TO:
Honorable Mayor and Members of the City Council
THROUGH:
Mark Danaj, City Manager
FROM:
Teresia Zadroga-Haase, Human Resources Director
SUBJECT:Title
Ordinance to Authorize an Amendment to the Contract Between the Board of Administration of the California Public Employees’ Retirement System and the City of Manhattan Beach to allow police officers and fire fighters to share the cost of employer contributions on a pre-tax basis. (Human Resources Director Zadroga-Haase).
INTRODUCE ORDINANCE NO. 16-0006
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Recommended Action
RECOMMENDATION:
It is recommended that the City Council introduce, and subsequently adopt Ordinance No. 16-0006 (Attachment 1) to authorize an amendment to the contract between the Board of Administration of the California Public Employees’ Retirement System (CalPERS) and Manhattan Beach, to include the provisions of retirement law Government Code Section 20516 (Employees Sharing Additional Cost) for the Police Officers’ Association, Firefighters’ Association and Police Management Association (Unions).
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EXECUTIVE SUMMARY:
During the 2015 collective bargaining agreement negotiations with the Firefighters’ Association and subsequent negotiations with the Police and Police Management associations, City Council approved initiating the amendment process with CalPERS in order to change the manner in which employees make contributions toward the cost of their retirement benefits. The City must amend the contract with CalPERS to include retirement law Government Code section 20516(a) in order to allow employees to share the cost of “employer contributions” to CalPERS retirement system on a pre-tax basis.
FISCAL IMPLICATIONS:
There are no fiscal implications associated with the recommended action as the employees in these bargaining units are already contributing the additional 3% cost sharing of employer contribution on an after-tax basis.
BACKGROUND:
CalPERS has a detailed process in order for an agency to amend its contract when the change in benefits affects the employees’ contribution rate. Step 1 is for the Unions and City to agree to start the process to amend the CalPERS retirement contract. This was completed during the above-referenced collective bargaining sessions.
Step 2 requires the City Council to adopt a Resolution of Intention to approve the amendment. The Resolution of Intention to Approve an Amendment to the CalPERS contract was approved by Council at your meeting of September 20, 2016 (Attachment 2). The draft contract amendment is Exhibit A of the proposed Ordinance attached as Attachment 1.
Step 3 requires a secret ballot election for each bargaining unit affected (per Government Code 20474). These elections have occurred and the certification of results is attached as Attachment 6.
Step 4 requires the City Council to introduce and then adopt an Ordinance authorizing an amendment to contract, which is the subject recommendation of this agenda item. The proposed ordinance is attached as Attachment 1.
The final step is for implementation 30 days after the Ordinance is adopted by the City Council after second reading.
DISCUSSION:
Subsequent to the adoption of the Resolution of Intention to amend the CalPERS contract, the Firefighters’ Association, Police Officers’ Association and Police Management Association held a secret ballot election per Government Code Section 20474. A majority of affected members from each bargaining unit have voted to approve the City’s intention to amend its contract to provide Section 20516 (Employees Sharing Additional Cost) as reported in the Certification of Employee Election report (Attachment 6). The amendment will provide 3% for classic local fire members in the Manhattan Beach Firefighters’ Association and 3% for classic local police members in the Manhattan Beach Police Officers’ Association and the Manhattan Beach Police Management Association on the basis described in the Resolution of Intention.
POLICY ALTERNATIVES:
In that this is the final step of the process, and both the City Council and the majority of the affected members approved the City’s intention to amend its contract, policy alternatives are not applicable at this time.
PUBLIC OUTREACH/INTEREST:
No additional public outreach is required.
LEGAL REVIEW
The City Attorney has approved the ordinance as to legal form.
Attachments:
1. Ordinance No. 16-0006 (CalPERS Contract Amendment)
2. Resolution No. 16-0052 Adopted on September 20, 2016
3. Certification of Governing Body’s Action
4. Certification of Compliance with Government Code Section 20516
5. Certification of Compliance with Government Code Section 7507
6. Certification of Employee Election