HomeMy WebLinkAboutAmendment-81-78AMENDMENT TO CONTRACT 'R.ETWEEN THE
BOARD OF ADMINISTRATTON
PUBLIC EMPLOYF:F,S' RETTRUI;N^I SYSTEM
AND THE
CITY COUNCIL
OF THE
CITY OF SANTA ANA
The Board of Administration, Public Employees' Retirement System, herein-
after referred to as Board, and the governing body of above public agency,
hereinafter referred to as Public Agency, having entered into n contract under
date of November 25, 1946, effective July 1, 1947, and as amended effective
October 1, 1951, February 1, 1954, September 1, 106, July 1, 1959, November 1,
1960, September 1, 1963, April 1, 1964, February 1, 1965, January 16, 196e,
November 1, 1970, June 1, 1974, December 15, 1976 and December 1, 1918, which
provides for participation of Public Agency in seid System, Board and Public
Agency hereby agree as follows:
A. Psrngrnphrs 1 through 11 ere hereby stricken from said contract ns executed
effective December 1, 1978, and hereby replaced by the following paragraphs
numbered 1 through 11 inclusive:
1. All words and terms used herein which are defined in the Public
Employees' Retirement Law shall have the meanings as defined therein
unless othersai,se specifically provided. "Normal retirement age" shall
meen age 60 for local miscellaneous and age 50 for local safety
members.
2. Public. Agency shall participate in the Public Employees' Retirement
System from and after July 1, 1947 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 such as by express
provisions thereof apply only on the election of contracting agencies.
'. 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 Firemen (herein referred to as :local safety members);
b. Local. Policemen (herein referred to as Local safety members)
c. Employees other than local safety members (herein referred to as
local miscellaneous members).
In addition to the classes of employees excluded from membership by
said Retirement Law, thn-following cl ewes of employees :shall not
become members of said Retirement SyNvon:
NO ADDITTONAL EXCLUSTONS
4. The freotlo f Me! compensation to be prc ed for each year of
credited prior and current serhoe as a local miscellaneous member
shall be determined in accordance with Section 21251.15 of Said
Retirement Law (2% at age 60 Full).
5. The fraction of final compensation to be provided Or each year of
credited prior and current service as a local safety member shall be
determined in accordance with Section 21252.01 of said Retirement Law
(2% at age 50 Pull), for those local safety members employed prior to
the date of this contract amendment.
6. The fraction 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 21252.6 of said Retirement Law
(A at age 55 Full), for those local safety members first employed on
or after the effective date of this contract amendment.
7. The following Additional provisions of the Public Employees' Retire-
ment Law which apply only upon election of a contracting agency shall
apply to the Public Agency and its employees*
8. Sections 21180-21387, (1959 Survivors Program), excluding Section
21420 (lncreased 1959 Survivors benefits).
b. Sections P1261/2126TO (Post-retirement survivor allowance).
C. Section 20970.3 (Militan service credit) as defined in Chapter
1417, Statutes of 1974, for those local miscellaneous and safety
members first employed prior to the date of this contract emend -
went.
d. Section 20981.6 (Waiver of age 70 retirement) for local miscel-
laneous members only.
e. Section 20461.6 (Reduction of benefits) applied to Section
21252.01 for future safety employees and Section 20910.3 for
future miscellaneous and safety employees.
S. Public Agency, in accordance with Section 20740, Government Code,
ceased to be an "employer" for purposes of Chapter 6 of the Public.
Employees' Retirement Law effective on December 16, 1976. Accumulated
contributions of Public Agency as of the afornmantloned date shall be,
fixed and determined as Provided In Section 20759, Government Code,
and accumulated contributions as of the aforementioned date and
Contributions thereafter made shall be held by the Board an provided
in Section 20759, Government Code*
9. Public Agency shall contribute to said Retirement System as follows -
a. With respect to Miscellaneous members, the agency shall con-,
tribute the following percentages of monthly salaries earned as
misoellnnpous members of said Retirement System*
(1) 0,178 percent until June 10, 2000 on account of the
Anbill"ty for. ','P'rifhd'
Orvice benefits.
I3-70 percent onlAdcount of the liability for current
service benefits.
(3) 0.219 percent on account of the Mability for the 1959
Survivor Program.
b. With respect to local safety members, the agency shal1 contribute
the following percentages of monthly salaries earned as local
safety members of said Retirement: System.-
(1)
ystem:
(1) 0.017 percent until June 70, 2000 on account of the
liability for prior service benefits.
(2) 28.174 percent on account of the liability for current
service benefits.
C. A reasonable amount per annum, as fixed by the Board to cover the
coats of administering said System as it affects the employees of
Public Agency, not including the costs of special valuations or
Of the periodic inve=stigation and valuations required by law.
d. A reasonable amount as fixed by the Board, payable in one install-
ment .as the occasions arise, to cover the costs of special valua-
tions on account of Employees of Public. Agency, and costs of the
periodic investigation and valuations required by law.
10. 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, end on account of the experience under the
Retirement System as determined by the periodic investigation and
valuation required by said Retirement Law..
11. Contributions required of Public Agency and its employees shall be
paid by Public Agency to the Retirement System within thirty days
after the end of the period to which said contributions refer or as
may be prescribed by Board regulation. Tf more or less then the cor-
rect amount of contributions is paid for, any period, proper adjustment
shall be made=, in connection with subsequent remittances, or adjust-
ments on account of errors in contributions required of any employee
may be made by direct cash payments between the employee and the
Board. Payments by Public. Agency to 'board may be made in the form of
warrants, bank checks, bank drafts, certified checks, money orders or
cash.
B. This amendment shall be attached to said contract and shall be effective on
the 1st p day of October 19 8%
Witness our hands the _01A � day of f , 116.
BOARD OF ADMINISTRATION CITY COUNCIL
PUBLIC PAIPLOYEPS' RET PUMENT `iYSTPM OF THE
CITY OF SANTA ANA
By B1.4 a 4' 7
Car T. ginger, Qycutive officer residi _ Officer
Approved as to form: ,
Attest;
lark
PERS COAT -702
STATE OF CALIFORNIA—BOARD OF ADMINISTRATION EDMUND G. BROWN JR., Governor
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
1416 NINTH STREET, P.O. BOX 1953
SACRAMENTO, CALIFORNIA 9BB09
Telephone (916) 445-6570 Reply to Section 250
Contracts Division
September. 16, 1981
Mr. D.E. Bott
Director of Personnel
City of Santa Ana
20 Civic Center Plaza
Santa Ana, CA 92701
Dear Mr. Bott:
Agency #0137
The amendment to the contract between your agency and the Public Employees' Re-
tirement System to provide Section 20461.6 (Reduction of benefits for future
employees) applicable to a reduction in formula from 2% Q 50 to 2% @ 55 for
local safety members and Section 20930.3 (Military service credit, Statutes of
1974) for local miscellaneous and local safety members, has been executed by
our office. A copy of the contract as amended is enclosed for your file. The
effective date of this amendment is October. 1, 1981.
If I can be of any further assistance, do not hesitate to contact me.
Sincerely,
T ife Morrill
C tracts Division
JDM:ddw / 7
Attachment
' �J
4,9
a
STATE OF CALIFORNIA—BOARD OF ADMINISTRATION EDMUND G. BROWN JR., Governor
PUBLIC EMr'LOYEES' RETIREMENT SYSTEM
1416 NINTH STREET, P.O. BOX 1953
SACRAMENTO, CALIFORNIA 95609
Telephone (916) 445-6570 Reply to Contracts Division
August 10, 1981
Mr. D.E. Bott
Director of Personnel
City of Santa Ana
20 Civic Center Plaza
Santa Ana, CA 92701
Dear Mr. Bott:
Employer Code #137
This will acknowledge receipt of your governing body's Resolution of Intention
to amend ,your contract with this System as follows:
To provide Section 20461.6 (Reduction of benefits for future
employees) from 2% @ 50 to 2% @ 55; for local safety members only and
Section 20930.3 (Military service credit) as defined in Chapter 1437,
Statutes of 1974, for those local miscellaneous and safety members
first employed on or after the effective date of this contract
amendment.
We are sending to you the following documents in order to complete the proposed
amendment:
Amendment to Contract, Form 702, in duplicate. Please sign and return
both copies to this System.
2. Ordinance, Form CON -11, in duplicate, approving amendment to contract.
This Ordinance must be adopted by affirmative vote of a majority of
the members of the governing body no earlier than twenty days after
the adoption of the Resolution of Intention. The number of days and
publications are to be inserted in Section 3 of the form to comply
with local requirements. We want to direct your attention to the fact
that the Ordinance will not become effective until 30 days after
adoption. One copy is to be completed and returned to this System.
3. Certification of Final Action by the Governing Body, Form CON -5. One
copy is to be completed and returned to this System.
Effective date of the amendment cannot be earlier than the first day of a
payroll period following the effective date of the Ordinance. Please insert the
effective date of the amendment on the last page of the Amendment to Contract.
Please be sure to notify your accounting division regarding any rate change
because of the amendment.
In summary, the following documents must be returned to this office: (original
signatures are required on all documents).
1. Amendment to contract, Form 702. Two complete sets - 1 original, 1
carbon. Please verify your effective date with your accounting
section.
2. Form CON -11, Ordinance - original or certified copy.
3. Form CON -5, Certification of Final Action - original or certified copy.
A copy of the contract will be returned for your records after it has been
signed by our Executive Officer.
Please let us know if you have any questions.
Yours truly,
Ellen 11. Baltezore, Chief
Contracts Division
EHB:tmr
Enclosures
cc: San Diego Area Office
REQUEST FOR
COUNCIL ACTION
CITY COUNCIL
AGENDA DATE June 12, 1981
TITLE PROPOSED AMENDMENT TO THE CITY'S
CONTRACT WITH THE PUBLIC EMPLOYER'S
RETIREMENT SYSTEM (PERS).
D !• COUNCILACTION
CLERK OF THE COUNCIL
1. Receive and file the attached Actuarial Valuation Report prepared by the
Public Employee's Retirement System (PERS) regarding estimated future reductions in
City retirement plan costs if the current 2% at Age 50 benefit formula is reduced to
the 2% at Age 55 formula for future Police and Fire safety -member employees.
2. Adopt the attached Resolution declaring Council's intention to approve an
amendment to the City's contract with PERS to adopt the 2% at Age 55 formula for
new police and fire safety -member employees and to delete the Military Service
Credit option for all personnel employed on or after the effective date of such
contract amendment.
3. Adopt the attached Ordinance authorizing the above specified amendments to
the contract between the City and PERS.
EXECUTIVE SUMMARY
The above recommended actions will further Council's goal of reducing the overall
retirement plan costs for City employees by adopting a substantially less expensive
retirement benefit formula for future Police and Fire safety -member personnel.
Deletion of the Military Service Credit option for all new employees will eliminate
a discriminatory and potentially counter-productive benefit that adds little or
nothing to the maintenance of an adequate, competitive retirement program.
The contract amendment process specified in the California Public Employees'
Retirement Law requires that the above actions be taken in the sequence listed
above in the "Recommended Action" section.
NOTE: In accordance with provisions of the current labor agreements between the
City and its recognized employee associations, the City must take these actions
during the term of the agreements which expire on June 30, 1981.
I
To: A. J. Wilson, City Manager
Date: June 12, 1981
From: D. E. Bott, Dir. of Personnel
PROPOSED P.E.R.S. CONTRACT AMENDME SAFETY -MEMBER RETIREMENT FORMULA
Subject;_ AND MILITARY SERVICE CREDIT OPTION.
Included in the existing Memoranda of Understanding (M.O.U.'s) between the City and
each of its three recognized employee associations, is a provision which allows
the City to provide, under certain conditions, a new retirement plan for future
employees involving different benefits and/or lower costs than currently exist for
present employees. The option was conditioned upon (1) a change in the State
Retirement Law which would permit such a change to occur, (2) a study of retirement
plans which provide benefits equal to those prevailing for equally compensated employ-
ees in private industry in Orange County, (3) selection of a plan meeting those
criteria, and (4) notification of the Associations of the plan selected at least 60
days before the plan is instituted for employees hired after the effective date of
the new plan.
The first condition was met when, in January 1980, a change in the Retirement Law
permitted PERS contracting agencies to provide reduced benefits for future employees.
As a result of some early confusion regarding the scope of the application of the legis-
lation, PERS officially notified its contracting agencies in May 1980 that the new "two-
tier system affected only the optional benefits that agencies had previously adopted
to improve upon the basic PERS benefit structure. Agencies could not, as they had
hoped, exclude their future employees only from their PERS contracts as a means of
providing reduced benefits for such employees. The City of Santa Ana's contract with
PERS included only two (2) such options. One, allowing PERS service credit for up
to four (4) years military service and available to all current employees, could be
terminated. The other, providing the 2% at Age 50 service retirement formula for
Safety members, could only be reduced to the lesser 2% at 55 formula.
The second condition was met when Council received the results of the comparative
study of the benefits and relative costs of retirement plans in a representative
sample of private sector employers in Orange County. The study, conducted at Coun-
cil's direction by the accounting/actuarial consulting firm of Coopers & Lybrand,
provided the necessary basis for Council to select an alternate plan for future
employees. That selection, however, was limited to only one alternative. The new
PERS two-tier system did not permit contracting agencies to exclude, new employees
only from the PERS system and the City's agreement with the employee associations
did not grant the City the right to withdraw existing employees from PERS and trans-
fer them to a private plan. Therefore, the City was limited to reducing the two
optional benefits included in its PERS contract. On April 9, 1980, Council author-
ized PERS to develop an actuarial valuation study as the legally required first step
toward implementing that change. Thus, the third condition was met.
The remaining condition of notifying the employee associations to explain the proposed
retirement plan modifications in advance of their implementation has already been
satisfied. The Associations were notified of Council's proposed action on April 9th
and each has acknowledged their understanding of the intent and meaning of the change.
The PERS contract amendment process is highly structured and very time-consuming.
It normally takes nine months to a year to effect a single amendment. Because the
City of Santa Ana did not initiate the process until February 18, 1981, the System
has been giving us expedited service so that we may be able to complete the necessary
K
A. J. Wilson
June 12, 1981
Page Two
legal steps to effect the change prior to June 30th when the City's authority to
act will expire. However, while PERS has been able to provide the valuation data
pertaining to the reduction in the Safety -member benefit formula to 2% at Age 55,
they will be unable to provide it regarding the elimination of the "Military
Service Credit" option. The Contracts Division of PERS informed me last week
that the System had to develop a new computer program to valuate the effect of
deleting that option (in response to requests from our agency and two others) and
that the program has failed to work. Their technicians have not been able to
determine the cause of the failure and cannot give an estimate of when the problem
will be solved. This development, however, will not prevent the City from adopting
both changes at this time. We just will not know what the estimated future savings
will be regarding the deletion of that particular option for another 60-90 days.
0
D. E.
Bott
Director of
Personnel
0
STATE OF CALIFORNIA EDMUND G. BROWN JR., Governor
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
1416 NINTH STREET, P.O. BOX 1953
SACRAMENTO, CALIFORNIA 95809 0
Telephone (916) 445-6570 Reply to Contracts Division
June 12, 1981
Mr. D.E. Bott
Director of Personnel
City of Santa Ana
20 Civic Center Plaza
Santa Ana, CA 92701
Dear Mr. Bott:
Employer Code #,E0137
We are enclosing two copies of Resolution of Intention (Form 122) to amend your
agency's contract as follows:
To provide Section 20461.6 (Reduction of benefits for future employees)
from 2% @ 50 to 2% @ 55; for local safety members only and Section
20930.3 (Military service credit) as defined in Chapter 1437, Statutes.
of 1974, for those local miscellaneous and safety members first em-
ployed on or after the effective date of this contract amendment.
Also enclosed are the following required forms:
Form CON• -12, Certification of Governing Body's Action.
2. Form CON -30, Certification of Compliance With Government Code Section
20461.6.
The enclosed Form CON -11, Sample Ordinance is intended to be used as a guide
only and is included to allow you sufficient time to prepare your Ordinance for
a first and final reading. The Resolution of Intention and accompanying docu-
ments should not be held pending final reading of the Ordinance.
It is important to note that there will be no immediate reduction in the em-
ployer contribution rate after a contract amendment under Section 20461.6. The
rate reduction will not be apparent until there is a substantial change in the
employee data.
As soon as we receive one executed copy of the Resolution of Intention (with
attached exhibits), Certification of Governing Body's Action (Form CON -12),
and any other required forms, we will forward additional copies of the amend-
ment and the documents necessary to complete your governing body's final
action. That final action will require an affirmative vote of the majority of
your governing body and must be deferred for at least twenty days after the
adoption of the Resolution of Intention.
In summary, the following documents must be returned to this office before we
can forward final documents to you: (original signatures are required on all
of these documents)
1. One executed copy of the Resolution of Intention (with attached
Exhibits), original or certified copy.
2. Certification of Governing Body's Action (Form CON -12), original or
certified copy.
3. Certification of Compliance With Government Code Section 2.0461.6 (Form
CON -30), original or certified copy.
Effective date of the amendment cannot be earlier than the beginning of a
payroll period following the effective date of the final action of your
governing body.
If you have any questions regarding this letter or the enclosed material,
please do not hesitate to contact us.
Yours truly,
S gv Zx�lez.-
Ellen H. Baltezore, Chief
Contracts Division
EHB:tmr
Enclosures
cc: San Diego Area Office
RESOLUTION OF INTENTION TO APPROVE AN
AMENDMENT TO CONTRACT BETWEEN THE
BOARD OF ADMINISTRATION OF THE
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
AND THE
CITY COUNCIL
OF THE
CITY OF SANTA ANA
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 them-
selves and their employees to amendments to said Law; and
WHEREAS, one of the steps in the procedure to amend this contract is the
adoption by the legislative body of the public agency of a resolu-
tion 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 20461.6 (Reduction of benefits for
future employees) from 2% @ 50 to 2% @ 55; for local
safety members only and Section 20930.3 (Military
service credit) as defined in Chapter 1437, Statutes
of 1974, for those local miscellaneous and safety
members first employed on or after the effective date
of this contract amendment.
NOW, THEREFORE, BE IT RESOLVED, that the governing body of the above agency
gives, and it does hereby give notice of intention to approve an
amendment to the contract between the said governing body 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.
---(-TITLE
TDats adopted and approved Ret. Form 122
CERTIFICATE
OF COMPLIANCE WITH
SECTION 20461.6, GOVERNMENT CODE
In accordance with Section 20461 .6, Government Code and amendment dated
(pending) to the contract between the City of Santa
! name of
Ana and Public Employees' Retirement System, the City
agency governing
Council hereby certifies that:
body
1. The City of Santa Ana has fully discharged all of
name of agency
s
~
the obligation imposed by Chapter 10 (commencing with Section 3500)
of Division 4 of Title 1.
Or' in 1 signature
Gordon Bricken
Mayor, City of Santa Ana
Official title
Date: . July 17, 1981
At: Sa to Ana
Atteat:
, CA
erc o ;e u ci�
CON -30
CERTIFICATION OF GOVERNING BODY'S ACTION
hereby certify that the foregoing is a true and correct copy
of a Resolution adopted by the
Governing Body)
of the _.City of Santa"Ana
(Name of Public Agency)
on June 29, 1981 appearing at Page 198
(Date)
Volume of the (Minutes) Oaf(1KMD*1K)WWUW of the
CitCoid
ne
(Governing Body)
CITY CLERER �m
Secretary of theo7761
PERS-CON-12 (11177)
MEMORANDUM`
To: CITY COUNCIL
From: Clerk of the Council
Subject: AGENDA ITEM NO. 58 - PERS AMENDMENT
Date: June 12, 1981
Attached is a sample packet of materials relating to the proposed amendment
to the City's contract with the Public Employers Retirement System.
Final documents will be available at the City Council meeting on Monday.
Attach.
nbd
J C)
U
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
Contract Services Division
Public Agency Contract Services
P. O. Box 942709
Sacramento, CA 94229-2709
(916) 326-3420
(916) 326-3240 (TDD)
CERTIFICATION OF COMPLIANCE WITH
GOVERNMENT CODE SECTION 7507
I hereby certify that in accordance with Section 7507 of the Government Code the future annual
costs as determined by the System Actuary and/or the increase in retirement benefit(s) have been
made public at a public meeting of the City Council
(governing body)
of the City of Santa.Ana
(public agency)
on which is at least two weeks prior to the adoption of the
(date)
Resolution / Ordinance.
Date
Zierk/Secretary
Clerk of the Council
Title
PERS-CON-12A
C0601 (Rev. 12/92)
RESOLUTION NO. 81-97
A RESOLUTTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA
DECLARING INTENTION TO APPROVE AN AMENDMENT TO THE CONTRACT
BETWEEN THE CITY COUNCIL OF THE CITY OF SANTA ANA AND THE
BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES'
RETIREMENT SYSTEM
i
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 procedure to amend this contract.is the
adoption by the legislative 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 20461.6 (Reduction of benefits for
future employees: from 2% @ 50 to 2% @ 55; for local
safety members only and Section 20930.3 (Military service
credit) as defined in Chapter 1437, Statutes of 1974,
for those local miscellaneous and safety members first \
employed on,or after the effective date of this contract
amendment. '
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Ana:
1. That the City Council of the City of Santa Ana gives, and it does hereby
give notice of intention to approve an amendment to the contract between the said
governing body 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.
2. That this Resolution shall be operative from and after June 15, 1981.
ADOPTED this 29th day of June 1981, by the following vote:
AYES: Acosta, Bricken, Griset, Luxembolurger, Markel, McGuigan, Serrato
NOES: None
ABSENT: None
MAYOR
ATTEST:
JRJK OF THECOUNCIL
ED AS TO FORM:
CITY ATTORNEY
STATE OF CALIFORNIA EDMUND G. BROWN JR., Governor
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
1416 NINTH STREET, P.O. BOX 1953
SACRAMENTO, CALIFORNIA 95809
Telephone (916) 322-6689 Reply to Section 250
Contracts Division
June 11, 1981
Mr. D.E. Bott
Director of Personnel
City of Santa Ana
20 Civic Center Plaza
Santa Ana, CA 92701
Dear Mr. Bott:
We are transmitting with this letter our actuarial report on the valuations re-
quested by your agency to determine the contributions required if the contract
is amended in accordance with the attached report.
There are two elements to employer contribution rates -- a normal cost contribu-
tion rate and a contribution rate to amortize the unfunded liabilities. The
calculations show a decrease in cost due to a reduction in benefits for future
employees. This decrease is recognized by comparing the normal cost contribu-
tion rate for present benefits (all employees at the higher level of benefits)
with the normal cost contribution rate for the proposed benefits (all employees
at the reduced level of benefits). The normal cost contribution rate is the
only element of the rate which is affected by the reduction in benefits for fu-
ture employees because unfunded liabilities are not generated at the time new
employees are hired.
While the cost savings due to reduced benefits for future employees is shown by
the decrease in the normal cost, any current unfunded liability or future un-
funded liability which may develop must also be included in the new rate.
Changes in future unfunded liability may be generated because of additional
changes in benefits, changes in actuarial assumptions, or agency experience
different from the actuarial assumptions. Therefore, your new rate will consist
of the normal cost for your current employees at the present benefit level, the
reduced normal cost for future employees and a rate to amortize any unfunded
liabilities that may develop for your present or future employees.
The actual decrease in employer contribution rate due to the reduced level of
benefits for future employees will not be noticed until your agency begins to
employ new employees on the reduced benefit level, and even then the decrease
will be gradual.
Mr. D.E. Bott
June 11, 1981
Page 2 of 2
You will be billed at a later date for the services involved in the conduct of
this valuation.
If you have any questions regarding the enclosed material, please don't hesitate
to contact me at (916) 322-6689.
Yours truly,
KarenDeFrank,
Valuations Section
CONTRACTS DIVISION
KMD:ddw
Enclosures
cc: San. Diego Area Office
PUBT,C EMPLOYEESf RETIREMENT F' TELA ACTUARIAL VALUATION REPORT
PE -M -CON -11w (Rev. 4-78)
AGENCY NAME CITY OF SANTA ANA EMPLOYT,R NO. 137
SAFETY MEMBERS
PRESENT BENEFITS
A. VALUATION SPECIFICATIONS 1978 ASSUMPTIONS
1. Actuarial data as of 6/3080
2. Formula Full 2% @ 50
3. Final Compensation Average 3 Years
4. 1959 Survivor Benefits Yes
5. Post-retirement Survivor Benefits Yes
6. Military Service Credit Yes
B. AGENCY CONTRIBUTION RATE FOR CURRENT
SERVICE (as n of member payroll
a. Retirement benefits 28.141%
b, Death benefits 0.038%
c. 1959 Survivor Benefits -0-
C. AGENCY CONTRIBUTION FOR PRIOR SERVICE
a. Contribution rate as ? of member
payroll until 6 30 2000 0.037%
D. TOTAL AGENCY CONTRIBUTIONS
a. Total Agency Contribution Rate: 28.216%
E. ACTUARIAL VALUATION FEE _--_-
IISUK YANG
,lune 5. 1981 CHIEF ACTUARY.
DATE
rrn:o^ wP�- I ;} i ,f ev. j zsv/
AGENCY NAME: — CITY OF SANTA ANA _..... _. .___. v_.EMPLOYER NO. _ 137
SAFETY MEMBERS
PRESENT BENEFITS SECTION 20461.6
1978 ASSUMPTIONS PROPOSED BENEFITS
1978 ASSUMPTIONS
A. VALUATION SPECIFICATIONS
1. Actuarial data as of 6/30/80
2. Formula
Full 2% @ 50
Full 2% @ 55
3. Final Compensation Average
3 Years
3 Years
4. 1959 Survivor Benefts
Yes
Yes
5. Post-reitrement Survivor Benefits
Yes
Yes
6. Military Service Credit
Yes
Yes
B. AGENCY NORMAL COST CONTRIBUTION RATE
FOR CURRENT SERVICE (as % of member
payroll ��~_
a. Retirement benefits
18.306%
A 12.455%
b. Death benefits
0.03$x__
__ 0.036%
C. 1959 Survivor benefits
_n_
_n_
C. TOTAL AGENCY NORMAL COST CONTRIBUTIONS:
D. ACTUARIAL VALUATION FEE
E. ACTURIAL VALUATION DATE: June 5, 1981
KISUK YANG,
CHIEF ACTUARY
344%
12.491
$ 653.00
REL: id
6/12/81
ORDINANCE NO. NS— 1588
AN ORDINANCE OF THE CITY OF SANTA ANA AUTHORIZING
AN AMENDMENT TO THE CONTRACT BETWEEN THE CITY
COUNCIL OF THE CITY OF SANTA ANA AND THE BOARD
OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES
RETIREMENT SYSTEM
THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES
ORDAIN AS FOLLOWS:
SECTION l: That an amendment to the contract between
the City Council of the City of Santa Ana and the Board of
Administration, California Public Employees Retirement System
is hereby authorized, a copy of said amendment being attached
hereto, marked "Exhibit A" and by such reference made a part
hereof as though herein set out in full.
SECTION 2: The Mayor of the City Council of the
City of Santa Ana is hereby authorized, empowered, and directed
to execute said amendment for and on behalf of said Agency.
SECTION 3: This ordinance shall take affect 30
days after the date of its adoption, and prior to the expiration
of 15 .days from the passage hereof shall be published at
least once in the Register, a newspaper of general circulation,
published and circulated in the City of Santa Ana and thenceforth
and thereafter the same shall be in full force and effect.
ADOPTED this 20th day of
1981, by the following vote:
July
AYES: COUNCILMEMBERS: Acosta, Bricken, Griset,
Luxembourger, Markel, McGuigan, Serrato
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: None
ATTEST:
c�
,GORDON BRICKEN, MAYOR
YCERX OF THE COUN IL
APPROVED AS TO FORM:
-11r4lx
DWARD CO PER
City Attorn
AMENDMENT TO CONTRACT BETWEEN THE
BOARD OF ADMINISTRATION
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
AND THE
CITY COUNCIL
OF THE
CITY OF SANTA ANA
The Board of Administration, Public Employees' Retirement System, herein-
after referred to as Board, and the governing body of above public agency,
hereinafter referred to as Public Agency, having entered into a contract under
date of November 25, 1946, effective July 1, 1947, and as amended effective
October 1, 1951, February 1, 1954, September 1, 1956, July 1, 1959, November 1,
1960, September 1, 1963, April 1, 1964, February 1, 1965, January 16, 1969,
November 1, 1970, June 1, 1974, December 16, 1976 and December 1, 1978, which
provides for participation of Public Agency in said System, Board and Public
Agency hereby agree as follows:
A. Paragraphs 1 through 11 are hereby stricken from said contract as executed
effective December 1, 1978, and hereby replaced by the folloling paragraphs
numbered 1 through 11 inclusive: A
1. All words and terms used herein which are definethe Public
Employees' Retirement Law shall have the meani defined therein
unless otherwise specifically provided. "Nor4o retirement age" shall
mean age 60 for local miscellaneous and ages for local safety
members. y
: r'J
2. Public Agency shall participate in th�Vublic Employees' Retirement
System from and after July 1, 1947king its employees as hereinafter
provided, members of said Syste��,,(iiJect to all provisions of the
Public Employees' Retirement��xcept such as apply only on election
of a contracting agency andnot provided for herein and to all
amendments to said Law hereof er enacted except such as by express
provisions thereof apply only on the election of contracting agencies.
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
Firemen (herein referred to
as
local safety members);
b.
Local
Policemen (herein referred
to
as focal safety members);
C. Employees other than local safety members (herein referred to as
local miscellaneous members).
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:
NO ADDITIONAL EXCLUSIONS
4. The fraction -t' final -compensation to be prov"ed frn ach year of
credited pr. and current a vice as a loca. iscellaneous member
shall be determined in accq�r`dance with Section 21251.13 of said
Retirement Law (2% at age "60 Full).
5. The fraction 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 21252.01 of said Retirement Law
(2% at age 50 Full), for those local safety members employed prior to
the date of this contract amendment.
6. The fraction 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 21252.6 of said Retirement Law
(2% at age 55 Full), for those local safety members first employed on
or after the effective date of this contract amendment.
7. The following additional provisions of the Public Employees' Retire-
ment Law which apply only upon election of a contracting agency shall
apply to the Public Agency and its employees:
a. Sections 21380-21387, (1959 Survivors Program), excluding Section
21382.2 (Increased 1959 Survivors benefits).
b. Sections 21263/21263.1 (Post-retirement survivor allowance).
C. Section 20930.3 (Military service credit) as defined in Chapter
1437, Statutes of 1974, for those local miscellaneous and safety
members first employed prior to the date of this contract amend-
ment.
d. Section 20983.6 (Waiver of age 70 retirement) for local miscel-
laneous members only.
e. Section 20461.6 (Reduction of benefits) applied to Section
21252.01 for future safety employees and Section 20930.3 for
future miscellaneous and safety employees.
8. Public Agency, in accordance with Section 20740, Government Code,
ceased to be an "employer" for purposes of Chapter 6 of the Public
Employees' Retirement Law effective on December 16, 1976. Accumulated
contributions of Public Agency as of the aforementioned date shall be
fixed and determined as provided in Section 20759, Government Code,
and accumulated contributions as of the aforemention.4 date and
Contributions thereafter made shall be held by the #rd as provided
in Section 20759, Government Code. -a
9. Public Agency shall contribute to said RetiremQ�W System as follows:
a. With respect to miscellaneous members, the agency shall con-
tribute the following percentages Of t��thly salaries earned as
miscellaneous members of said Retirefgpint System:
(1) 0.178 percent until June 30,%W'�"600 on account of the
liability for prior servicenefits.
(2) 13.783 percent on accout&!Kf the liability for current
service benefits.�.I.
(3) 0.218 percent on account of the liability for the 1959
Survivor Program.
b. With re _act to local safety members, tl, agency shall contribute
the following percentalges'of monthly salaries earned as focal
safety members of said Retirement System:
(1) 0.037 percent until June 30, 2000 on account of the
liability for prior service benefits.
(2) 28.179 percent on account of the liability for current
service benefits.
C. A reasonable amount per annum, as fixed by the Board 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 install-
ment as the occasions arise, to cover the costs of special valua-
tions on account of employees of Public Agency, and costs of the
periodic investigation and valuations required by law.
10. 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.
11. Contributions required of Public Agency and its employees shall be
paid by Public Agency to the Retirement System within thirty 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 cor-
rect amount of contributions is paid for any period, proper adjustment
shall be made in connection with subsequent remittances, or adjust-
ments on account of errors in contributions required of any employee
may be made by direct cash payments between the employee and the
Board. Payments by Public Agency to Board may be made in the form of
warrants, bank checks, bank drafts, certified checks, money orders or
cash.
B. This amendment shall be attached to said contract and shall be effective on
the day of , 19—.
Witness our hands the
BOARD OF ADMINISTRATION
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
BY
Carl J. Blechinger, Executive Officer
ved
as to form:
is
Besemer,
�I
�J
1 Office, Date
day of _x.19_.
CITY COUNCIL ci
OF THE
CITY OF SANTA ANA
BY U
Presiding OffilWer
Com®
Attest: py
Clerk a
PERS CON -702
(2015.5 C.C.P.)
STATE. OF CALIFORNIA,
ss.
County of Orange,
I am a citizen of the United States and a resident of
the County aforesaid; I am over the age of eighteen
years, and not a party to or interested in the above
entitled matter. I am the principal clerk of the
printer of The Register, a newspaper of general cir-
culation, published in the City of Santa Ana, County
of Orange, and which newspaper has been adjudged
a newspaper of general circulation by the Superior
Court of the County of Orange, State of California,
under the date of November 29, 1905, Case Num.
bar A21046; that the notice of which the annexed
Is a printed copy, has been published in each reg.
ular and entire issue of said newspaper and not in
any supplement thereof on the following dates, to -
wit:
July 8, 1981
I certify (or declare) under penalty of perjury that
the foregoing is true and correct.
Executed at Santa Ana, California.
19--81---
This spas, , for the County Clerk's Filing Stamp
7733-44
Legal Notice
Proof of Publication of
Paste Clipping of
Notice
SECURELY
In This Space
Britt N. Lindgren—Legals v
DSP 165 PROOF OF PUBLICATION
4
CITY OF SANTA ANA ORDINANCES
The' City Council. Of the City of Santa .'Ana will C".o`l.sA.dejE '
adoption of the following entitled ordinances at its meeting
to be held on Ju.'
ORDINANCE NO. NS -1588: AN ORDINANCE OF THE CITY 017
SANTA ANA AUTHORIZING AN AMENDMENT TO THE CONTRACT
BETWEEN THE CITY COUNCIL OF THE CITY OF SANTA ANA
AND THE BOARD OF ADMINISTRATION OF THE: CALIFORNIA
PUBLIC EMPLOYEES RETIREMENTSYSTEM.
Forfurther information, a complete copy of the ordinance is
on file i51 the office of the Clergy of the Council, City
Hall, 20 Civic Center Plaza, telephone 834-4906.
,fUANTGE C GUY r'
CLDItR Off' THECO[]NC .r.
Publish. . �9f31-----
Ai f idavit i 3 Invoices