Laserfiche WebLink
<br /> <br />ANALYSIS <br />In order to implement the provisions of the adopted MOU, the Council must amend the <br />City’s contract with CalPERS. The CalPERS contract requires the City Council to adopt <br />a Resolution of Intention to approve an Amendment to the Contract and introduce an <br />Ordinance authorizing an amendment to the Contract. The Council will be presented <br />with the final Ordinance Authorizing an Amendment to Contract at their regular meeting <br />on March 28, 2016, as instructed in the CalPERS approved timelines. <br /> <br />The specific IAFF MOU components that are the subject of this City Council <br />recommended action are as follows: <br /> <br />· In 2016, Tier 1 and Tier 2 members will contribute an additional 2% to <br />CalPERS retirement via cost sharing of the employer’s share as provided <br />for in California Government Code Section 20516(a), Employee Cost <br />Sharing of Additional Benefits. <br />· In 2017, Tier 1 and Tier 2 members will contribute an additional 1% to <br />CalPERS retirement via cost sharing of the employer’s share as provided <br />for in California Government Code Section 20516(a), Employee Cost <br />Sharing of Additional Benefits. This will be implemented through a <br />subsequent CalPERS contract amendment. <br /> <br />State CalPERS law permits cost-sharing of required employer contributions through two <br />different methods. Under the first method, in accordance with Government Code <br />Section 20516(f), pursuant to an MOU, the employee is required to pay the standard <br />employee contribution, and also to pay an additional amount toward the employer’s <br />required contribution. Under this method, the CalPERS contract is not amended, and <br />the additional payment is not credited as an employee contribution within the <br />individual’s CalPERS account. Under the second method, in accordance with <br />Government Code 20516(a), an agency’s contract with CalPERS may be amended to <br />increase the employee contribution to CalPERS, thereby contractually reducing the <br />employer’s cost toward the benefit. This amount is credited to the employee’s account <br />as an employee contribution. For the past several years, the City has implemented cost- <br />sharing with employee groups under the first method. In order to ensure that <br />contributions are credited to the employee’s CalPERS accounts, the City and IAFF <br />agreed to implement a portion of the cost-sharing as an increased employee <br />contribution under Government Code 20516(a). <br /> <br />In order to increase the employee contribution to CalPERS in accordance with <br />Government Code 20516(a), the City’s contract with CalPERS must be amended. The <br />contract amendment requires a Resolution of Intention to Approve an Amendment to <br />Contract, and introduction of an Ordinance authorizing an amendment. <br /> <br />Additionally, as part of the CalPERS contract amendment process, CalPERS requires <br />that an employee election be held. An employee election will be held from February 23, <br />2016 to March 28, 2016 to vote on amending the CalPERS contract to provide for the <br />agreed upon employee cost sharing contribution. After a successful election, Council <br />6.4.B. - Page 2