Loading...
HomeMy WebLinkAbout12 - NB-2 - Side Letter Agreements CMFA and CMFMA - 9/4/2012CITY COUNCIL AGENDA REPORT MEETING DATE: September 4, 2012 ITEM NUMBER: SUBJECT: SIDE LETTER OF AGREEMENT TO THE JULY 1, 2007 TO JUNE 30, 2013 MEMORANDUM OF UNDERSTANDING BETWEEN THE COSTA MESA FIREFIGHTERS ASSOCIATION AND THE CITY OF COSTA MESA AND SIDE LETTER OF AGREEMENT TO THE OCTOBER 26, 2010 —JUNE 30, 2014 BETWEEN THE COSTA MESA FIRE MANAGEMENT ASSOCIATION AND THE CITY OF COSTA MESA. DATE: AUGUST 15, 2012 FROM: CEO/HUMAN RESOURCES PRESENTATION RICHARD FRANCIS, ASSISTANT CHIEF EXECUTIVE OFFICER BY: FOR FURTHER INFORMATION CONTACT: RICHARD FRANCIS, AT (714) 754-5688 RECOMMENDATION: Staff recommends that the City Council: Approve and adopt the Side Letter of Agreement (LOA) (Attachment A) with the Costa Mesa Firefighters Association (CMFA) thereby amending certain portions of the 2007-2013 Memorandum of Understanding (as modified by the October 20, 2010 Side Letter of Agreement) between the Costa Mesa Firefighters Association and the City; and 2. Approve and adopt the Side Letter of Agreement (LOA) (Attachment B) with the Costa Mesa Fire Management Association (CMFMA) thereby amending certain portions of the October 26, 2010 — June 30, 2014 Letter of Agreement between the Costa Mesa Fire Management Association and the City. BACKGROUND: The City's Chief Negotiator and Negotiating Team have been meeting with the representatives of CMFA and CMFMA to discuss implementing a second tier retirement system, staffing levels and other items related to wages, hours, terms and conditions of employment. Specifically, these discussions have focused on two (2) key areas: (1) CalPERS retirement, second tier 2%@50 and (2) staffing levels as they relate to minimum staffing. Although the CMFA and CMFMA were not obligated to meet with the City to discuss the aforementioned items, they did agree to the concessions as stated and presented on each of their respective Side Letter of Agreement (Attachments A & B). The following are key highlights of the respective Side Letters: Costa Mesa Fire Association (CMF 1. Current employees covered by this agreement shall contribute 5% of the employee's PERSable earnings towards their employee retirement contribution through June 30, 2017. This contribution will begin retroactive to the pay period beginning July 1, 2012. 2. The City will implement the 2%@50 CalPERS Benefit Formula for new employees. New employees covered by the 2%@50 CalPERS Benefit Formula shall contribute 9% of the employee's PERSable earnings towards their employee retirement contribution. 3. Suspension of the RHS (Retirement Health Savings) Program - neither employee nor employer provides 1 % retiree medical funding through June 30, 2017. 4. Through and including June 30, 2017, there shall be no base salary adjustments. 5. Staffing level — minimum staffing of Article 12.1 is null and void and to be replaced by Fire Department Operational Restructuring document (Exhibit A of Attachment A) prepared by the Fire Chief. 6. The there shall be no extension of the CMFA MOU expiring on June 30, 2014. Costa Mesa Fire Management Association (CM FMA) 1. Current employees covered by this agreement shall continue contributing 5% of the employee's PERSable earnings towards their employee retirement contribution through June 30, 2017. This contribution will begin retroactive to the pay period beginning July 1, 2012. 2. The City will implement the 2%@50 CalPERS Benefit Formula for new employees. New employees covered by the 2%@50 CalPERS Benefit Formula shall contribute 9% of the employee's PERSable earnings towards their employee retirement contribution. 3. Suspension of the RHS (Retirement Health Savings) Program -neither employee nor employer provides 1 % retiree medical funding through June 30, 2017. 4. Through and including June 30, 2017, there shall be no base salary adjustments. 5. Staffing level — minimum staffing is null and void and to be replaced by Fire Department Operational Restructuring document (Exhibit A of Attachment B) prepared by the Fire Chief. 6. The City's contribution towards employees' medical and health care benefit frozen at the 2010 level shall continue to be frozen for calendar year 2013. If the City Council approves the agreement, staff will begin the process to implement the second tier retirement formula with PERS. ALTERNATIVES CONSIDERED Based upon the direction from City Council to the City's Negotiating Team, no other alternatives were considered. Reductions totaling $420,000 are being presented for City Council approval. E FISCAL REVIEW Based on the agreement, the payment of five percent (5%) by the employees towards the City's PERS retirement cost will produce an annual fiscal savings of approximately $420,000. It is anticipated that the reduced retirement benefit (2%@50) for new employees will produce a savings compared to hiring new employees at the current benefit (3%@50). CalPERS has communicated that the City's rates could be reduced by approximately 3.5% as the City hires new employees at the new benefit rate. Also, the agreement to forgo any salary increases through June 2017 would also produce a savings if the City was required to provide a salary increase, however those savings can not be determined at this time. While it is anticipated the Fire Department Operational Restructuring Plan will result in cost savings, at this point in time, it is difficult to specifically identify the precise cost savings. However, after the final plan has been determined and before implementation, a comprehensive cost benefit analysis will be provided. LEGAL REVIEW The City Attorney's Office has reviewed the attached documents and, where appropriate, approved them as to form. CONCLUSION City Council approval and adoption of the agreements is needed at this meeting so staff can implement the agreed upon items to the existing CMFA Memorandum of Understanding/Letter of Agreement and CMFMA Letter of Agreement. LANCE M. NAKAMOTO Human Resources Manager BOBBY YOUNG Director of Finance and I.T. DISTRIBUTION: Chief Executive Officer City Attorney City Clerk RICHARD FRANCIS Assistant Chief Executive Officer TOM DUARTE City Attorney 3 Attachments: (A) Side Letter of Agreement Between the Costa Mesa Firefighters Association (CMFA) and the City of Costa Mesa. (B) Side Letter of Agreement Between the Costa Mesa Fire Management Association (CMFMA) and the City of Costa Mesa. n ATTACHMENT A AMENDMENT TO 2007-2013 MEMORANDUM OF UNDERSTANDING BETWEEN REPRESENTATIVES OF THE COSTA MESA FIREFIGHTERS ASSOCIATION AND THE CITY OF COSTA MESA (AS MODIFIED BY THE OCTOBER 20, 2010 SIDE LETTER OF AGREEMENT) This AMENDMENT to the 2007-2013 Memorandum of Understanding between representatives of the Costa Mesa Firefighter Association and the City of Costa Mesa (as modified by the October 20, 2010 Side Letter of Agreement) shall take precedence over any and all conflicting provisions within the 2007-2013 MOU and/or the October 20, 2010 Side Letter of Agreement. Unless otherwise indicated all provisions of this AMENDMENT shall be effective concurrent with City Council adoption of the AMENDMENT. HOWEVER, THIS AMENDMENT SHALL BE OF NO FORCE OR EFFECT UNLESS AND UNTIL ADOPTED BY THE CITY COUNCIL. Representatives of the Costa Mesa Firefighters Association and the City of Costa Mesa having met and conferred in good faith, do now agree as follows: 1. Article 2 — TERM OF AGREEMENT — there shall be no extension of the MOU expiring on June 30, 2014. Unless specifically addressed to the contrary in this AMENDMENT, any and all matters within the scope of representation, including those within the MOU expiring on June 30, 2014, shall be subject to modification on and after July 1, 2014, subject to completion of the meet and confer process and any related impasse proceedings. 2. Article 3 — BASIC SALARIES AND WAGES — through and including June 30, 2017, there shall be no base salary adjustments, and/or there shall be no "salary adjustments" as that term is used in MOU Article 3 or as provided for in MOU Articles 3.2 and/or 3.3 Phase I and/or the October 20, 2010 Side Letter of Agreement. Further, Article 3.3 Phase I shall be null and void and stricken from the MOU. 3. Article 6 — RETIREMENT — MOU Article 6.1 Ca1PERS shall be amended to provide that all unit safety members hired on and after City Council adoption of this AMENDMENT and the effective date of necessary CalPERS contract AMENDMENTS, shall be enrolled in the Government Code § 21362 "2% @ 50" pension benefit formula. As is provided for in Government Code § 20037, said employees who shall be enrolled in the "2% @ 50" pension benefit formula, shall have "final compensation" determined by computation of the highest average annual compensation earnable by the member during any period of three consecutive years of employment preceding the effective date of the employee's retirement. Page 1 of 4 Pursuant to Government Code § 20691, each unit safety member subject to enrollment in the "2% @ 50" pension benefit formula shall be individually responsible for contributing 100% of the normal rate of employee PERS contribution mandated by Government Code § 20678, as it may from time to time provide. There will be no Employer Paid Member Contribution (EPMC) under the "2% at 50" pension benefit formula. With the exception of the Government Code § 20965 UNUSED SICK LEAVE SERVICE CREDIT and any optional post-retirement survivor allowances provided for in Government Code § 21624 or otherwise, said unit safety members enrolled in the "2% @ 50" pension benefit formula shall be subject to the CalPERS options described in Section 6.3 of the MOU, to the extent that any such option is not contrary to the provisions of this AMENDMENT and/or is otherwise not made available by CalPERS to unit safety members enrolled in the "2% @ 50" pension benefit formula. Effective .retroactive to July 1, 2012, those unit safety members employed prior to the effective date of the "2% @ 50" pension benefit formula and who are subject to the Government Code § 21362.2 "3% @ 50" pension benefit formula, shall be individually responsible for contributing 5% of "compensation earnable" to the normal rate of local safety member contribution to CalPERS. This contribution shall be made pursuant to the City's existing Government Code § 20516(a) cost sharing contract or Government Code § 20516(f) if Ca1PERS requires the cost sharing to be made pursuant to subsection (f). The City will continue to pay and report the value of the Employer Paid Member Contribution (EPMC) at 9% for those unit safety members employed prior to the effective date of the "2% at 50" pension benefit formula. Absent a state law mandate requiring a modification to the amount of individual -funded payment of normal rates of retirement benefit contributions, the above member contribution provisions shall not be subject to modification prior to June 30, 2017. This AMENDMENT and the MOU shall be subject to a reopener confined to addressing any state law mandates becoming effective during the term of the AMENDMENT and MOU and which impact any aspect of the pension benefits/funding as are applicable to any unit members. The resultant meet and confer process shall be a good faith process by which to address in all or part, the offsetting of a reduction in compensation resulting from the aforesaid statutory mandate(s). As with any Page 2 of 4 Government Code § 3500 et. seq. meet and confer process, an agreement in the above regard is not mandated. 4. Article 12 — STAFFING LEVELS — the provisions of MOU Article 12.1 shall in their entirety be null and void and stricken from the MOU. Article 12.1 shall be replaced by Exhibit A to this AMENDMENT, a document entitled FIRE DEPARTMENT OPERATIONAL RESTRUCTURING. Any and/or all provisions in Exhibit A shall be subject to change based upon concurrence of the Fire Chief and the Chief Executive Officer. Although the Fire Chief and/or Chief Executive Officer shall solicit and consider Association perspectives regarding any such contemplated change, the solicitation and consideration of Association perspectives shall not be governed by the requirements of Government Code § 3500 et. seq., the Meyers-Milias-Brown Act. Therefore, the Association clearly, knowingly, and unequivocally waives it rights to engage in the meet and confer process as a condition precedent to any change in the Exhibit A. As regards unit members employed prior to City Council adoption of this AMENDMENT, through and including June 30, 2017, there shall be no layoff. This provision shall be of no force or effect on and after July 1, 2017. Through and including June 30, 2017, any City contracting with a third parry (public sector) for provision of any or all functions presently performed by City employees occupying classifications represented by the Costa Mesa Firefighters Association, shall not result in the layoff of any unit member employed prior to City Council adoption of this AMENDMENT. This provision shall be of no force or effect on and after July 1, 2017. Further, through and including June 30, 2017, the Costa Mesa Fire Department shall remain operational as a department of the City. 5. WORK SCHEDULE — attached to this AMENDMENT as Exhibit B is an exemplar of the 56 hour work week schedule that shall not be subject to modification prior to July 1, 2017. (The 56 hour work week is based on 24 hour shifts.) This provision shall not prevent shift/assignment changes impacting the actual days of the week that any unit member works. 6. Article 7 — RETIREE MEDICAL PROGRAMS — MOU Article 7.1 RETIREMENT HEALTH SAVINGS PLAN shall be suspended, resulting in a suspension of the MOU Article 7.1 mandated I% employee and I% Page 3 of 4 City contributions to the plan. Accordingly, there shall be a suspension of the payroll deduction of the I% former employee mandated contribution. If permitted by any applicable statute or regulation, any future City funding of the Retirement Health Savings Plan shall terminate. If not permitted by applicable statute, the City shall have the option of either: 1) dissolving the Plan or 2) suspending any and all City funding of the Plan without time limitation. 7. Any provisions of this AMENDMENT which specifically provide for a matter within the scope of representation remaining unchanged through June 30, 2017, shall be subject to modification thereafter by means of the meet and confer process and any then -applicable impasse resolution proceedings, unless it is also provided that the particular provision shall be of no force or effect on or after July 1, 2017, in which case the terms and conditions of employment existing prior to this AMENDMENT, shall be reinstated effective July 1, 2017. AGREED: Costa Me6a Firefighters Association City of Costa Mesa __ Date L-3 ,-9\o . 9 Date Page 4 of 4 EXHIBIT "A" August 14, 2012 CITY OF • . MESA FIRE DEPARTMENT INTEROFFICE MEMORANDUM TO: THOMAS R. HATCH, CHIEF EXECUTIVE OFFICER FROM: TOM ARNOLD, INTERIM FIRE CHIEF DATE: July 6, 2012 (revised August 10, 2012) SUBJECT: FIRE DEPARTMENT OPERATIONAL RESTRUCTURING Background On May 17, 2012, 1 presented a proposal to the City Council that restructures the way the Fire Department provides service to the community. This memo outlines the proposal and the steps necessary to implement it. In my conclusion, I stated that this proposal will: • Increase the number of response units • Increase the availability of units • Improve response times • Increase service to community • Reduce the number of fire operations personnel from 87 to 81 Proposal Details • Consider closing Metro fire station 6 at 3350 Sakioka Drive • Place 1 fire unit & 1 fire ambulance in each of the remaining 5 stations • Staff 4 engine companies with one fire captain, one fire engineer, & one firefighter each • Staff 1 quint style truck company with one fire captain, 2 fire engineers, & 1 firefighter • Staff 5 fire ambulances with 2 firefighter paramedics each • Staff 1 command unit with 1 fire battalion chief Unit Placement Royal Palm station 1 Baker Street station 2 Park Avenue station 3 Placentia station 4 For the Firefighters Association Date: Tim Vasin 2803 Royal Palm Drive 800 Baker Street 1865 Park Avenue 2300 Placentia Avenue Pagel of 2 1 engine company 1 engine company 1 engine company 1 engine company 1 fire ambulance 1 fire ambulance 1 fire ambulance 1 fire ambulance For the City Date: Tom Hatch EXHIBIT "A" August 14, 2012 Civic Center station 5 2450 Vanguard Way 1 truck company 1 fire ambulance 1 command unit Total fire personnel per shift - 27 Capital Outlay Requirements • Purchase 7 ambulances (5 frontline, 2 reserves) • Purchase equipment required for ambulances • Retrofit existing ladder truck with a fire pump and water tank • Modify Civic Center station 5 to accommodate the quint style truck company and command unit Page 2 of 2 For the Firefighters Association Date: Tim Vasin For the City Date: Tom Hatch z V N6 z in W W EXHIBIT B UJ v- CM 00 T- N �° " N CM U)N t® Ixi® F® CM m CM N 0 " CM CM w N w (i) iCM N (n CM (n cm Chi " CM M (/) to N 00 w r- Ile LL Cil C}7CM N LL Cil N MLL AG i® NN T-7' m CO w CMCM w ' r Q CM 5M �l e® Cil > CM cg Of � i ® � � �� �c �v- U) qeT-00� ��00��� Cl) C\lcl) v- CM CM'eT-00U) ':T 7- ���T-CM (nw��� LL ® � V LL LO cm 0) LL to N 0) (D a Hcm o) to mCM H I- W 00 LO Lu CM eo W F- � %- CO LO cq ® F® Cil CP m 0 CMM �T-�� �T-r-� �co"CMS cn LO r-� U) ��CM CM CM cn �- "CMS �7-� 7-�CM 99 � �Cma)"CMM LU �� m CD a ���v-CMN a �T- 00 LO 9��®"CMM WF T- � cm 0 "CMM C V- CM ���T-� N T-CMCM U) CMC� T- NCO ATTACHMENT B AMENDMENT TO OCTOBER 26,2010 -JUNE 30, 2014 LETTER OF AGREEMENT BETWEEN THE COSTA MESA FIRE MANAGEMENT ASSOCIATION AND THE CITY OF COSTA MESA This AMENDMENT to the October 26, 2010 -June 30, 2014 LETTER OF AGREEMENT between representatives of the Costa Mesa Fire Management Association and the City of Costa Mesa shall take precedence over any and all conflicting provisions within said Letter of Agreement or within any City Council approved Resolution or conflicting past practices within the scope of representation. Unless otherwise indicated, all provisions of this AMENDMENT shall be effective concurrent with City Council adoption of the AMENDMENT. HOWEVER, THIS AMENDMENT SHALL BE OF NO FORCE OR EFFECT UNLESS AND UNTIL ADOPTED BY THE CITY COUNCIL. Representatives of the Costa Mesa Fire Management Association and the City of Costa Mesa having met and conferred in good faith, do now agree as follows: 1. ARTICLE 2 — TERM OF LETTER OF AGREEMENT — there shall be no extension of the LETTER OF AGREEMENT expiring on June 30, 2014. Unless specifically addressed to the contrary in this AMENDMENT, any and all matters within the scope of representation, including those within the LETTER OF AGREEMENT, shall be subject to modification on and after July 1, 2014, subject to completion of the meet and confer process and any related impasse proceedings. 2. BASIC SALARIES AND WAGES — through and including June 30, 2017, there shall be no base salary adjustments, and/or there shall be no "salary adjustments" as that term is used in LETTER OF AGREEMENT ARTICLE VII. 3. ARTICLE II — RETIREMENT — The LETTER OF AGREEMENT shall be amended to provide that all unit safety members hired on and after City Council adoption of this AMENDMENT and the effective date of necessary Ca1PERS contract AMENDMENTS, shall be enrolled in the Government Code § 21362 "2% @ 50" pension benefit formula. As is provided for in Government Code § 20037, said employees who shall be enrolled in the "2% @ 50" pension benefit formula, shall have "final compensation" determined by computation of the highest average annual compensation earnable by the member during any period of three consecutive years of employment preceding the effective date of the employee's retirement. Pursuant to Government Code § 20691, each unit safety member subject to enrollment in the "2% @ 50" pension benefit formula shall be individually responsible for contributing 100% of the normal rate of Page 1 of 3 employee PERS contribution mandated by Government Code § 20678, as it may from time to time provide. There will be no Employer Paid Member Contribution (EPMC) under the "2% at 50" pension benefit formula. With the exception of any optional post-retirement survivor allowances provided for in Government Code § 21624 or otherwise, said unit safety members enrolled in the "2% @ 50" pension benefit formula shall be subject to the Ca1PERS options described in Section 6.3 of the LETTER OF AGREEMENT, to the extent that any such option is not contrary to the provisions of this AMENDMENT and/or is otherwise not made available by CalPERS to unit safety members enrolled in the "2% @ 50" pension benefit formula. Through and including June 30, 2017, unit safety members employed prior to the effective date of the "2% @ 50" pension benefit formula and who are subject to the Government Code § 21362.2 "3% @ 50" pension benefit formula, shall be individually responsible for contributing 5% of "compensation earnable" to the normal rate of local safety member contribution to Ca1PERS. This contribution shall be made pursuant to the City's existing Government Code § 20516 cost sharing contract. The City will continue to pay and report the value of the Employer Paid Member Contribution (EPMC) at 9% for those unit safety members employed prior to the effective date of the "2% at 50" pension benefit formula. Absent a state law mandate requiring a modification to the aLETTER OF AGREEMENTnt of individual -funded payment of normal rates of retirement benefit contributions, the above member contribution provisions shall not be subject to modification prior to June 30, 2017. This AMENDMENT shall be subject to a reopener confined to addressing any state law mandates becoming effective during the term of the AMENDMENT and which impact any aspect of the pension benefits/funding as are applicable to any unit members. The resultant meet and confer process shall be a good faith process by which to address in all or part, the offsetting of a reduction in compensation resulting from the aforesaid statutory mandate(s). As with any Government Code § 3500 et. seq. meet and confer process, an agreement in the above regard is not mandated. 4. LAYOFFS/CONTRACTING - As regards unit members employed prior to City Council adoption of this AMENDMENT, through and including June 30, 2017, there shall be no layoff. This provision shall be of no force or effect on and after July 1, 2017. Page 2 of 3 Through and including June 30, 2017, any City contracting with a third party (public sector) for provision of any or all functions presently performed by City employees occupying classifications represented by the Costa Mesa Fire Management Association, shall not result in the layoff of any unit member employed prior to City Council adoption of this AMENDMENT. This provision shall be of no force or effect on and after July 1, 2017. Further, through and including June 30, 2017, the Costa Mesa Fire Department shall remain operational as a department of the City. 5. WORK SCHEDULE — attached to this ADMENDMENT as Exhibit A is an example of the 56 -hour work schedule that shall not be subject to modification prior to July 1, 2017. (The 56 hour work week is based upon 24 hour shifts). At the sole discretion of the Fire Chief with concurrence by the City's Chief Executive Officer, one unit member can be assigned to a forty (40) hour per week administrative assignment. 6. ARTICLE III — RETIREE MEDICAL PROGRAM — RETIREMENT HEALTH SAVINGS PLAN shall be suspended indefinitely, resulting in a suspension of the mandated 1 % employee and I% City contributions to the plan. Accordingly, there shall be a suspension of the payroll deduction of the I% former employee mandated contribution. If permitted by any applicable statute or regulation, any future City funding of the Retirement Health Savings Plan shall terminate. If not permitted by applicable statute, the City shall have the option of either: 1) dissolving the Plan or 2) suspending any and all City funding of the Plan without time limitation. 7. ARTICLE VIII — the City's contribution towards employees' medical and health care benefits shall be frozen at the 2010 level for calendar years 2011, 2012 and 2013. AGREED: Costa Mesa Fire Management Association Date rty of Costa Mesa Date Page 3 of 3 r EXHIBIT A Cl) F-- l` r M Cn r co LO U) r CO LO CV 0) r CV CM r CM r N CV U- w N CM LL T- M le N CM Chid 1-- asi 04 T- G° F® Cl) N CM M m Cq a eo LO N r LO C CM � CM LU r0 N F- co 0 Ile 4� � "T r LU � � r CO LO T r r N v- CM M r N CM r N M cn r00 Lo (n � � C� T- CD cv CM M IL CM o) (D CO CD v„ co co ® F° LL cm w co CO CD r r N r CM M Ix _ LOCMw r CM 04 f— cvweo r r CM LuLONCD CM cV co Ln LU 5CM �� > CM � � �c'a®� h�0 4e OF— �c�®P- I-cmcm T- CM Zi CM CM Lo N '� M cn CO LO cn LOcmm U)r r00LO r r CM r N N r CM T- an 7- co T- CM CM iLm®P- Re U. LOCMo U. mw rrCM rCMCM r T- CM �t—c•,mF �� W����toCM 4 m CM� �'T- CMcm O CMM Lu a— 'CM � ® t— cm m CM U) T- T- N cn � CM N �° � Co cn - SNC cn T- CM cn CMCM CM N �� r CM N y F, LO cm w to cor ® t- l r LU H m 0 P- r r cM r CM CO m r CM CM W Lncit Z r CM C14 CO rCM 1® c� d° r r CM Lu Fm ° �r r Go `n N r C*! Cf r C*1 CM N r � a c � CV)N T- le ��oo7-CM 7 -CMC Cl) C�0)T-CM�