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7.1.A. - Page 37 <br /> and we need to continue to budget on a cash basis. With regards to Credit Ratings, he <br /> said that the City doesn't have any general fund obligation and the enterprise funds are <br /> outstanding. He looked at other cities such as South San Francisco, San Mateo, and <br /> Daly City unfunded pension liabilities and determined that Redwood City is going to be <br /> in a similar situation like them. <br /> One Council Member asked if other Finance Directors are getting together to discuss <br /> this issue and if so what are they doing about it. Mr. Ponty said he hadn't heard a lot of <br /> discussion from his colleagues, and that this report is really being studied by CaIPERS. <br /> He will be working with the auditors for the 2014 -2015 Budget to address this matter. <br /> She thanked him for the update and wondered if the City needed to find a way to pay <br /> down the outstanding debt in terms of the pensions. <br /> Another Council Member said he appreciated the report and he said that it will be <br /> interesting once we see this matter reflected on the balance sheet. Furthermore, he <br /> feels that this is an important item to share with the community, particularly the unions <br /> and employees, and how to solve this issue together. <br /> Vice Mayor Foust said that it will be helpful if the Department keeps studying the issue <br /> and how this impacts the State level and how the rating develops and find out the credit <br /> worthiness. She thanked Mr. Ponty for the update. Mayor Gee asked if every part of <br /> the country will be affected by this, and Mr. Ponty confirmed. He believes that as the <br /> transparency shows on the reports then credit agencies will start to participate, thus <br /> impacting the City's credit. <br /> Dr. Bell made a small correction that it would be himself and the new Finance Director <br /> that would have to research and determine how this matter will impact the City since Mr. <br /> Ponty will be retired in a few months. He also mentioned to the Council a letter the <br /> Mayor sent to the CaIPERS Board about the support of certain guidelines regarding the <br /> mortality table. <br /> 9. STUDY SESSION(S) <br /> A Public Employees' Pension Reform Act of 2013 Study Session <br /> Recommendation: <br /> Review the information provided. No Council action is recommended. <br /> Ms. Leah Lockhart, Human Resources Manager, covered the new regulations related to <br /> Public Employees' Pension Reform Act (PEPRA) 2013. She provided background <br /> information to the beginnings of the Pension Reform. She addressed the City's <br /> unfunded liability, how to keep our employees whole, and meet pension requirements <br /> while working with bargaining groups. She provided information about the raise of the <br /> retirement age and how the City negotiated a Cost - Sharing Agreement with $2.6 million <br /> coming from employees. The State's response in bringing future liabilities down was <br /> lowering the retirement formula of new members and but it is not for all new hires. They <br /> created a three -tier formula and the final compensation went to a three -year average. <br /> CITY COUNCIL February 10, 2014 <br /> MEETING AGENDA PAGE 9 <br />