for Tier 1 and Tier 2 <br />members to pay towards the employee share of the contribution to CalPERS was part <br />of the adopted Executive Management Summary of Benefits and Memoranda of <br />Understanding with RCMEA and COA, and resulting fiscal impacts were incorporated in <br />the current 2014-2015 budget. <br /> <br /> <br />7.3.B. - Page 2