HomeMy WebLinkAbout15 - NB-4 - Voluntary Executive CalPers Contribution - 2/7/2012CITY COUNCIL AGENDA REPORT
MEETING DATE: February 7, 2012 ITEM NUMBER:
SUBJECT: VOLUNTARY EXECUTIVE CALIPERS CONTRIBUTION
DATE: JANUARY 25, 2012
FROM: CEO's OFFICE/HUMAN RESOURCES DIVISION
PRESENTATION BY: LANCE M. NAKAMOTO, HUMAN RESOURCES MANAGER
FOR FURTHER INFORMATION CONTACT: LANCE NAKAMOTO, AT (714) 754-5172
RECOMMENDATION:
Staff recommends that the City Council adopt the attached Resolution # 12-xx amending
Resolution #10-73 to approve an additional 1.949% voluntary contribution of currently
employed At -Will Executives funding their employee CalPERS retirement contribution.
DISCUSSION:
At -Will Executive Management miscellaneous employees have volunteered to pay an additional
1.949% the statutorily maximum amount (10.469%). Currently, non -sworn executive employees
are paying 31.49% of their total pension costs, by voluntarily agreeing to pay the statutorily
maximum employee amount, this figure will increase to 39%. The Chief of Police has also
agreed to contribute an additional 2% of his individual compensation to fund his CalPERS
retirement, resulting in his CalPERS funding to 7% of compensation. Effective the first payroll
period commencing in February, 2013, the Chief of Police by individual agreement shall increase
his contribution an additional 2% for a total of 9%. Effective the first payroll period commencing in
February 2014, the Chief of Police by individual agreement shall increase his contribution an
additional 1.5% for a total of 10.5%. A prospective new Fire Chief will immediately begin paying
100% of his/her maximum allowable employee member contribution costs.
The City is currently in the process of amending the existing CalPERS contract to the lower level
2%@60 formula for miscellaneous. Newly hired miscellaneous employees to the City's
Executive Team will pay the statutorily maximum amount into the second tier retirement formula
(2%@60).
ALTERNATIVES CONSIDERED:
The alternative is that the City Council could not approve the resolution. This would result in
these executives continuing to contribute 8.52% of their pension costs.
FISCAL REVIEW:
The implementation of this Agreement with At -Will Executive Management will provide an
annual savings to the City of approximately $50,000. This amount includes expected
contributions made by a prospective full time Fire Chief.
LEGAL REVIEW:
The City Attorney's Office has reviewed the attached documents and, where appropriate,
approved them as to form.
CONCLUSION:
In order to reduce the City's employee retirement costs, the City's Executive Leadership has
voluntarily demonstrated their commitment to pension reform.
LANCE M. NAKAMOTO
Human Resources Manager
BOBBY YOUNG
Director of Finance and I.T.
TAMARA S. LETOURNEAU
Interim Asst. Chief Executive Officer
THOMAS DUARTE
City Attorney
DISTRIBUTION: Chief Executive Officer
City Clerk
ATTACHMENTS: 1 020712 Resolution #12 — Voluntary Executive CaIPERS
Contribution
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ATTACHMENT I
RESOLUTION NO. 12-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
COSTA MESA, CALIFORNIA, APPROVING VOLUNTARY
EMPLOYEE CALPERS RETIREMENT CONTRIBUTIONS FOR
FULL-TIME UNREPRESENTED EXECUTIVE CITY EMPLOYEES.
THE CITY COUNCIL OF THE CITY OF COSTA MESA HEREBY RESOLVES AS
FOLLOWS:
WHEREAS, Unrepresented Executives (miscellaneous) presently contribute the
maximum allowed 2.469% CalPERS cost sharing and are already contributing an
additional 6.051 % of employee compensation to fund their retirement plan.
WHEREAS, Executive Managers (miscellaneous) seek to individually fund the
maximum employee contribution to CalPERS that is allowable by law, and whereas that
amount is presently 2.469% for employee sharing of employer CalPERS contributions
and an additional 8% employee funding of the statutorily allowable individual employee
contribution to CalPERS.
WHEREAS, the Chief of Police (safety) presently contributes 5% CalPERS cost
sharing and seeks to increase the employee contribution to CalPERS by 2% to fund his
retirement plan.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF
COSTA MESA that upon the declaration by Council Resolution as follows:
SECTION 1. In addition to the maximum allowed 2.469% employee sharing of
employer CalPERS cost, Unrepresented Executive employees (miscellaneous) shall by
their individual agreements contribute 8% of their individual compensation to fund their
CalPERS benefit, resulting in individual Unrepresented Executives (miscellaneous)
CalPERS funding to be 10.469% of compensation.
SECTION 2. The Chief of Police by individual agreement shall contribute an
additional 2% of his individual compensation to fund his CalPERS benefit, resulting in
his CalPERS funding to 7% of compensation effective February 12, 2012. Effective the
first payroll period commencing in February, 2013, the Chief of Police by individual
agreement shall increase his contribution an additional 2% for a total of 9%. Effective
the first payroll period commencing in February 2014, the Chief of Police by individual
agreement shall increase his contribution an additional 1.5% for a total of 10.5°/x.
SECTION 3. Upon hire, newly appointed Unrepresented Executives shall pay 100%
of the maximum allowable employee member retirement contribution, as that amount
may from time -to -time exist by statute.
ATTACHMENT
The effective date for the above additional employee contributions shall be
February 12, 2012.
PASSED AND ADOPTED this 7t" day of February, 2012.
ATTEST:
Gary Monahan, Mayor
APPROVED AS TO FORM
Julie Folcik, City Clerk Tom Duarte, City Attorney
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss
CITY OF COSTA MESA )
I, JULIE FOLICK, City Clerk of the City of Costa Mesa, DO HEREBY CERTIFY that the
above and foregoing is the original of Resolution No. 12- and was duly passed
and adopted by the City Council of the City of Costa Mesa at a regular meeting held on
the 7t" day of February, 2012 by the following roll call vote to wit:
AYES:
COUNCIL MEMBERS:
NOES:
COUNCIL MEMBERS:
ABSENT:
COUNCIL MEMBERS:
IN WITNESS WHEREOF, I have hereby set my hand and affixed the seal of the
City of Costa Mesa this 8t" day of February, 2012.
JULIE FOLCIK, CITY CLERK
(SEAL)