HomeMy WebLinkAbout1996-10-01; City Council; 13823; ONE TO FOUR YEARS ADDITIONAL SERVICE CREDIT FOR ELIGIBLE CITY EMPLOYEES RETIRING FROM CITY SERVICEz 0
k 0 a
-
d z 3 0 0
PERS allows a 120-day period in which eligible members who meet the conditions must
retire in order to receive the service credit. This period may begin as early as one day
following, and end not more than 120 days following, the City’s adoption of the
Resolution. Per these requirements, the City of Carlsbad’s One to Four Years Additional
Service Credit period will begin on October 2,1996 and end January 29,1997.
1
I
0. 0.
PAGE 2 OF AB# f3, E23
The following table summarizes staffs recommendations for amendments to the General
Employees’ and Management classification and salary plans that would result if the five
eligible members take the offered retirement option:
PIT Ref. Librarian
The five affected employees have all indicated that they are interested in this voluntary
benefit option. Should they elect to retire within the 120-day window, staff will then
return to Council for authorization to make amendments to the classification and
compensation plans as required.
FISCAL IMPACT:
Five positions are eligible for this retirement option. Should all five employees elect to
retire within the specified timeframe, the positions will either be eliminated or
reclassified. This reorganization will produce an estimated net annual salary savings of
$103,000. PERS will require a one-time lump sum payment of approximately $82,000
following the retirements to cover the cost of providing the additional service credit.
This one-time payment to PERS will result in higher costs to the City idtially, however
these costs will be recouped over time as the salary savings are recognized in the future.
c
P
0- 0.
PAGE3OFAB# 13) 823
The annual salary savings of $103,000, less the $82,000 lump sum payment to PERS,
would produce a net salary savings of $2 1,000 for the first full year. Thereafter, the net
annual salary savings would continue at $103,000 per year as indicated below:
Salary Savings PERS Cost Net Savings
FY 96-97 Jan.-June $ 51,500 $ 82,000 $ (30,500)
FY 97-98 July-Dec. $ 51,500 $ 51,500
$1 03,000 $ 82,000 $ 21,000
As shown in the table above, in FY 96-97 the one-time lump sum payment to PERS will
exceed the projected salary savings by $30,500. These costs will be recouped by salary
savings in the first half of FY 97-98. Staff is therefore recommending a $30,500 transfer
from the Council General Fund Contingency Account at this time. Thereafter, the net
annual salary savings are projected to continue at $103,000 for each year.
EXHIBITS:
1.
2.
Resolution No. c/ t!~ -21 '[
Certification of Compliance and Agreement to Requirements for Section 20821.6
/
I
1
2
3
4
5
6
7
8
9
lo
11
l2
13
14
15
16
17
18
19
2o
21
22
23
24
25
26
27
28
e. 0.
RESOLUTION NO. 9 6 - 3 14
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CARLSBAD, CALIFORNIA, GRANTING ONE TO FOUR
YEARS ADDITIONAL SERVICE CREDIT.
WHEREAS, the City of Carlsbad is a contracting Public Agency of the Public
Employees’ Retirement System; and
WHEREAS, California Government Code Section 20821.6 provides that when
the governing body of a contracting agency determines that because of an impending
curtailment of, or change in the manner of performing service, the best interests of the
agency would be served by encouraging the retirement of local members, the governing
body may adopt a resolution to grant eligible employees one to four years additional
service credit when certain conditions specified in said section exist; and
WHEREAS, said section requires the governing body to specify the number of
whole years of additional service credit being granted and to determine a period in which
eligible members, who meet the conditions, must retire to be entitled to receive said
credit; and
WHEREAS, said period may begin as early as one day following, and end not
more than 120 days following, the governing body’s adoption of the resolution; and
WHEREAS, said Section requires the governing body to designate the categories
of eligible members and allows for eligibility to be limited to members employed in
specific Department(s), Program(s) andor position classifications within said Agency;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of I
Carlsbad, California, as follows:
1.
2.
That the above recitations are true and correct.
That the City Council, as the governing body of the City of Carlsbad, has
determined that because of an impending curtailment of service, or change in the manner
of performing service, the best interests of the City of Carlsbad would be served by
encouraging the retirement of local members and desires to provide two whole years
additional service credit pursuant to Section 20821.6 for eligible local Miscellaneous
members.
;
/I
1
2
3
4
5
'6
I
8
9
10
11
l2
13
14
15
16
17
0. 0.
BE IT FURTHER RESOLVED, that said governing body determines that the
period in which eligible members who meet the conditions, must retire to be entitled to
the additional credit shall begin on October 2,1996 and end on January 29,1997, and that
to be entitled to the additional service credit, eligible members who meet the conditions
are employed in the following departments and job classifications of the City of Carlsbad
on the date of adoption of this Resolution:
Department Job Classification
City Clerk Minutes Clerk
City Clerk Senior Office Specialist
City Manager Executive Assistant
Community Services-Fleet Offce Specialist I1
Library-Genealogy Senior Librarian
3. That an estimated $30,500 be transferred from the Council's General Fund
Contingency Fund to cover costs in FY 96-97 associated with providing the additional
two years of PERS service credit. That these costs are expected to be recouped in FY
97-98 through salary savings.
4. That the Mayor is hereby authorized to execute the Certification of
Compliance and Agreement to Requirements for Section 20821.6 of the Government
Code.
18
2o
21
22
23
24
25
26
27
28
PASSED, APPROVED, AND ADOPTED at a regular meeting of the Carlsbad
, 1996, by the following vote, to City Council held on the 1st day of October
wit:
AYES:
NOES: None
ABSENT: None
Council Members Lewis, Nygaard, Kulchin, Hall and Finnila I
-
ATTEST: m ALETHA L. RAUTENKRANZ, City Clerk
(SEAL)
c
/
CERTIFICATION OF COMPLIANCE AND AGREEMENT
TO REQUIREMENTS FOR SECTION 20821.6
Government Code Section 20821.6 provides that an agency in the process of adopting a
Resolution to provide One to Four Years Additional Service Credit must also certify that it
is in accordance with Section 20821.6 of the Government Code, and agrees to the additional
requirements itemized below:
1. THE EXTENT THE SAVINGS WILL EXCEED THE PAYMENT TO PERS:
Five positions are eligible for this retirement option. Should all 5 employees elect to
retire within the specified timeframe, the positions will either be eliminated or
reclassified. This reorganization will produce a net salary savings of approximately
$103,000. The cost of providing the additional 2 years of PERS service credit is
approximately $82,000, leaving a net annual salary savings of $21,000 for the first year.
Thereafter, the net annual salary savings will continue at $103,000.
2. SPECIFIC MEASURES TO BE TAKEN TO ASSURE THE SAVINGS:
The following table summarizes staffs recommendations for amendments to the
General Employees’ and Management classification and salary plans that would result if
the five eligible members take the offered retirement option:
....................................
..................
G
@ ~ ____-__ ~ ______ _. .~~ _.__ ________ __. - -.- - I200 Carlsbad Village Drive - Carlsbad, California 92008 1989 - (61 9) 434-2830
om 0.
Certification of Compliance and Agreement to Requirements for Section 20821.6
October 1, 1996
Page 2
3. SUFFICIENT POSITIONS HAVE BEEN DELETED WITH A TOTAL COST THAT
EQUALS OR EXCEEDS THE LUMP SUM ACTUARIAL COST OF THE
ADDITIONAL SERVICE CREDIT GRANTED:
Five positions are eligible for this retirement option. Should all 5 employees elect to
retire within the specified timeframe, the positions will either be eliminated or
reclassified. This reorganization will produce a net salary savings of approximately
$103,000. The cost of providing the additional 2 years of PERS service credit is
approximately $82,000, leaving a net annual salary savings of $21,000 for the first year.
Thereafter, the net annual salary savings will continue at $103,000.
4. THE AGENCY AGREES TO TRANSMIT TO THE RETIREMENT FUND:
a) An amount determined by the Board to equal the actuarial equivalent of the
difference between the allowance the member receives after receipt of the
additional service credit and the amount the member would have received
without the additional senice credit; and,
b) administrative costs, if any.
5. ADDITIONAL REQUIREMENTS: The City agrees to:
a) Maintain records for each worker retiring pursuant to this section (name, social
security number, retirement effective date, cost of additional service credit);
b) Provide verification of its certifications through independent review if the
Retirement Board so requires;
c) Certify that the eligible employees do not receive unemployment insurance
payments anytime within two years of the governing body’s adoption of the
Resolution granting the additional service, due to employment with any
employer participating in the PERS retirement program;
d) Certify the amount of actual savings and the measures taken to achieve the
savings that are more than adequate to meet necessary payments to the
Retirement Board at such time the savings are achieved, or five years after
commencement of the 120 day retirement period, whichever occurs first.
CITY OF CARLSBAD
ma- 94
Date
I: ,i
CALIFORNIA PUB I@ ~PLOYEES' RETIREMENT S a8
Actuarial and Employer Services Division
Public Agency Contract Services
Sacramento, CA 94229-2709
P,O, Box 942709
(916) 326-3420
CERTIFICATION OF COMPLIANCE WITH
GOVERNMENT CODE SECTION 7507
I hereby certify that in accordance with Section 7507 of the Government Code the future annual
costs as determined by the System Actuary andor the increase in retirement benefit(s) have been
made public at a public meeting of the City Council
(governing body)
of the CITY OF CAlUSBAD
(public agency)
on September 10, 1996 which is at least two weeks prior to the adoption of the
(date)
ResolutiodOrdinance.
1 -
Clerklk~ /
CITY CLERK
Title
Date 0 & 2./9'iI5
PERS-CON- 12A (rev 1/96)