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HomeMy WebLinkAbout03 - Enhanced Retirement & Cafeteria Plan BenefitsJune 13, 2000 Agenda Item 3 CITY OF NEWPORT BEACH HUMAN RESOURCES DEPARTMENT TO: Mayor and City Council D I ., FROM: Sharon Wood, Assistant City Manager . f/"" SUBJECT: Implementation of Enhanced Retirement and Cafeteria Plan Benefits for Miscellaneous Employees and Marine Safety Officers RECOMMENDATION Adopt the following Resolutions: A Resolution of the City Council of the City of Newport Beach only with Respect to Members of the Newport Beach City Employees Association, Fixing the Employer's Contribution under the Public Employees' Medical and Hospital Care Act 2. A Resolution of the City Council of the City of Newport Beach only with Respect to Members of the Newport Beach Employees League, Fixing the Employer's Contribution under the Public Employees' Medical and Hospital Care Act 3. A Resolution of the City Council of the City of Newport Beach only with Respect to Members of the Newport Beach Professional and Technical Employees Association, Fixing the Employer's Contribution under the Public Employees' Medical and Hospital Care Act 4. A Resolution of the City Council of the City of Newport Beach only with Respect to Members of the Newport Beach Key and Management Employees, Fixing the Employer's Contribution under the Public Employees' Medical and Hospital Care Act A Resolution of the City Council of the City of Newport Beach only with Respect to Members of the Newport Beach Marine Safety Officers Association, Fixing the Employer's Contribution under the Public Employees' Medical and Hospital Care Act 6. A Resolution of the City Council of the City of Newport Beach only with Respect to Members of the Newport Beach City Council, Fixing the Employer's Contribution under the Public Employees' Medical and Hospital Care Act 7. A Resolution of the City Council of the City of Newport Beach Declaring its Intention to Approve an Amendment to Contract Between the Board of Administration, California Public Employees' Retirement System and the City Council, City of Newport Beach DISCUSSION The City Council approved Supplemental Memoranda of Understanding with the three non - safety employee associations on April 25, 2000. These Supplemental MOUs establish a flexible benefits (cafeteria) plan, improve funding for the retiree medical insurance plan, and provide the 2% @ 55 retirement plan. City Council adoption of the resolutions attached to this report is required to implement the cafeteria plan and the new retirement plan. Funding of the retiree medical plan will be accomplished through increased payroll deductions and City contributions, concurrent with the effective date of the new retirement plan. A new MOU with the Marine Safety Officers Association is on this Council agenda. It includes the same agreements regarding the cafeteria plan and the retiree medical insurance program as the miscellaneous employees' Supplemental MOUs. The other public safety associations have requested that discussion of these items be included in their negotiations for an enhanced retirement program. The California Public Employees' Retirement System (PERS) HealthCare program, which the City joined in 1993, requires local agencies to provide an equal monthly contribution for both active and retired members. Newport Beach's contribution for active employees has been higher than for retirees, and the City has an agreement with PERS to equalize these contributions over time. Introduction of the cafeteria plan allows the City to correct this situation by establishing the contribution for both active and retired employees at $16 per month, the minimum amount required by PERS. This contribution will be deducted from the amount available to active employees for their cafeteria plan, as provided in the Supplemental MOUs. Separate Resolutions are required for each employee association, as well as for the City Council and Key and Management employees, who also will be eligible for the cafeteria plan. An amendment to the City's contract with PERS is required to provide the 2% @ 55 retirement benefit. The first step in the amendment process is adoption of the attached Resolution of Intention, which notifies the public that the City Council is considering this action. No sooner than 20 days after adoption of the Resolution, the City Council may adopt an ordinance authorizing the amendment. Staff intends to place this ordinance on the agenda for July 11, 2000. 2 RESOLUTION NO. 2000 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH ONLY WITH RESPECT TO MEMBERS OF THE NEWPORT BEACH CITY EMPLOYEES LEAGUE, FIXING THE EMPLOYER'S CONTRIBUTION UNDER THE PUBLIC EMPLOYEES' MEDICAL AND HOSPITAL CARE ACT WHEREAS (1) Government Code Section 22825.6 provides that a local agency contracting under the Public Employees' Medical and Hospital Care Act shall fix the amount of the employer's contribution at an amount not less than the amount required under Section 22825 of the Act; and WHEREAS, (2) City of Newport Beach, hereinafter referred to as Public Agency is local agency contracting under the Act for participation by members of the Newport Beach City Employees League; and NOW, THEREFORE, BE IT RESOLVED, AS FOLLOWS: (a) That the employer's contribution for each employee or annuitant shall be the amount necessary to pay the full cost of his/her enrollment, including the enrollment of his/her family members in a health benefits plan up to a maximum of $16.00 per month; plus administrative fees and contingency reserve fund assessments; and (b) That the City Council appoint and direct, and it does hereby appoint and direct Sharon Wood, Assistant City Manager, to file with the Board of Administration of the Public Employees' Retirement System a verified copy of this Resolution, and to perform on behalf of said Public Agency all functions required of it under the Act and Regulations of the Board of Administration; and (c) That coverage under the Act be effective on or after July 12, 2000. ADOPTED at the regular meeting of the City Council at Newport Beach, California on this day of June 2000 Signed: ATTEST: CITY CLERK Mayor RESOLUTION NO. 2000 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH ONLY WITH RESPECT TO MEMBERS OF THE NEWPORT BEACH CITY EMPLOYEES ASSOCIATION, FIXING THE EMPLOYER'S CONTRIBUTION UNDER THE PUBLIC EMPLOYEES' MEDICAL AND HOSPITAL CARE ACT WHEREAS (1) Government Code Section 22825.6 provides that a local agency contracting under the Public Employees' Medical and Hospital Care Act shall fix the amount of the employer's contribution at an amount not less than the amount required under Section 22825 of the Act; and WHEREAS, (2) City of Newport Beach, hereinafter referred to as Public Agency is local agency contracting under the Act for participation by members of the Newport Beach Employees League; and NOW, THEREFORE, BE IT RESOLVED, AS FOLLOWS: (a) That the employer's contribution for each employee or annuitant shall be the amount necessary to pay the full cost of his/her enrollment, including the enrollment of his/her family members in a health benefits plan up to a maximum of $16.00 per month; plus administrative fees and contingency reserve fund assessments; and (b) That the City Council appoint and direct, and it does hereby appoint and direct Sharon Wood, Assistant City Manager, to file with the Board of Administration of the Public Employees' Retirement System a verified copy of this Resolution, and to perform on behalf of said Public Agency all functions required of it under the Act and Regulations of the Board of Administration; and (c) That coverage under the Act be effective on or after July 12, 2000. ADOPTED at the regular meeting of the City Council at Newport Beach, California on this day of June 2000 Signed: ATTEST: CITY CLERK Mayor RESOLUTION NO. 2000 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH ONLY WITH RESPECT TO MEMBERS OF THE NEWPORT BEACH PROFESSIONAL AND TECHNICAL ASSOCIATION, FIXING THE EMPLOYER'S CONTRIBUTION UNDER THE PUBLIC EMPLOYEES' MEDICAL AND HOSPITAL CARE ACT WHEREAS (1) Government Code Section 22825.6 provides that a local agency contracting under the Public Employees' Medical and Hospital Care Act shall fix the amount of the employer's contribution at an amount not less than the amount required under Section 22825 of the Act; and WHEREAS, (2) City of Newport Beach, hereinafter referred to as Public Agency is local agency contracting under the Act for participation by members of the Professional and Technical Association; and NOW, THEREFORE, BE IT RESOLVED, AS FOLLOWS: (a) That the employer's contribution for each employee or annuitant shall be the amount necessary to pay the full cost of his/her enrollment, including the enrollment of his/her family members in a health benefits plan up to a maximum of $16.00 per month; plus administrative fees and contingency reserve fund assessments; and (b) That the City Council appoint and direct, and it does hereby appoint and direct Sharon Wood, Assistant City Manager, to file with the Board of Administration of the Public Employees' Retirement System a verified copy of this Resolution, and to perform on behalf of said Public Agency all functions required of it under the Act and Regulations of the Board of Administration; and (c) That coverage under the Act be effective on or after July 12, 2000. ADOPTED at the regular meeting of the City Council at Newport Beach, California on this day of June 2000 Signed: ATTEST: CITY CLERK Mayor RESOLUTION NO. 2000 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH ONLY WITH RESPECT TO MEMBERS OF THE NEWPORT BEACH KEY AND MANAGEMENT EMPLOYEES, FIXING THE EMPLOYER'S CONTRIBUTION UNDER THE PUBLIC EMPLOYEES' MEDICAL AND HOSPITAL CARE ACT WHEREAS (1) Government Code Section 22825.6 provides that a local agency contracting under the Public Employees' Medical and Hospital Care Act shall fix the amount of the employer's contribution at an amount not less than the amount required under Section 22825 of the Act; and WHEREAS, (2) City of Newport Beach, hereinafter referred to as Public Agency is local agency contracting under the Act for participation by members of the Key and Management Employees; and NOW, THEREFORE, BE IT RESOLVED, AS FOLLOWS: (a) That the employer's contribution for each employee or annuitant shall be the amount necessary to pay the full cost of his/her enrollment, including the enrollment of his/her family members in a health benefits plan up to a maximum of $16.00 per month; Plus administrative fees and Contingency Reserve Fund Assessments; and (b) That the City Council appoint and direct, and it does hereby appoint and direct Sharon Wood, Assistant City Manager, to file with the Board of Administration of the Public Employees' Retirement System a verified copy of this Resolution, and to perform on behalf of said Public Agency all functions required of it under the Act and Regulations of the Board of Administration; and (c) That coverage under the Act be effective on or after July 12, 2000. ADOPTED at the regular meeting of the City Council at Newport Beach, California on this day of June 2000 Signed: ATTEST: CITY CLERK Mayor RESOLUTION NO. 2000 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH ONLY WITH RESPECT TO MEMBERS OF THE NEWPORT BEACH MARINE SAFETY OFFICERS ASSOCIATION, FIXING THE EMPLOYER'S CONTRIBUTION UNDER THE PUBLIC EMPLOYEES' MEDICAL AND HOSPITAL CARE ACT WHEREAS (1) Government Code Section 22825.6 provides that a local agency contracting under the Public Employees' Medical and Hospital Care Act shall fix the amount of the employer's contribution at an amount not less than the amount required under Section 22825 of the Act; and WHEREAS, (2) City of Newport Beach, hereinafter referred to as Public Agency is local agency contracting under the Act for participation by members of the Newport Beach Marine Safety Officers Association; and NOW, THEREFORE, BE IT RESOLVED, AS FOLLOWS: (a) That the employer's contribution for each employee or annuitant shall be the amount necessary to pay the full cost of his/her enrollment, including the enrollment of his/her family members in a health benefits plan up to a maximum of $16.00 per month; plus administrative fees and contingency reserve fund assessments; and (b) That the City Council appoint and direct, and it does hereby appoint and direct Sharon Wood, Assistant City Manager, to file with the Board of Administration of the Public Employees' Retirement System a verified copy of this Resolution, and to perform on behalf of said Public Agency all functions required of it under the Act and Regulations of the Board of Administration; and (c) That coverage under the Act be effective on or after July 12, 2000. ADOPTED at the regular meeting of the City Council at Newport Beach, California on this day of June 2000 Signed: ATTEST: CITY CLERK Mayor RESOLUTION NO. 2000 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH ONLY WITH RESPECT TO MEMBERS OF THE NEWPORT BEACH CITY COUNCIL, FIXING THE EMPLOYER'S CONTRIBUTION UNDER THE PUBLIC EMPLOYEES' MEDICAL AND HOSPITAL CARE ACT WHEREAS (1) Government Code Section 22825.6 provides that a local agency contracting under the Public Employees' Medical and Hospital Care Act shall fix the amount of the employer's contribution at an amount not less than the amount required under Section 22825 of the Act; and WHEREAS, (2) City of Newport Beach, hereinafter referred to as Public Agency is local agency contracting under the Act for participation by members of the Newport Beach City Council; and NOW, THEREFORE, BE IT RESOLVED, AS FOLLOWS: (a) That the employer's contribution for each employee or annuitant shall be the amount necessary to pay the full cost of his/her enrollment, including the enrollment of his/her family members in a health benefits plan up to a maximum of $16.00 per month; plus administrative fees and contingency reserve fund assessments; and (b) That the City Council appoint and direct, and it does hereby appoint and direct Sharon Wood, Assistant City Manager, to file with the Board of Administration of the Public Employees' Retirement System a verified copy of this Resolution, and to perform on behalf of said Public Agency all functions required of it under the Act and Regulations of the Board of Administration; and (c) That coverage under the Act be effective on or after July 12, 2000. ADOPTED at the regular meeting of the City Council at Newport Beach, California on this day of June 2000 Signed: ATTEST: CITY CLERK Mayor RESOLUTION NO. 2000- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH DECLARING ITS INTENTION TO APPROVE AN AMENDMENT TO CONTRACT BETWEEN THE BOARD OF ADMINISTRATION CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM AND THE CITY COUNCIL CITY OF NEWPORT BEACH WHEREAS, the Public Employees' Retirement Law permits the participation of public agencies and their employees in the Public Employees' Retirement System by the execution of a contract, and sets forth the procedure by which said public agencies may elect to subject themselves and their employees to amendments to said Law; and WHEREAS, one of the steps in the procedures to amend this contract is the adoption by the governing body of the public agency of a resolution giving notice of its intention to approve an amendment to said contract, which resolution shall contain a summary of the change proposed in said contract; and WHEREAS, the following is a statement of the proposed change: To provide Section 21354 (2% @ 55 Full formula) for local miscellaneous members. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Newport Beach does hereby give notice of intention to approve an amendment to the contract between the City and the Board of Administration of the Public Employees Retirement System, a copy of said amendment being attached hereto as an "Exhibit" and by this reference made a part hereof. Passed and adopted by the City Council of the City of Newport Beach at a regular meeting held on the 13`h day of June 2000. MAYOR ATTEST: CITY CLERK A6Re,-- Ca1PERS California Public Employees' Retirement System EXHIBIT \ \II:A103311 Egli 61 � V I0I" D - I Between the Board of Administration California Public Employees' Retirement System and the City Council City of Newport Beach 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 1, 1945, and witnessed April 27, 1945, and as amended effective March 1, 1948, November 1, 1951, April 1, 1956, October 31, 1970, September 18, 1971, December 11, 1971, September 24, 1977, December 18, 1977, June 17, 1978, March 24, 1979, June 30, 1979, January 12, 1989, December 2, 1989 and June 12, 1996 which provides for participation of Public Agency in said System, Board and Public Agency hereby agree as follows: A. Paragraphs 1 through 12 are hereby stricken from said contract as executed effective June 12, 1996, and hereby replaced by the following paragraphs numbered 1 through 12 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 and age 50 for local safety members. !..EASE DO NOT SIGN "EXHIBIT ONLY' 2. Public Agency shall participate in the Public Employees' Retirement System from and after July 1, 1945 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. 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. Ocean Beach Lifeguards (included as local safety members); d. Employees other than local safety members (herein referred to as local miscellaneous members). 4. 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. CADETS; AND b. RESERVE OFFICERS. 5. The percentage of final compensation to be provided for each year of credited prior and current service as a local miscellaneous member shall be determined in accordance with Section 21354 of said Retirement Law (2% at age 55 Full). 6. The percentage of final compensation to be provided for each year of credited prior and current service as a local safety member shall be determined in accordance with Section 21362 of said Retirement Law (2% at age 50 Full). 7. Public Agency elected and elects to be subject to the following optional provisions: a. Section 20421 ( "Local Safety Member" shall include ocean beach lifeguards of a city as described in Government Code Section 20421). b. Section 21573 (Third Level of 1959 Survivor Benefits) for local miscellaneous members. %. PLEASE DO NOT SIGN "EXHIBIT ONI_ C. Section 21574 (Fourth Level of 1959 Survivor Benefits) for local safety members. d. Section 21024 (Military Service Credit as Public Service), Statutes of 1976. e. Section 21389 (Second Opportunity to Elect 1959 Survivor Benefits) for local miscellaneous members. Legislation repealed said Section effective September 27, 1979. Section 20965 (Credit for Unused Sick Leave) for local miscellaneous members. g. Section 20042 (One -Year Final Compensation). 8. Public Agency, in accordance with Government Code Section 20790, ceased to be an "employer" for purposes of Section 20834 effective on September 24, 1977. 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. 9. 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. 10. Public Agency shall also contribute to said Retirement System as follows: a. Contributions required per covered member on account of the 1959 Survivor Benefits provided under Section 21573 of said Retirement Law. (Subject to annual change.) In addition, all assets and liabilities of Public Agency and its employees shall be pooled in a single account, based on term insurance rates, for survivors of all local miscellaneous members. b. Contributions required per covered member on account of the 1959 Survivor Benefits provided under Section 21574 of said Retirement Law. (Subject to annual change.) In addition, all assets and liabilities of Public Agency and its employees shall be pooled in a single account, based on term insurance rates, for survivors of all local safety members. C. 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. d. 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. 11. 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. 12. 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' RETIRE T SYSTEM CITY OF NEWPORT BEACH BY KENNETH W ACTUARIAL PUBLIC EMP AMENDMENT PERS- CON -702A (Rev. 8 \96) BY N, CHIEF PRESIDING OFFIC :DYER SERVICES DIVISION S' RETIREMENT SYSTEM ss Date Attest: Clerk