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appointed to their classification on or after January 1, 2013, and who are defined as <br />new members under the California Public Employees' Pension Reform Act (PEPRA) of <br />2013 (AB340), with the 2.7% @ 57 Service Retirement benefit. <br />I. Payment of 2.7% at 57 Service Retirement Benefit, Executive Management <br />(EM) employees defined in 6.H. (above) will contribute at least 50% of normal cost of <br />the 2.7% at 57 retirement benefit. <br />Pre -Taxable Benefit. To the extent permitted by CalPERS and Internal Revenue Service <br />regulations, the City will make the above employee deductions pre-tax contributions. <br />J. Final Compensation for Pension Calculation. Final compensation for Classic <br />Safety and Classic Miscellaneous Members will be based on the highest annual <br />average compensation earnable during the 12 consecutive months immediately <br />preceding the effective date of his or her retirement, or some other 12 consecutive <br />month period designated by the member. <br />Final compensation for Safety and Miscellaneous Members who are defined as New <br />Members under PEPRA will be based on the highest annual average compensation <br />earnable during the 36 consecutive months immediately preceding the effective date of <br />his or her retirement, or some other 36 consecutive month period designated by the <br />member. <br />K. MilitarV Service Credit as Public Service. An Executive Management (EM) <br />employee covered by this Resolution will be permitted to purchase up to four (4) years of <br />service credit for any continuous active military or merchant marine service prior to <br />employment. The cost to purchase this service credit is subject to CalPERS Regulations <br />and calculated using a present value method. <br />L Deferred Retirement for Classic Safety and Classic Miscellaneous Members as <br />defined in Section B and F (above). The City will continue to make payments to <br />CalPERS on behalf of each eligible affected employee in an amount necessary to pay <br />one hundred percent (100%) of his or her individual retirement contribution which is <br />equal to eight percent (8%) of reportable compensation for Classic Miscellaneous <br />Members and nine percent (9%) for Classic Safety Members. Such payments will be <br />credited to the individual employee's CaIPERS account. <br />Such payments are not an increase in base salary and no salary rate range applicable <br />to any of the employees covered by this Resolution will be changed or deemed to have <br />been changed by reason thereof. As a result, the City will not treat these payments as <br />ordinary income and thus will not withhold federal or state income tax from said <br />payments. The City previously received a ruling from the Internal Revenue Service <br />confirming that such payments are deferred compensation and not ordinary income. In <br />the event that the City receives a new ruling from the Internal Revenue Service that <br />such payments are ordinary income of the employees instead of deferred <br />compensation, the City's obligation to make such payments will discontinue and in place <br />thereof the reportable compensation of each Classic Miscellaneous Member eligible for <br />Resolution No. 2015-001 <br />Page 9 of 15 <br />