City of Culver City, California
Agenda Item Report
Meeting Date: 12/12/2011 Item Number: C-8
CITY COUNCIL AGENDA ITEM: Adoption of Resolutions (1A) Approving Side
Letters of Agreement with the Culver City Employees Association and the Culver
City Management Group (1B) Amending the Culver City Executive Compensation
Plan; and (2) Rescinding Resolution Nos. 2011-041, 2011-056 and 2011-070
Contact Person/Dept.: Serena Wright Phone Number: 310-253-5640
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [] Action Item: [] Attachments: [X]
Commission Action Required: Yes [] No [X] Dates:
Public Notification: (E-Mail) Agenda and Meetings – City Council (12/08/11); Culver City
Employees Association (12/xx/2011); Culver City Management Group (12/08/2011)
Department Approval:
Serena Wright (12/08/11)
City Attorney Approval:
Carol Schwab (by H. Baker) (12/08/11)
Chief Financial Officer Approval:
Jeff Muir (12/08/11)
City Manager Approval:
John M. Nachbar (12/08/11)
RECOMMENDATION:
Staff recommends that the City Council adopt resolutions (1A) approving side letters
of agreement with the Culver City Employees Association and the Culver City
Management Group (1B) amending the Culver City Executive Compensation Plan;
and (2) Rescinding Resolution Nos. 2011-041, 2011-056 and 2011-070.
BACKGROUND:
The City Council recently approved and adopted successor Memoranda of
Understanding (MOU) with the Culver City Employees Association (CCEA) and the
Culver City Management Group (CCMG). In addition, the City Council formally
approved carving out the Culver City Executive Management employees from
CCMG and subsequently adopted a compensation plan outlining the wages, hours,
terms and conditions of employment for this new unrepresented group.
DISCUSSION:
The adopted CCEA MOU contains a “Me Too” clause which provides that if another
recognized Culver City bargaining unit receives an improved benefit in the areas of City of Culver City, California
Agenda Item Report
retiree medical and/or required PERS employee paid member contributions that
CCEA would be eligible to receive an equivalent benefit. Negotiations with the City’s
safety groups have resulted in adjustments being made in those areas. Therefore,
side letter agreements have been prepared which provide commensurate benefits to
fully satisfy the “Me Too” clause.
A summary of the proposed changes, as specified in the attached side letters of
agreement, include:
• Increasing the Cafeteria Plan allowance by $50;
• Deferring the final 3% (of the 8%) PERS employee paid member contribution
until 2013;
• Providing 2% special compensation; and
• Implementing a “Grandfather Clause” that will provide long tenured
employees with an unmodified retiree medical benefit
In order to maintain an equitable salary and compensation plan, these modifications
are also being proposed for CCMG and the Executive Management employees.
FISCAL ANALYSIS:
The cost of increasing the Cafeteria Plan allowance by $50 per month is
approximately $150,000 per year over the original agreements. Under the original
agreements, the estimated long-term savings from the employees in these groups
picking up their full share of the employee contribution to PERS was approximately
$1.1 million. The revised long-term savings, accounting for the 2% compensation
increase, is approximately $650,000 per year. Overall, the long-term estimated
savings related to current employees paying contributions towards their retirement
for all bargaining groups is approximately $1.5 million per year.
It is difficult to estimate the exact cost increase for providing the grandfather clause
for retiree medical benefits. During Fiscal Year 2011/2012 the City engaged an
actuary to complete a valuation of the City’s total liability for the existing retiree
medical benefit. Because the City is not currently doing any pre-funding of this
benefit, the liability for all current retirees and employees was calculated at over
$200 million, with a required annual contribution of over $11 million. Based on
current estimates, retiree medical benefit changes negotiated in the MOU’s reduce
the liability and required annual contribution amount by 20%. During the spring, a
new actuarial report will be completed to recalculate the City’s total liability.
ATTACHMENTS:
1. Resolution amending the Culver City Employees Association Memorandum of
Understanding with Exhibit A (the side letter of agreement)
City of Culver City, California
Agenda Item Report
2. Resolution amending the Culver City Management Group Memorandum of
Understanding with Exhibit A (the side letter of agreement)
3. Resolution amending the Culver City Executive Compensation Plan with
Exhibit A
MOTION:
That the City Council:
Adopt Resolutions (1a) approving Side Letters of Agreement with the Culver City
Employees Association and the Culver City Management Group (1b) Amending
the Culver City Executive Compensation Plan; and (2) rescinding Resolution
Nos. 2011-041, 2011-056 and 2011-070.
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MEETING DATE: 12/12/11
AGENDA ITEM: Adoption of Resolutions Approving a Side Letter of
Agreement with the Culver City Employees Association and the Culver City
Management Group; and Adoption of a Resolution Amending the Culver City
Executive Compensation Plan
ATTACHMENTS
Pages
1. Resolution amending the Culver City
Employees Association Memorandum of Understanding
with Exhibit A
2. Resolution amending the Culver City
Management Group Memorandum of Understanding
with Exhibit A
3. Resolution amending the Culver City Executive 9 - 11
Compensation Plan with Exhibit A I
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RESOLUTION NO. 2011-R
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF CULVER CITY, CALIFORNIA, APPROVING AND
ADOPTING A SIDE LETTER OF AGREEMENT WITH
THE CULVER CITY EMPLOYEES ASSOCIATION AND
RESCINDING RESOLUTION NO 2011-R070.
WHEREAS, the Culver City Employees Association (CCEA)
representatives and Culver City (City) representatives have met and conferred and
executed a "Master Memorandum of Understanding valid from July 1, 2011 through
June 30, 2013 (CCEA MOU); and,
WHEREAS, the City Council of the City of Culver City approved and
adopted the CCEA MOU on July 25, 2011; and,
WHEREAS, the City and CCEA have mutually agreed to amend the
CCEA MOU; and,
WHEREAS, representatives of the City and CCEA have met and
conferred in good faith and have reached tentative agreement on a Side Letter of
Agreement attached hereto as Exhibit A and made a part hereof.
NOW, THEREFORE, the City Council of the City of Culver City DOES
HEREBY RESOLVE AS FOLLOWS:
1. The City Manager is hereby authorized to execute and implement
the terms and conditions of the Side Letter of Agreement attached hereto as Exhibit A
and made a part hereof.
2. The City Manager and Chief Financiat Officer are authorized to
adjust the budget and the records of employees necessary to pay the salaries and
costs related to the terms of the Side Letter of Agreement.
-1- L A. SCHWAB, City Attorney
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3. Resolution No. 2011-R070 is hereby rescinded.
APPROVED and ADOPTED this day of 2011.
MICHEAL O'LEARY, MAYOR
City of Culver City, California
ATTEST:
MARTIN R. COLE, City Clerk
A11 -00809
-2- EXHIBIT A
SIDE LETTER OF AGREEMENT
between
CITY OF CULVER CITY
and
CULVER CITY EMPLOYEES ASSOCIATION
Representatives of the City of Culver City ("City") and the Culver City Employees Association
("CCEA") (collectively "Parties") have met and conferred and reached agreement on this Side Letter
of Agreement to the 2011 — 2013 Memorandum of Understanding ("MOU"). This • Side Letter of
Agreement is not intended to supersede any of the other terms and conditions of employment
contained in the MOU unless specifically mentioned herein. The Parties agree that this Side Letter of
Agreement fully satisfies the "Me Too" clauses referenced in Article Four, Section I (D) and Article
Four, Section E. The following provisions of this Side Letter of Agreement represent the mutual
understanding and consent of both parties.
L Article Two shall be amended to include that all unit employees hired prior to
November 1, 2011 shall receive 2% Longevity Incentive Pay effective the first pay
period after January 1, 2012.
2. Article Four, Section I (B) (1) shall be amended to reflect that unit employees shall be
responsible for payment of the final 3% of the 8% PERS employee contribution rate as
follows:
• 1.5% (for a total of 6.5%) shall be paid effective January 1, 2013
• 1_5% (for a total of 8%) shall be paid effective June 30, 2013
3. Article Four, Section II (B) shall be amended to reflect that effective January 1, 2012,
the Cafeteria Plan allowance will be increased as follows. The allowance is inclusive of
the Public Employees' Medical and Hospital Care Act (PEMHCA) statutory minimum.
* Employee only - $595.00
• Employee + 1 - $1,075.00
• Employee Family - $1,364.00
4. Article Four, Section 11(H) shall be amended to include the following clause:
Unit employees that, as of December 31, 2011, have twenty (20) or more years of
CalPERS service (excluding "Air Time") or, unit employees that retire by January 1,
2022 with twenty-five (25) years of Culver City service shall be eligible to receive 95%
of the monthly medical plan premium, for all plans except PERSCare, including
coverage for a spouse, registered domestic partner and/or any eligible dependent(s). For
3 EXHIBIT A
PERSCare, unit employees that, as of December 31, 2011, have twenty (20) or more
years of CalPERS service (excluding "Air Time") or, that retire by January 1, 2022 with
twenty-five (25) years of Culver City service shall be eligible to receive 70% of the
monthly medical plan premium, including coverage for a spouse, registered domestic
partner and/or any eligible dependent(s)
5. This Side Letter of Agreement shall be incorporated into and made part of the parties
Memorandum of Understanding for purposes of duration and contract enforcement.
This Side Letter of Agreement is executed on December 2011.
FOR THE CITY: FOR CCEA:
John M. Nachbar, City Manager Desmond Burns, President
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RESOLUTION NO. 2011-R
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF CULVER CITY, CALIFORNIA, APPROVING AND
ADOPTING A SIDE LETTER OF AGREEMENT WITH
THE CULVER CITY MANAGEMENT GROUP AND
RESCINDING RESOLUTION NO 2011-R041.
WHEREAS, the Culver City Management Group (GCMG) representatives
and Culver City (City) representatives have met and conferred and executed a "Master
Memorandum of Understanding" for the period of July 1, 2011 through June 30, 2013
(GCMG MOU); and,
WHEREAS, the City Council of the City of Culver City approved and
adopted the GCMG MOU on May 23, 2011; and,
WHEREAS, the City and CCMG have mutually agreed to amend the
GCMG MOU; and,
WHEREAS, representatives of the City and CCMG have met and
conferred in good faith and have reached tentative agreement on a Side Letter of
Agreement attached hereto as Exhibit A and made a part hereof.
NOW, THEREFORE, the City Council of the City of Culver City DOES
HEREBY RESOLVE AS FOLLOWS:
1. The City Manager is hereby authorized to execute and implement
the terms and conditions of the Side Letter of Agreement attached hereto as Exhibit A
and made a part hereof.
2. The City Manager and Chief Financial Officer are authorized to
adjust the budget and the records of employees necessary to pay the salaries and
costs related to the terms of the Side Letter of Agreement.
-1- 3_ Resolution No. 2011-041 is hereby rescinded.
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APPROVED and ADOPTED this day of 2011.
MICHEAL O'LEARY, MAYOR
City of Culver City, California
ATTEST: APPROVED AS TO FO
/
MARTIN R. COLE, City Clerk CAR- 6 -- L A. SCHWAB, City Attorney
Al 1 -00810
-2- EXHIBIT A
SIDE LETTER OF AGREEMENT
between
CITY OF CULVER CITY
and
CULVER CITY MANAGEMENT GROUP
Representatives of the City of Culver City ("City") and the Culver City Management Group
("CCMG") (collectively "Parties") have met and conferred and reached agreement on this Side Letter
of Agreement to the 2011 — 2013 Memorandum of Understanding ("MOU"). This Side Letter of
Agreement is not intended to supersede any of the other terms and conditions of employment
contained in the 1\40U unless specifically mentioned herein. The following provisions of this Side
Letter of Agreement represent the mutual understanding and consent of both parties.
1. Article Two shall be amended to include that all unit employees hired prior to
November 1, 2011 shall receive 2% Management Incentive Pay effective the first pay
period after January 1, 2012.
2. Article Four, Section I (B) (1) shall be amended to reflect that unit employees shall be
responsible for payment of the final 3% of the 8% PERS employee contribution rate as
follows:
• 1.5% (for a total of 6_5%) shall be paid effective January 1, 2013
• 1.5% (for a total of 8%) shall be paid effective June 30, 2013
3. Article Four, Section 171 (B) shall be amended to reflect that, effective January 1, 2012,
the Cafeteria Plan allowance will be increased as follows. The allowance is inclusive of
the Public Employees' Medical and Hospital Care Act (PEMBCA) statutory minimum.
• Employee only - $595.00
• Employee + 1 - $1,075.00
• Employee Family - $1,364.00
4. Article Four, Section 11 (IT) shall be amended to include the following clause:
Unit employees that, as of December 31, 2011, have twenty (20) or more years of
CalPERS service (excluding "Air Time") or, unit employees that retire by January 1,
2022 with twenty-five (25) years of Culver City service shall be eligible to receive 95%
of the monthly medical plan premium, for all plans except PERSCare, including
coverage for a spouse, registered domestic partner and/or any eligible dependent(s). For
PERSCare, unit employees that, as of December 31, 2011, have twenty (20) or more
years of CalPERS service (excluding "Air Time") or, that retire by January 1, 2022 with
1 EXHIBIT A
twenty-five (25) years of Culver City service shall be eligible to receive 70% of the
monthly medical plan premium, including coverage for a spouse, registered domestic
partner ancl/or any eligible dependent(s).
5. This Side Letter of Agreement shall be incorporated into and made part of the parties
Memorandum of Understanding for purposes of duration and contract enforcement.
This Side Letter of Agreement is executed on December 2011.
FOR THE CITY: FOR CCMG:
John M. Nachbar, City Manager Glenn Heald, President I
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RESOLUTION NO. 2011-R
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF CULVER CITY, CALIFORNIA, AMENDING THE
EXECUTIVE COMPENSATION PLAN AND
RESCINDING RESOLUTION NO 2011-R056.
WHEREAS, the City Council of the City of Culver City approved and
adopted an Executive Compensation Plan on June 13, 2011 that outlined the wages,
hours, terms and conditions of employment for the following unrepresented
classifications:
Assistant City Manager Assistant to City Manager
Chief Financial Officer Chief Information Officer
Community Development Director Human Resources Director
Parks, Recreation and Community Public Works Director/City Engineer
Services Director
Transportation Director
WHEREAS, the City Council of the City of Culver City wishes to amend
the Executive Compensation Plan attached hereto as Exhibit A and made a part
thereof.
NOW, THEREFORE, the City Council of the City of Culver City DOES
HEREBY RESOLVE AS FOLLOWS:
1. The City Manager is hereby authorized to execute and implement
the terms and conditions of the amended Executive Compensation Plan attached
hereto as Exhibit A and made a part hereof.
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a/40,7,.:111
4, 4
SCHWAB, City Attorney
ATTEST: APPROVED AS TQ FORM:
MARTIN R. COLE, City Clerk
Al 1-00808
2. The City Manager and Chief Financial Officer are hereby
authorized to adjust the budget and the records of employees necessary to pay the
salaries and costs related to the terms of the approved Executive Compensation Plan.
3. Resolution No. 2011-R056 is hereby rescinded.
APPROVED and ADOPTED this day of 2011.
MICHEAL O'LEARY, MAYOR
City of Culver City, California
-2-
10 EXHIBIT A
EXECUTIVE COMPENSATION PLAN
AMENDMENT NO.!
This Amendment to the Executive Compensation Plan (Plan) amends the following provisions and is
not intended to supersede any of the other terms and conditions of employment contained within the
Plan unless specifically mentioned herein.
1. Section HI shall be amended to include that all unit employees hired prior to November
1, 2011 shall receive 2% Management Incentive Pay effective the first pay period after
January 1, 2012.
2. Section V (B) shall be amended to reflect that unit employees shall be responsible for
payment of the final 3% of the 8% PERS employee contribution rate as follows:
• 1.5% (for a total of 6.5%) shall be paid effective January 1, 2013
• 1_5% (for a total of 8%) shall be paid effective June 30, 2013
3. Section VI (A) shall be amended to reflect that, effective January 1, 2012, the Cafeteria
Plan allowance will be increased as follows. The allowance is inclusive of the Public
Employees' Medical and Hospital Care Act (PEMTICA) statutory minimum_
• Employee only - $595.00
• Employee + 1 - $1,075.00
• Employee Family -$1,364.00
4. Section VI (G) shall be amended to include the following clause:
Unit employees that, as of December 31, 2011, have twenty (20) or more years of
CalPERS service (excluding "Air Time") or, unit employees that retire by January 1,
2022 with twenty-five (25) years of Culver City service shall be eligible to receive 95%
of the monthly medical plan premium, for all plans except PERSCare, including
coverage for a spouse, registered domestic partner and/or any eligible dependent(s). For
PERSCare, unit employees that, as of December 31, 2011, have twenty (20) or more
years of CalPERS service (excluding "Air Time") or, that retire by January 1, 2022 with
twenty-five (25) years of Culver City service shall be eligible to receive 70% of the
monthly medical plan premium, including coverage for a spouse, registered domestic
partner and/or any eligible dependent(s).
5. This Amendment shall be incorporated into and made part of the Executive
Compensation Plan for purposes of duration and contract enforcement.