HomeMy WebLinkAboutCC RES 02-079RESOLUTION NO. 02-79
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF PALM DESERT, CALIFORNIA, STATING THE
CITY'S INTENT TO APPROVE AN AMENDMENT TO THE CONTRACT BETWEEN THE
BOARD OF ADMINISTRATION OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM
AND THE CITY COUNCIL OF THE CITY OF PALM DESERT
WHEREAS, the Public Employees' Retirement Law permits the participation of public
agencies and their employees in the Public Employees Retirement System by the execution of
a contract by which sets forth the procedure by which said public agencies may elect to subject
themselves and their employees to amendments to said Law; and
WHEREAS, one of the steps in the procedures to amend this contract is the adoption by
the governing body of the public agency of a resolution giving notice of its intention to Approve
an amendment to said contract, which resolution shall contain a summary of the change
proposed in said contract; and
WHEREAS, the following is a statement of the proposed change:
To provide Section 21354.5 (2.7% @ 55 Full Formula) for local miscellaneous
members.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Palm Desert,
California, does hereby give notice of intention to approve an amendment to the contract between
said public agency and the Board of Administration of the Public Employees' Retirement System,
a copy of said amendment being attached hereto as an Exhibit and by this reference made a part
hereof.
PASSED, APPROVED, and ADOPTED by the City Council of the City of Palm Desert,
California, at its Regular Meeting held on the 11 th day of July , 2002, by the following vote,
to wit:
AYES: BENSON, CRITES, SPIEGEL, KELLY
NOES: NONE
ABSENT: FERGUSON
ABSTAIN: NONE
ATTEST:
RACHELLE D. KLASSEN, CITY CLERK
i
RICHARD S. KELLY, MAYOR
RESOLUTION NO. 02-79
I t
Ca1PERS
California
Public Employees' Retirement System
441010.
EXHIBIT
AMEN MENT TO CONTRACT
Between the
Board of Administration
California Public Employees' Retirement System
and the
City Council
City of Palm Desert
The Board of Administration, California Public Employees' Retirement System,
hereinafter referred to as Board, and the governing body of the above public
agency, hereinafter referred to as Public Agency, having entered into a contract
effective October 26, 1974, and witnessed October 3, 1974, and as amended
effective February 7, 1981, July 29, 1989, June 14, 1991 and June 30, 1996 which
provides for participation of Public Agency in said System, Board and Public
Agency hereby agree as follows:
A. Paragraphs 1 through 12 are hereby stricken from said contract as
executed effective June 30, 1996, and hereby replaced by the following
paragraphs numbered 1 through 12 inclusive:
1. All words and terms used herein which are defined in the Public
Employees' Retirement Law shall have the meaning as defined
therein unless otherwise specifically provided. "Normal retirement
age" shall mean age 55 for local miscellaneous members.
0.
RESOLUTION NO. 02-79
PLEASE DO NOT SIGN "EXHIBIT ONLY"
2. Public Agency shall participate in the Public Employees' Retirement
System from and after October 26, 1974 making its employees as
hereinafter provided, members of said System subject to all
provisions of the Public Employees' Retirement Law except such as
apply only on election of a contracting agency and are not provided
for herein and to all amendments to said Law hereafter enacted
except those, which by express provisions thereof, apply only on the
election of a contracting agency.
3. Employees of Public Agency in the following classes shall become
members of said Retirement System except such in each such class
as are excluded by law or this agreement:
a. Employees other than local safety members (herein referred
to as local miscellaneous members).
4. In addition to the classes of employees excluded from membership
by said Retirement Law, the following classes of employees ,shall not
become members of said Retirement System:
a. ALL SAFETY EMPLOYEES, AND
b. ALL EMPLOYEES AGE 65 OR OLDER ON CONTRACT
DATE.
5. Prior to January 1, 1975, those members who were hired by Public
Agency on a temporary and/or seasonal basis not to exceed 6
months were excluded from PERS membership by contract.
Government Code Section 20336 superseded this contract provision
by providing that any such temporary and/or seasonal employees
are excluded from. PERS membership subsequent to January 1,
1975. Legislation repealed and replaced said Section with
Government Code Section 20305 effective July 1, 1994.
6. The percentage of final compensation to be provided for each year of
credited prior and current service as a local miscellaneous member
shall be determined in accordance with Section 21354.5 of said
Retirement Law (2.7% at age 55 Full).
[Note that a future legislative proposal is being considered
which could amend Government Code Section 21354.5 to make
the 2.7% at 55 benefit formula applicable to both active
members and inactive members who have not yet retired. If
enacted, this amendment could have an effect on your agency's
actuarial valuation and employer contribution rates in future
years.]
RESOLUTION NO. 02-79
PLEASE DO NOT SIGN "EXHIBIT ONLY"
7 Public Agency elected and elects to
optional provisions:
a.
b.
c.
d.
e.
f.
9.
Sections 21624 and 21626
Allowance).
be subject to the following
(Post -Retirement Survivor
Section 21572 (Increased Level of 1959 Survivor Benefits).
Section 20965 (Credit for Unused Sick Leave).
Section 21151 (Industrial Disability Retirement For Local
Miscellaneous Members).
Section 21427 (Improved Nonindustrial Disability Allowance).
Section 20042 (One -Year Final Compensation).
Section 20503 (To Remove the Exclusions of "Crossing
Guards" and "Administrative Interns", Prospectively from June
14, 1991).
h. Section 20325 (Optional Membership for Part -Time
Employees).
8. Public Agency, in accordance with Government Code Section 20790,
ceased to be an "employer" for purposes of Section 20834 effective
on February 7, 1981. Accumulated contributions of Public Agency
shall be fixed and determined as provided in Government Code
Section 20834, and accumulated contributions thereafter shall be
held by the Board as provided in Government Code Section 20834.
9. Public Agency shall contribute to said Retirement System the
contributions determined by actuarial valuations of prior and future
service liability with respect to local miscellaneous members of said
Retirement System.
10. ' Public Agency shall also contribute to said Retirement System as
follows:
a. A reasonable amount, as fixed by the Board, payable in one
installment within 60 days of date of contract to cover the
costs of administering said System as it affects the employees
of Public Agency, not including the costs of special valuations
or of the periodic investigation and valuations required by law.
RESOLUTION NO. 02-79
B.
b. A reasonable amount, as fixed by the Board, payable in one
installment as the occasions arise, to cover the costs of
special valuations on account of employees of Public Agency,
and costs of the periodic investigation and valuations required
by law.
11. Contributions required of Public Agency and its employees shall be
subject to adjustment by Board on account of amendments to the
Public Employees' Retirement Law, and on account of the
experience under the Retirement System as determined by the
periodic investigation and valuation required by said Retirement Law.
12. Contributions required of Public Agency and its employees shall be
paid by Public Agency to the Retirement System within fifteen days
after the end of the period to which said contributions refer or as may
be prescribed by Board regulation. If more or less than the correct
amount of contributions is paid for any period, proper adjustment
shall be made in connection with subsequent remittances.
Adjustments on account of ors in contributions required of any
employee may be made byyi ect payments between the employee
and the Board.
This amendment shall bef€ettive on the
•
BOARD OF ADMINISTRATON
PUBLIC EMPLOYEES' RIREMENT SYSTEM
BY
KENNETH WAAARZION, CHIEF
ACTUARIAL & EMPLOYER SERVICES DIVISI
AMENDMENT
PERS-CON-702A (Rev. 8\96)
day of
CITY COUNCIL .
CITY OF PALM ,DE'RT
O
Witness Date
Attest:
Clerk
RESOLUTION NO. 02-79
A t,
CalPERS
Actuarial & Employer Services Division
P.O. Box 942709
Sacramento, CA 94229-2709
Telecommunications Device for the Deaf - (916) 326-3240
(916) 326-3420 FAX (916) 326-3005
July 2, 2002 Employer Code #1018
Reply to Section 105
Mr. Martin Pinon
Director of Human Resources
City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, CA 92260-2578
Dear Mr. Pinon:
Enclosed are two copies of the Resolution of Intention to amend the agency's contract
to provide Section 21354.5 (2.7% @ 55 Full formula) for local miscellaneous members.
You should be aware that a future legislative proposal is being considered to amend
Government Code Section 21354.5. This proposal could make the 2.7% at 55 formula
under Government Code Section 21354.5 applicable to both active members and
inactive members who have not yet retired. The cost analysis that was previously
provided to you assumes that the proposal will be enacted. If this proposal is not
enacted, changes in the cost will occur and will be reflected in the next valuation during
the normal annual rate setting process. If you have any questions or concerns, please
contact us before adopting this contract.
Also enclosed are the following documents:
1. Form CON-12, Certification of Governing Body's Action.
2. Form CON-12A, Certification of Compliance With Government Code Section
7507.
3. 2.7% @ 55 Formula Ballot.
4. Summary of Major Provisions (2.7% @ 55 Formula).
5. Form CON-15, Certification of Employee Election.
6. Form CON-11A, Sample Ordinance.
California Public Employees' Retirement System
LircoIn Plaza - 400 P Street - Sacramento, CA 95814
RESOLUTION NO. 02-79
City of Palm Desert
-2- July 2, 2002
The sample Ordinance is a guide only and is included to allow sufficient time to
prepare the Ordinance for a first and final reading. The Resolution of Intention and
accompanying documents should not be held pending final reading of the Ordinance.
Government Code Section 20474 requires a secret ballot election by the employees
affected whenever the contract is amended to provide a benefit which changes the
employees' rate of contribution. A ballot for the employees' election is enclosed. The
results of the election are to be certified on the enclosed Form CON-15, Certification of
Employee Election. The contract shall not be amended if a majority of the affected
members vote to disapprove the proposed plan.
Anv change in the employee or employer contribution rates will become effective as of
the effective date of the contract amendment.
The Contract Amendment Cost Analysis (actuarial valuation) information was based
on the most recent annual valuation and is good until the next annual valuation report
is sent to your agency. If your agency does not take action to amend its contract and
we have mailed the next annual valuation report to your agency, you must contact our
office for an updated cost analysis.
Disclosure of the cost of this Contract Amendment
The following costs for the adoption of this plan amendment are reflective of the Post -
Amendment Alternative #1 Option requested by the agency. We recommend that the
agency disclose these values identified in the amendment actuarial valuation for the
adoption of this plan amendment:
1) Change in the Present Value of Benefits (page 2) $ 5,520,580
2) Increase in Actuarial Value of Assets (page 2) $ 0
3) Change in the Unfunded Accrued Liability (page 3) $ 3,850,472
4) Change in the Total Employer Rate (page 4) 7.549%
Government Code Section 7507 requires that the future annual costs of the proposed
contract amendment be made public at a public meeting at least two weeks prior to the
adoption of the final Ordinance. The agency is to certify compliance on the enclosed
Certification of Compliance with Government Code Section 7507.
The local miscellaneous member contribution rate will be 8% of reportable earnings, as
of the effective date of the amendment to the contract.
RESOLUTION NO. 02-79
City of Palm Desert
-3- July 2, 2002
In summary, the following documents must be returned to this office before we can
forward the actual contract and other final documents necessary to complete the
proposed amendment. DO NOT HOLD THESE DOCUMENTS PENDING ADOPTION
OF THE FINAL ORDINANCE.
ORIGINAL SIGNATURES ARE REQUIRED
1. Resolution of Intention, original or certified copy.
2. Certification of Governing Body's Action (CON-12), original.
3. Certification of Compliance with Government Code Section 7507, (CON-12A),
original or certified copy.
4. Certification of Employee Election (CON-15).
If your agency adopts the Resolution of Intention on July 11, 2002, the earliest date the
final Ordinance may be adopted is July 31, 2002. There must be a 20 day period
between the adoption of the Resolution of Intention and the adoption of the final
Ordinance pursuant to Government Code Section 20471. THERE ARE NO
EXCEPTIONS TO THIS LAW.
The effective date of this amendment cannot be earlier than the first day of a payroll
period following the effective date of the final Ordinance.
Please do not retype the Amendment to Contract and/or agreement documents.
Only documents provided by this office will be accepted. If you have a problem
with any of the documents, please contact this office prior to presenting to your
governing body for adoption.
If you have any questions regarding this letter or the enclosed material, please do not
hesitate to contact me at (916) 326-3625.
Sincerely,
Ellie Wright
Employer Representative
Public Agency Contract Services
EW:jm
Enclosures
cc: San Bernardino Regional Office