AgdaPkt 2018-09-10 Joint SA PFA - Laserfiche WebLink

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6.1.C. - Page 9 Fund expenditures in future fiscal years). e) In addition, estimated information for all projections regarding the next 10 fiscal years set forth in items (a) through (e) above should be presented using a Discount Rate that is 1 percentage point below CaIPERS' then -current Discount Rate. Response: Several of the recommendations have been implemented by the City. The City's annual budget documents and Comprehensive Annual Financial Reports are located on the City's website and contain much of the recommended information. The City also has a "Fiscal Update" link on the front page of the City's website that directs visitors to financial information, budgets, mid- year budget updates, pension presentations and data, CaIPERS information, and the League of California Cities special report on pensions. In addition, staff will be collaborating with the City Council's Finance and Audit Committee this fall to make recommendations on a pension obligation report. R3. The Grand Jury does not recommend specific policies or implementation measures to address pension costs. However, it recommends that, by no later than December 31, 2018, and annually thereafter, each City instruct its staff to deliver a report to the City Council in connection with the City's financial plan evaluating available options to address pension costs and that each City hold public hearings to discuss and consider such options no less than every other fiscal year. These include (but may not be limited to): • Regular supplemental payments to CalPERS (beyond those required by CaIPERS) to accelerate the amortization of their Unfunded Liabilities. • Irregular supplemental payments to CalPERS (beyond those required by CaIPERS), as when a City has a budget surplus or receives special non-recurring revenues. • Electing to apply shorter Amortization Periods (that is, less than 20 years) to their Unfunded Liabilities. • Issuing pension obligation bonds. • Establishing substantial reserves that can be applied in the future to help meet rising pension costs and/or accelerate amortization of Unfunded Liabilities. • Establishing Section 115 trusts for the exclusive purposes of meeting rising pension costs and/or accelerating amortization of Unfunded Liabilities. • Reductions in General Fund operating costs other than pensions. • Seeking additional General Fund revenues that can be applied directly to paying pension costs or that can offset General Fund budget shortfalls that would otherwise occur. • Keeping employee salary increases at or below the levels assumed by CalPERS. • Negotiating cost-sharing agreements with employees under which employees pay a portion of the City's pension costs (without at the same time agreeing to offsetting compensation increases). • Maintaining growth in employee salaries and COLAs at or below the assumed CalPERS rates. • To the extent allowed by law, consider the recommendation of the League of California Cities to renegotiate employee contracts to bring the pension Benefits of Classic Members in line with PEPRA Members, for future work. In particular, ensure that the salary used to determine final retirement compensation is based on the average of the final 3 years of employment (rather than highest 1 year), and that the salary is not enhanced by "spiking," such as by including overtime, unused vacation or N