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ARTICLE XII <br />12.0 RETIREMENT <br />12.1 General. The terms of the existing contract between the City and California Public <br />Employees' Retirement System (CaIPERS) governing the City retirement benefits for <br />employees are incorporated by reference herein. The City shall continue to make <br />contributions to (CaIPERS) in accordance with its contract with CaIPERS for employees <br />covered by said contract as amended. <br />12.2 Deferred Retirement. The City shall continue to make payment to CaIPERS on behalf of <br />each employee covered by this MOU in accordance with the following schedule: <br />A. With respect to Miscellaneous employees covered by this MOU who do not qualify <br />as "New Members" under the California Public Employees' Pension Reform Act <br />of 2013 (PEPRA), the City shall pay an amount necessary to pay one hundred <br />percent (100%) of his or her individual retirement contribution which is equal to <br />eight percent (80/o). <br />Such payments shall be credited to the individual employee's CaIPERS account. <br />Such payments are not increases in base salary and no salary rate range applicable <br />to any of the employees covered by this MOU shall be changed or deemed to have <br />been changed by reason thereof. As a result, the City will not treat these payments <br />as ordinary income and, thus will not withhold Federal or State income tax from <br />said payments. The City has received an opinion or ruling from the Internal <br />Revenue Service confirming that these payments are deferred compensation, not <br />ordinary income. <br />For the purpose of reporting an employee's compensation to CaIPERS, the City <br />shall include these payments as if they were a part of the employee's base salary. <br />12.3 Credit for Unused Sick Leave. Employees covered by this MOU, can have unused <br />accumulated sick leave at the time of retirement convened to additional service credit at <br />the rate of 0.004 years of service credit for each day of unused sick leave (i.e., 200 days of <br />sick leave equals .8 additional years of service credit). The City must report only those <br />days of unused sick leave that were accrued by the employee during the normal course of <br />employment. This section applies to members whose effective date of retirement is within <br />four (4) months of separation from employment. <br />12.4 Military Service Credit as Public Service. Employees covered by this MOU may elect to <br />purchase up to four (4) years of service credit for any continuous active military or <br />merchant marine service prior to employment. The employee must contribute an amowlt <br />equal to the contribution for current and prior service that the employee and the employer <br />would have made with respect to that period of service. <br />Ell <br />