HomeMy WebLinkAbout2020-97 - To Terminate the Joint Exercise of Powers Agreement and Dissolve the Joint Powers Employee Benefit Authority Effective at the End of Fiscal Year 2020-21, June 30, 2021RESOLUTION NO. 2020-97
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF NEWPORT BEACH, CALIFORNIA, TO TERMINATE
THE JOINT EXERCISE OF POWERS AGREEMENT AND
DISSOLVE THE JOINT POWERS EMPLOYEE BENEFIT
AUTHORITY EFFECTIVE AT THE END OF FISCAL YEAR
2020-21, JUNE 30, 2021
WHEREAS, in November 1987, the City Council of the City of Costa Mesa and the
City Council of the City of Newport Beach adopted resolutions (Resolution Nos. 87-107
and 87-167, respectively) authorizing them to execute a Joint Exercise of Powers
Agreement ("Agreement") creating the Joint Powers Employee Benefit Authority
("JPEBA") to establish, manage, operate and maintain employee benefit programs;
WHEREAS, effective January 1, 1988, the JPEBA established the Medical
Premium Retirement Benefit Plan (the "Plan"), the purpose of which was to promote
retention and employee morale by providing the ability to defer compensation to fund
post-retirement medical coverage premium costs;
WHEREAS, on June 18, 1991, the City Council of the City of Garden Grove
adopted Resolution No. 7380-91, authorizing the addition of the City of Garden Grove as
a party to the Agreement including participation in the Plan;
WHEREAS, effective January 1, 2005, Section 409A was added to the United
States Internal Revenue Code of 1986 and imposed new regulations on nonqualified
deferred compensation plans after December 31, 2004; and
WHEREAS, effective January 1, 2005, the Plan was bifurcated as follows: with all
amounts deferred, earned and invested on or before December 31, 2004 being
grandfathered ("Grandfathered Amounts") under the law applicable to deferred
compensation before the enactment of Section 409A, and all amounts deferred, earned
and invested after December 31, 2004, regulated under Section 409A ("409A Amounts");
WHEREAS, the cities of Newport Beach and Costa Mesa discontinued further
contributions to the Plan effective January 1, 2005, with the City of Garden Grove ceasing
future contributions to the Plan effective December 31, 2006;
WHEREAS, the City of Newport Beach distributed final reimbursements (assets)
to participants in March 2007, and with no further carryforward balance, the Plan fund
closed;
WHEREAS, Section 17.01 of the Agreement provides that the governing bodies
of the JPEBA members may determine that the public interest will not be served by
continuance of the Agreement;
Resolution No. 2020-97
Page 2 of 3
WHEREAS, Section 17.01 further provides that if the governing bodies of at least
three-quarters (3/4) of the JPEBA members adopt a Resolution of Termination within any
120 -day period, then the Agreement shall be terminated at the end of the fiscal year,
defined by the Agreement as ending on June 30 of each year;
WHEREAS, the Newport Beach City Council has determined that the public
interest will not be served by continuing the Agreement and desires to adopt this
resolution to terminate the Agreement and dissolve the JPEBA; and
WHEREAS, the governing authorities for the Cities of Garden Grove and Costa
Mesa will be presented with similar resolutions to terminate the Agreement on December
8, 2020 and December 15, 2020, respectively.
NOW, THEREFORE, the City Council of the City of Newport Beach resolves as
follows:
Section 1: That the Agreement should be terminated and the JPEBA dissolved
effective at the end of Fiscal Year 2020-2021, June 30, 2021.
Section 2: The City Manager or her designee is authorized to take all steps
necessary to dissolve the JPEBA, including but not limited to execution of any and all
documents required to dissolve the JPEBA.
Section 3: The recitals provided in this resolution are true and correct and are
incorporated into the operative part of this resolution.
Section 4: If any section, subsection, sentence, clause or phrase of this
resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not
affect the validity or constitutionality of the remaining portions of this resolution. The City
Council hereby declares that it would have passed this resolution, and each section,
subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or
more sections, subsections, sentences, clauses or phrases be declared invalid or
unconstitutional.
Section 5: The City Council finds the adoption of this resolution is not subject to
the California Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the
activity will not result in a direct or reasonably foreseeable indirect physical change in the
environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378)
of the CEQA Guidelines, California Code of Regulations, Title 14, Division 6, Chapter 3,
because it has no potential for resulting in physical change to the environment, directly or
indirectly.
Resolution No. 2020-97
Page 3 of 3
Section 6: This resolution shall take effect immediately upon its adoption by the
City Council, and the City Clerk shall certify the vote adopting the resolution.
ADOPTED this 24th day of November 2020.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
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Aaron C. Harp
City Attorney
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Will O'Neill
Mayor
STATE OF CALIFORNIA }
COUNTY OF ORANGE } ss.
CITY OF NEWPORT BEACH )
I, Leilani 1. Brown, City Clerk of the City of Newport Beach, California, do hereby certify that the
whole number of members of the City Council is seven; the foregoing resolution, being Resolution
No. 2020-97 was duly introduced before and adopted by the City Council of said City at a regular meeting
of said Council held on the 24th day of November, 2020; and the same was so passed and adopted by the
following vote, to wit:
AYES: Mayor Will O'Neill, Mayor Pro Tem Brad Avery, Council Member Joy Brenner,
Council Member Diane Dixon, Council Member Jeff Herdman, Council Member Kevin
Muldoon
NAYS: None
ABSENT: Council Member Duffy Duffield
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the official seal of
said City this 251h day of November, 2020.
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Leilani I. Brown
City Clerk
Newport Beach, California