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<br />43 <br /> <br /> <br />ARTICLE 23 - RETIREMENT <br /> <br />23.1 Retirement Plan <br /> <br />Tier 1: For workers hired prior to October 24, 2011, retirement benefits for workers shall be those <br />established by the California Public Employees’ Retirement System (CalPERS) for Local Miscellaneous <br />Members under the two and seven-tenths percent (2.7%) at age fifty-five (55) formula. For such workers, <br />the City has contracted with CalPERS to provide a retirement benefit calculated based on the highest <br />average pay rate during twelve (12) consecutive months of employment. <br /> Tier 2: For workers hired on or after October 24, 2011, and who do not meet the definition of “new member” <br />as set forth under the Public Employee Pension Reform Act (PEPRA) in Government Code Section <br />7522.04(f), retirement benefits shall be those established by CalPERS for Local Miscellaneous Members <br />under the two percent (2%) at age sixty (60) formula. <br /> For such workers, the CalPERS retirement benefit will be calculated based on highest average pay rate <br />during thirty-six (36) consecutive months of employment. <br /> <br /> Tier 3: For employees hired on or after January 1, 2013 and who meet the definition of “new member” as <br />set forth under PEPRA in Government Code Section 7522.04(f), retirement benefits shall be those <br />established by CalPERS for Local Miscellaneous Members under the two percent (2%) at age sixty-two (62) <br />formula, in accordance with Government Code Section 7522.20. For such workers, the CalPERS retirement <br />benefit will be calculated based on highest average pay rate during thirty-six (36) consecutive months of <br />employment. <br /> <br />23.2 Employee and Employer Contributions to Pension <br /> <br />Tier 1 employees: Effective with the CalPERS contract amendment to provide the Local Miscellaneous <br />Members two and seven-tenths percent (2.7%) at age fifty-five (55) retirement formula on July 10, 2006, <br />each worker hired before the establishment of a second pension tier (2% at 60) shall pay the worker’s eight <br />percent (8%) contribution to CalPERS in accordance with the rules and regulations governing such <br />contributions. <br /> <br />Tier 2 employees: Each worker hired on or after the establishment of a second pension tier (2% at 60) and <br />included in Tier 2 retirement as defined in Section 23.1 of this agreement shall pay the worker’s seven <br />percent (7%) contribution to CalPERS in accordance with the rules and regulations governing such <br />contributions. <br /> <br />Tier 3 employees: Each worker hired on or after January 1, 2013 considered a “new member” as set forth <br />under PEPRA shall pay the rate prescribed by CalPERS for member contributions to CalPERS in <br />accordance with the rules and regulations governing such member contributions, which consists of one-half <br />(1/2) of the total normal costs for pension, in addition to any cost-share requirement. New members shall be <br />subject to the provisions of the PEPRA, including provisions governing reportable compensation. <br /> <br /> The City shall pay the rate prescribed by CalPERS for employer contributions to CalPERS in accordance <br />with the rules and regulations governing such employer contributions, less any cost-share amount as <br />described in this section. <br /> <br />23.3 The City shall maintain the implementation of the provisions of Internal Revenue Code section 414(h) (2) for <br />the term of this Memorandum of Understanding., so long as those provisions of (414(h)(2)) remain <br />substantially the same, and so long as there is no additional cost the employer for this 414(h)(2) <br />6.3.B. - Page 53