SERVICE EMPLOYEES INTERNATIONAL UNION LOCAL 721 (SEIU) (2008-2010) (1ST EXTENSION)

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11.6 Medical Retirement Subsidy Plan. C. Effective Jtljy October 1, 2007, the City's contribution toward the Medical Retirement Subsidy Plan shall increase by 0.2/0 under the conditions specified in Section 11.6A above. With this #flEIl contribution amount, the City's 1'l'\8J<i1'tl1:l1l'l contribution toward the SEIU Medical Retirement Subsidy Plan will shall equal 1.0/0 of the bargaining unit's salary base (including assignment pays). D. Effective October 1, 2008, the City shall contribute an additional 0.40% toward the Medical Retirement Subsidy Plan under the conditions specified in Section 11.6A above. With this contribution amount, the City's total contribution toward the SEIU Medical Retirement Subsidy Plan shall equal 1.40% of the bargaining unit's salary base (including assignment pays). E. Effective October 1, 2009, the City shall contribute an additional 0.35% toward the Medical Retirement Subsidy Plan under the conditions specified in Section 11.6A above. With this contribution amount, the City's total contribution toward the SEIU Medical Retirement Subsidy Plan shall equal 1.75% of the bargaining unit's salary base (including assignment pays). AMENDED ARTICLE XII (new language in bold) 12.2 Deferred Retirement. The City will continue to make payment to CalPERS on behalf of each affected employee, in an amount necessary to pay one hundred percent (100/0) of his or her individual retirement contribution which currently is equal to seven percent (7/0) and will increase to eight percent (8%), effective January 1, 2009. Such payments shall be credited to the individual employee's CalPERS account. Such payments are not increases in base salary and no salary rate range applicable to any of the employees covered by this Agreement shall be changed or deemed to have been changed by reason thereof. As a result, the City will not treat these payments as ordinary income and, thus, will not withhold Federal or State income tax from said payments. The City has received an opinion or ruling from the Internal Revenue Service confirming that these payments are deferred compensation, and not ordinary income. In the event that the City receives a ruling from the Internal Revenue Service that such payments are ordinary income of the employees instead of deferred compensation, the City's obligation to make such payments shall discontinue, and in place thereof, the base salary of each said employee shall forthwith be increased by fourteen (14) salary rate ranges (7/0), or sixteen (16) salary rate ranges (8%), after January 1, 2009.