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reason of such payment. However, such incentive payment for Classic CaIPERS members as allowable under CCR Section 571a will be reported to CaIPERS as special compensation for calculation towards retirement. 2. In the event that Ca1PERS determines that such payments do .not meet the definitions listed in CCR Section 571a as special compensation to be reported to CaIPERS, the City will convert the incentive payment for eligible employees to a meritorious step on the salary range as set. forth in section 4.8C(7) below. Any Association employee that is deemed to be a "blew Ca1PERS Member" is not eligible to have the incentive payment reported to, CaIPERS as special compensation. ;Per PERS circular 200-064-17 dated December 6, 2017, a bonus is not PERSable compensation for new members. 4. Any Association employee that is off on IOD orother leave of absence whose Performance Appraisal date occurs while off work will have"their appraisal date adjusted when returning to work for the time not worked. The employee will not be eligible for the incentive bonus payment until completing the required time in their regular position necessary to be evaluated per current departmental policy. Performance based monetary incentive payment_ amounts for Association personnel shall be recommended by the employee's Supervisor and requires the approval of both the Police Chief and City Manager. 6. The Police Chief shall be responsible for the development and administration of detailed administrative procedures and guidelines for the consistent and effective application of the Association performance appraisal evaluation criteria. Such procedures and guidelines shall define how performance objectives, measure and standards are developed; when and how performance reviews are to .be carried out; how overall performance ratings will be determined; and how performance based monetary incentive payment options are to be exercised. 7. If it determined by PERS that the "Bonus" is not.eligible to be included, as PERSable compensation, the City shall convert the bonus to two (2) additional merit based steps at increments of 2.5% for the last year that the employee earned the Bonus. The. Association understands and agrees that these steps would be merit based and employees must maintain a Significantly Exceeds Ratting to receive or maintain the 5% or Exceeds expectations rating to receive or maintain the 2.5%. Employees who do not 10 251-12