City of Culver City, California
City Council Agenda Item Report
RECOMMENDATION:
Staff recommends the City Council (1) adopt a Resolution (a) providing additional
service credit pursuant to Government Code Section 20903 for Local Miscellaneous
Members of the California Public Employees Retirement System (CalPERS); (b)
Designating the Window Period as June 8, 2010 to September 8, 2010; and (c)
Specifying the Eligible Group of Members; and (2) authorize the Mayor to execute
the Certification of Compliance with Government Code Section 20903.
BACKGROUND:
At the May 24, 2010 City Council meeting, the City Council considered information in
accordance with Government Code Section 7507 regarding the potential costs and
savings related to the elimination of positions through the CalPERS Early Retirement
Incentive Program. The item was considered as an action item, with an opportunity
for members of the public to provide comment. As mentioned at that time, the
second step of the process is for the City Council to adopt a resolution which: (1)
provides additional service credit pursuant to Government Code Section 20903 for
Local Miscellaneous Members of CalPERS; (2) designates the Window Period; and
(3) specifies the Eligible Group of Members.
Meeting Date: 6/07/10 Item Number: A-2
AGENDA ITEM: (1) Adoption of a Resolution (a) Providing Additional Service
Credit Pursuant to Government Code Section 20903 for Local Miscellaneous
Members of the California Public Employees Retirement System (CalPERS); (b)
Designating the Window Period as June 8, 2010 to September 8, 2010; and (c)
Specifying the Eligible Group of Members; and (2) Authorize the Mayor to Execute
the Certification of Compliance with Government Code Section 20903.
Contact Person/Dept.: Serena Wright Phone Number: (310) 253-5640
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [] Action Item: [X] Attachments: [X]
Public Notification: (E-Mail) Meetings and Agendas – City Council (06/02/10),
Culver City Employees Association (06/02/10)
Department Approval:
Serena Wright (06/01/10)
City Attorney Approval:
Carol Schwab (by H. Baker) (06/02/10)
Chief Financial Officer Approval:
Jeff Muir (by M. Noller) (06/02/10)
City Manager Approval:
P. Lamont Ewell (06/02/10) City of Culver City, California
City Council Agenda Item Report
DISCUSSION:
In accordance with the Public Employees Retirement Law, two years of additional
service credit may be offered to employees who have at least five years of CalPERS
service and meet the minimum age requirement for a service retirement.
Additionally, an agency must be facing impending mandatory transfers, demotions or
layoffs that constitute at least 1 percent (1%) of the job classification, department or
organizational unit, as designated by the City. Further, the City must certify that it
intends to keep all vacancies created by retirements under this program or at least
one vacancy in any position in any department or organizational unit permanently
unfilled resulting in an overall reduction in the work force. The City can choose to
eliminate the position associated with the early retirement incentive or another
position within the department or organizational unit.
To provide this early retirement incentive, the City must designate a window period
of between 90 and 180 days during which eligible employees must retire to receive
the early retirement incentive. Staff has proposed that the designated window period
be June 8, 2010 – September 8, 2010. (Important Note: This window period
applies to this Third Round of Early Retirement Incentives. The window period
for the Second Round of Early Retirement Incentives remains unchanged with
a closing date of June 15, 2010 with the last day to retire being June 14, 2010).
FISCAL ANALYSIS:
Staff has identified the following classifications that are eligible to receive the
additional service credit benefit. Please note that the above list has been updated to
reflect additional positions within the Mechanic classification that are eligible to
receive the early retirement incentive.
Classification
Department
Projected Annual
Salary Savings
(excluding
benefits)
Administrative Clerk
Community Development
$47,829
Associate Analyst
Community Development
$70,112
Equipment Service Worker
Transportation
$48,310
Heavy Truck Driver (2)
Public Works
$113,180
Laborer
Public Works
$40,570 City of Culver City, California
City Council Agenda Item Report
Legal Secretary
City Attorney
$68,049
Classification
Department
Projected Annual
Salary Savings
(excluding
benefits)
Maintenance Worker I
Parks, Recreation &
Community Services
$46,883
Mechanic (6)
Transportation
$380,772
Total Projected Annual
Salary Savings:
Up to
$815,705
Less Projected Annual
City Cost to implement
the Early Retirement
Program:
Up to
($36,864)
Net Projected Annual
Salary Savings:
Up to
$778,841
In order to reduce the impact to the City, CalPERS allows the City to pay the annual
cost through an increase in the employer contribution rate, starting two fiscal years
after the end of the designated period, which may continue for as long as twenty (20)
years. The impact of this change on the City’s employer contribution rate is expected
to be minor. Also, such impacts are far less than the annual salary and benefit
savings resulting from the positions being vacated. It should be noted that benefits
represent an additional 35% – 40% of salary in costs to the City.
In addition, the City will experience a one-time cost when the employees cash-out
their accrual leave banks upon retirement in accordance with the terms of their
respective Memorandum of Understanding.
ATTACHMENTS:
1. Proposed Resolution
2. Certification of Compliance with Government Code Section 20903
City of Culver City, California
City Council Agenda Item Report
MOTION:
That the City Council:
1. Adopt a Resolution (a) providing additional service credit pursuant to
Government Code Section 20903 for Local Miscellaneous Members of the
California Public Employees Retirement System (CalPERS); (b) designating
the Window Period as June 8, 2010 to September 8, 2010; and (c) specifying
the Eligible Group of Members; and
2. Authorize the Mayor to execute the Certification of Compliance with
Government Code Section 20903.
MEETING DATE: 6/7/10
AGENDA ITEM: (1) Adoption of a Resolution (a) Providing Additional
Service Credit Pursuant to Government Code Section 20903 for Local
Miscellaneous Members of the California Public Employees Retirement System
(CalPERS); (b) Designating the Window Period as June 8, 2010 to September
8, 2010; and (c) Specifying the Eligible Group of Members; and (2) Authorize
the Mayor to Execute the Certification of Compliance with Government Code
Section 20903.
ATTACHMENTS
Pages
1. Resolution 1 — 2
2. Certification of Compliance with Government Code Section 20903 3RESOLUTION NO, 2010-R A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CULVER CITY, CALIFORNIA TO GRANT ANOTHER
DESIGNATED PERIOD FOR TWO YEARS ADDITIONAL
SERVICE CREDIT
-WHEREAS, the City Council of the City. of Culver City is a contracting
Public Agency of the Public Employees' Retirement System; and
WHEREAS, said Public Agency desires to provide another designated
period of Two Years Additional Service Credit, Section 20903, based on the contradt
amendment included in said contract, which provided for Section 20903, Two Years
Additional Service Credit, for eligible members;
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City
of Culver city, California, does seek to add another designated period, and does
hereby authorize this Resolution, indicating a desire te add a designated period from
June 8, 2010 through September 8, 2010 for eligible Miscellaneous members in the
following positions:
Classification Department
Administrative Clerk Community Development
Associate Analyst Community Development
Equipment Service Worker Transportation
Heavy Truck Driver Public Works
Laborer Public Works
Legal Secretary City Attorney
Maintenance Worker I Parks, Recreation & Community
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28APPR Pol
WymA|10 10|4.trOL A. S—HWA:
ity Attorney
Classification Department
Mechanic Transportation
APPROVED and ADOPTED this day of , 2010.
CHRISTOPHER ARM ENTA, Mayor
City of Culver City, California
ATTEST:
MARTIN R. COLE
City Clerk
Al 0-00176
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28CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM
Employer Services Division
Contract Maintenance Unit
P.O. Box 942709
Sacramento, CA 94229-2709
CERTIFICATION OF COMPLIANCE WITH
GOVERNMENT CODE SECTION 20903
In accordance with Government Code Section 20903 and the contract between the
Public Employees' Retirement System, the City Council of the City of Culver City hereby
certifies that:
1. Because of an impending curtailment of, or change in the manner of performing
service, the best interests of the agency will be served by granting such additional
service credit.
2. The added cost to the retirement fund for all eligible employees who retire during
the designated window period will be included in the contracting agency's
employer contribution rate for the fiscal year that begins two years after the end of
the designated period_
3. It has elected to become subject to Section 20903 because of impending
mandatory transfers, demotions, and layoffs that constitute at least 1 percent of the
job classification, department or organizational unit, as designated by the
governing body, resulting from the curtailment of, or change in the manner of
performing, its services.
4. Its intention at the time Section 20903 becomes operative is to keep all vacancies
created by retirements under this section or at least one vacancy in any position in
any department or other organizational unit permanently unfilled thereby resulting
in an overall reduction in the work force of such department or organizational unit.
THEREFORE, the City Council of the City of Culver City hereby elects to provide the
benefits of Government Code Section 20903 to all eligible members who retire within
the designated period, through CITY COUNCIL
OF THE
CITY OF CULVER CITY
BY
Presiding Officer
Attest:
Clerk/Secretary
Date
2yr certification-PA (Rev. 4/04)