O 648 ORDINANCE NO. 648
AN URGENCY ORDINANCE OF THE CITY COUNCIL OF
THE CITY OF ARROYO GRANDE AUTHORIZING AN
AMENDMENT TO THE CONTRACT BETWEEN THE CITY
OF ARROYO GRANDE AND THE BOARD OF
ADMINISTRATION OF THE CALIFORNIA PUBLIC
EMPLOYEES' RETIREMENT SYSTEM FOR LOCAL
MISCELLANEOUS MEMBERS
WHEREAS, the City of Arroyo Grande, County of San Luis Obispo, State of California
is duly authorized and existing under the laws of said State; and
WHEREAS, the City of Arroyo Grande has contracted with the Board of Administration
of the California Public Employees' Retirement System to provide retirement benefits to
the employees; and
WHEREAS, the City of Arroyo Grande wishes to adopt the provisions of Section 20475
(different level of benefits) for local Miscellaneous members; and
WHEREAS, the City of Arroyo Grande wishes to adopt the provisions of Section 21354
(2% @ 55 Modified formula) for local Miscellaneous members; and
WHEREAS, the City of Arroyo Grande wishes to adopt the provisions of Section 20037
(three-year final compensation) for local Miscellaneous members.
NOW, THEREFORE, BE IT ORDAINED, by the City Council of the City of Arroyo
Grande, as follows:
Section 1: That an amendment to the contract between the City Council of the City of
Arroyo Grande and the Board of Administration, California Public Employees'
Retirement System is hereby authorized, a copy of said amendment being attached
hereto, marked "Exhibit", and by such reference made a part hereof as though herein
set out in full.
Section 2: The Mayor of the City of Arroyo Grande is hereby authorized, empowered,
and directed to execute said amendment for and on behalf of said City.
Section 3: The City Council finds and determines that the immediate preservation of
the public peace, health, and safety requires that this Ordinance be enacted as an
Urgency Ordinance, pursuant to Government Code Section 36937(b), and take effect
immediately upon adoption. As a result of adoption of Assembly Bill 340 by the State
Legislature, a new retirement formula will apply to employees hired after January 1,
2013. Memorandums of Understanding ("MOUs") have been approved with represented
employees agreeing to implement a two-tiered CaIPERS retirement plan. AB 340
prohibits implementation of other retirement plan tiers after December 31, 2012. If this
Ordinance is not adopted as an urgency measure, the City will not be able to comply
ORDINANCE NO. 648
PAGE 2
with these negotiated MOUs. Breach of terms of negotiated agreements will undermine
labor stability and adversely impact the City's ability to achieve labor cost reductions
deemed necessary by this City Council to address budgetary difficulties and structural
reforms needed to maintain fiscal stability and sustainability and provide the services to
the community needed to preserve its peace, health and safety.
Section 4: If any section, subsection, subdivision, paragraph, sentence, or clause of
this Ordinance or any part thereof is for any reason to be unlawful, such decisions shall
not affect the validity of the remaining portion of this Ordinance or any part thereof. The
City Council hereby declares that it would have passed each section, subsection,
subdivision, paragraph, sentence, or clause thereof, irrespective of the fact that any one
or more section, subsection, subdivision, paragraph, sentence, or clause be declared
unlawful.
Section 5: Within fifteen (15) days after passage of this Ordinance, it shall be
published once, together with the names of the Council Members voting thereon, in a
newspaper of general circulation within the City.
On motion of Council Member Brown, seconded by Council Member Guthrie, and on
the following roll call vote, to wit:
AYES: Council Members Brown, Guthrie, Costello, Ferrara
NOES: None
ABSENT: Council Member Ray
the foregoing Ordinance was passed and adopted this 11th day of December, 2012.
ORDINANCE NO. Ca`�Qu
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TONY FEy 1 • , MAYOR
ATTEST:
KELLY TM�1+'E, CITY CLERK
APPROVED AS TO CONTENT:
STEVEN ADAMS CITY MANAGER
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APPROVED AS TO FORM:
ni/U1 . L__--
TIMrbtHY J. CARNIEL, CITY ATTORNEY
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Ca1PERS
EXHIBIT
California
Public Employees' Retirement System
AMENDMENT TO CONTRACT
Between the
Board of Administration
California Public Employees' Retirement System
and the
City Council
City of Arroyo Grande
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The Board of Administration, California Public Employees' Retirement System,
hereinafter referred to as Board, and the governing body of the above public agency,
hereinafter referred to as Public Agency, having entered into a contract effective July
10, 1964, and witnessed June 16, 1964, and as amended effective September 16,
1966, May 24, 1973, July 4, 1980, June 24, 1988, February 12, 1999, October 15, 1999,
September 28, 2000, January 4, 2002, July 2, 2004, December 31, 2004, June 30,
2006, June 27, 2008, June 26, 2009 and December 9, 2011 which provides for
participation of Public Agency in said System, Board and Public Agency hereby agree
as follows:
A. Paragraphs 1 through 16 are hereby stricken from said contract as executed
effective December 9, 2011, and hereby replaced by the following paragraphs
numbered 1 through 17 inclusive:
1. All words and terms used herein which are defined in the Public
Employees' Retirement Law shall have the meaning as defined therein
unless otherwise specifically provided. "Normal retirement age" shall mean
age 55 for local miscellaneous members, age 50 for local police members
entering membership in the police classification on or prior to December 9,
2011, age 55 for local fire members and for those local police members
entering membership for the first time in the police classification after
December 9, 2011.
2. Public Agency shall participate in the Public Employees' Retirement
System from and after July 10, 1964 making its employees as hereinafter
provided, members of said System subject to all provisions of the Public
Employees' Retirement Law except such as apply only on election of a
contracting agency and are not provided for herein and to all amendments
to said Law hereafter enacted except those, which by express provisions
thereof, apply only on the election of a contracting agency.
3. Public Agency agrees to indemnify, defend and hold harmless the
California Public Employees' Retirement System (CaIPERS) and its
trustees, agents and employees, the CaIPERS Board of Administration,
and the California Public Employees' Retirement Fund from any claims,
demands, actions, losses, liabilities, damages, judgments, expenses and
costs, including but not limited to interest, penalties and attorneys fees
that may arise as a result of any of the following:
(a) Public Agency's election to provide retirement benefits,
provisions or formulas under this Contract that are different than
the retirement benefits, provisions or formulas provided under
the Public Agency's prior non-CaIPERS retirement program.
(b) Public Agency's election to amend this Contract to provide
retirement benefits, provisions or formulas that are different than
existing retirement benefits, provisions or formulas.
(c) Public Agency's agreement with a third party other than
CaIPERS to provide retirement benefits, provisions, or formulas
that are different than the retirement benefits, provisions or
formulas provided under this Contract and provided for under
the California Public Employees' Retirement Law.
(d) Public Agency's election to file for bankruptcy under Chapter 9
(commencing with section 901) of Title 11 of the United States
Bankruptcy Code and/or Public Agency's election to reject this
Contract with the CaIPERS Board of Administration pursuant to
section 365, of Title 11, of the United States Bankruptcy Code
or any similar provision of law.
(e) Public Agency's election to assign this Contract without the prior
written consent of the CaIPERS' Board of Administration.
(f) The termination of this Contract either voluntarily by request of
Public Agency or involuntarily pursuant to the Public Employees'
Retirement Law.
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(g) Changes sponsored by Public Agency in existing retirement
benefits, provisions or formulas made as a result of
amendments, additions or deletions to California statute or to
the California Constitution.
4. Employees of Public Agency in the following classes shall become
members of said Retirement System except such in each such class as
are excluded by law or this agreement:
a. Local Fire Fighters (herein referred to as local safety members);
b. Local Police Officers (herein referred to as local safety members);
c. Employees other than local safety members (herein referred to as
local miscellaneous members).
5. In addition to the classes of employees excluded from membership by
said Retirement Law, the following classes of employees shall not become
members of said Retirement System:
a. EMPLOYEES COMPENSATED ON AN HOURLY BASIS; AND
b. ELECTED OFFICIALS.
6. The percentage of final compensation to be provided for each year of
credited prior and current service as a local miscellaneous member in
employment before and not on or after June 27, 2008 shall be determined
in accordance with Section 21354 of said Retirement Law subject to the
reduction provided therein for Federal Social Security (2% at age 55
Modified and Full).
7. The percentage of final compensation to be provided for each year of
credited prior and current service as a local miscellaneous member in
employment on or after June 27, 2008 and not entering membership for
the first time in the miscellaneous classification after the effective date of
this amendment to contract shall be determined in accordance with
Section 21354.4 of said Retirement Law subject to the reduction provided
therein for Federal Social Security (2.5% at age 55 Modified and Full).
8. The percentage of final compensation to be provided for each year of
credited current service as a local miscellaneous member entering
membership for the first time in the miscellaneous classification after the
effective date of this amendment to contract shall be determined in
accordance with Section 21354 of said Retirement Law subject to the
reduction provided therein for Federal Social Security (2% at age 55
Modified).
9. The percentage of final compensation to be provided for each year of
credited prior and current service as a local fire member shall be
determined in accordance with Section 21363.1 of said Retirement Law
subject to the reduction provided therein for Federal Social Security (3% at
age 55 Modified).
10. The percentage of final compensation to be provided for each year of
credited prior and current service as a local police member entering
membership in the police classification on or prior to December 9,
2011 shall be determined in accordance with Section 21362.2 of said
Retirement Law subject to the reduction provided therein for Federal
Social Security (3% at age 50 Modified).
11. The percentage of final compensation to be provided for each year of
credited current service as a local police member entering membership for
the first time in the police classification after December 9, 2011 shall be
determined in accordance with Section 21363.1 of said Retirement Law
subject to the reduction provided therein for Federal Social Security (3% at
age 55 Modified).
12. Public Agency elected and elects to be subject to the following optional
provisions:
a. Section 21222.1 (One-Time 5% Increase - 1970). Legislation
repealed said Section effective January 1, 1980.
b. Section 20965 (Credit for Unused Sick Leave).
c. Section 21024 (Military Service Credit as Public Service).
d. Section 21027 (Military Service Credit for Retired Persons).
e. Section 20042 (One-Year Final Compensation) for local fire
members and those local police members entering membership on
or prior to December 9, 2011 and local miscellaneous members
entering membership on or prior to the effective date of this
amendment to contract.
f. Section 21548 (Pre-Retirement Option 2W Death Benefit) for local
miscellaneous members only.
g. Section 20903 (Two Years Additional Service Credit) for local
miscellaneous members only.
h. Section 20475 (Different Level of Benefits). Section 21363.1 (3%
@ 55 Modified formula) and Section 20037 (Three-Year Final
Compensation) are applicable to local police members entering
membership for the first time in the police classification after
December 9, 2011.
Section 21354.4 (2% @ 55 Modified formula) and Section 20037
(Three-Year Final Compensation) are applicable to local
miscellaneous members entering membership for the first time in
the miscellaneous classification after the effective date of this
amendment to contract.
13. Public Agency, in accordance with Government Code Section 20790,
ceased to be an "employer" for purposes of Section 20834 effective on
July 4, 1980. Accumulated contributions of Public Agency shall be fixed
and determined as provided in Government Code Section 20834, and
accumulated contributions thereafter shall be held by the Board as
provided in Government Code Section 20834.
14. Public Agency shall contribute to said Retirement System the contributions
determined by actuarial valuations of prior and future service liability with
respect to local miscellaneous members and local safety members of said
Retirement System.
15. Public Agency shall also contribute to said Retirement System as follows:
a. A reasonable amount, as fixed by the Board, payable in one
installment within 60 days of date of contract to cover the costs of
administering said System as it affects the employees of Public
Agency, not including the costs of special valuations or of the
periodic investigation and valuations required by law.
b. A reasonable amount, as fixed by the Board, payable in one
installment as the occasions arise, to cover the costs of special
valuations on account of employees of Public Agency, and costs of
the periodic investigation and valuations required by law.
16. Contributions required of Public Agency and its employees shall be
subject to adjustment by Board on account of amendments to the Public
Employees' Retirement Law, and on account of the experience under the
Retirement System as determined by the periodic investigation and
valuation required by said Retirement Law.
17. Contributions required of Public Agency and its employees shall be paid
by Public Agency to the Retirement System within fifteen days after the
end of the period to which said contributions refer or as may be prescribed
by Board regulation. If more or less than the correct amount of
contributions is paid for any period, proper adjustment shall be made in
connection with subsequent remittances. Adjustments on account of
errors in contributions required of any employee may be made by direct
payments between the employee and the Board.
B. This amendment shall be effective on the day of
BOARD OF ADMINISTRATION CITY COUNCIL
PUBLIC EMPLOYEES' RETIREMENT SYSTEM CITY OF ARROYO GRANDE
BY BY
KAREN DE FRANK, CHIEF PRESIDING OFFICER
CUSTOMER ACCOUNT SERVICES DIVISION
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
Witness Date
Attest:
Clerk
AMENDMENT CaIPERS ID#6540026274
PERS-CON-702A
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OFFICIAL CERTIFICATION
I, KELLY WETMORE, City Clerk of the City of Arroyo Grande, County of San
Luis Obispo, State of California, do hereby certify under penalty of perjury, that
the attached is a true, full,.and correct copy of Urgency Ordinance No. 648 which
was passed and adopted at a regular meeting of the City.Council on the 11th day
of December 2012; and was duly published in accordance with State law (G.C. '
40806).
WITNESS my hand and the Seal of the City of Arroyo Grande affixed this 13th
day of December 2012.
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KELLY ET/I RE, CITY CLERK
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