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HomeMy WebLinkAboutCM - CAVAZOS, DAVID - 2ND AMEND - 2015CITY OF SANTA ANA SECOND AMENDMENT TO THE CITY MANAGER EMPLOYMENT AGREEMENT 1. PARTIES AND DATE This Second Amendment to the City Manager Employment Agreement ( "Second Amendment ") is made and entered into as of January 20, 2015 by and between David Cavazos (hereinafter referred to as the "City Manager" or the "Employee ") and the City of Santa Ana (hereinafter referred to as "City "). City and City Manager /Employee are sometimes referred to individually as "Party" and collectively as "Parties" throughout this Second Amendment. 2. RECITALS 21 Agreement and First Amendment. On August 5, 2013, City and Employee entered Into an employment agreement entitled "City Manager Employment Agreement" (the "Agreement'), setting forth the terms and conditions for City Manager services to be provided by the Employee to the City. On September 2, 2014 City and Employee entered in a First Amendment the Agreement a copy of both the Agreement and First Amendment are attached hereto as Exhibit A to this Second Amendment. 2.2 Second Amendment. City and Employee now desire to amend the Agreement for the second time in order to update and provide for certain executive level benefits related to a health savings plan and a 401(A) plan. 3. TERMS 3.1 General Benefits. Section 2.2.1 (General Benefits) of the Agreement is hereby amended by Including a new Exhibit A to the Agreement. A copy of which Is attached and incorporated herein by reference as Exhibit B to this Second Amendment. 3.2 Remainina Provisions. Except as amended by the First Amendment or - «, +. • :. (.♦ � + { ! ♦ ! a.+ tom' `.. {.'t i • / { t ♦ i this Second Amendment. 3.3 Adeouate Consideration. The Parties hereto irrevocably stipulate and agree that they have reach received adequate and independent consideration for the performance of the obligations they have undertaken pursuant to this Second Amendment. A -20115-0 118 3.4 _C�unteroarts This Second Amendment may be executed in duplicate originals, each of which is deemed to be an original, but when ta shall constitute but one and the same instrument. ken together IN WITNESS WHEREOF, the Parties have executed this Second Amendment to the City Manager Employment Agreement as of the day of January 20, 2015. Approved as to Form MW r Son1 • Ca ho, B Krieger C' Ariomey BY David Cav os ATTEST Maria D. Huizar, Clerk of th ouncil N Exhibit A- Copies of Original Employment Agreement and First Amendment G %4t C R Th �30oi,ib AntepDkeAJ 7 A *3013.118 CITY Ol,' SANTA ANA CITY MANAGER EMPLOYMENT AGREEMENT This City Manager Employment Agreement ( "Agreement") is entered into as of the 5th day of August, 2013 (the "Effective Date% between the City of Santa Ana (hereinafter referred to as the "City ") and David Cavazos (hereinafter referred to as the "City Manager" or the "Employee "). City and City Manager/Employee are sometimes referred to in this Agreement as "Parry" and collectively as "Parties." RECITALS WHEREAS, the City Council of the City desires to appoint and employ Employee as City Manager pursuant to the Charter of the City of Santa Ana ( "City Charter "), and WHEREAS, the Employee desires to accept the appointment as the City Manager of the City, and WHEREAS, it Is the desire of the City Council and Employee to set forth certain benefl% establish certain conditions of employment and to set certain working conditions of the City Manager in an Employment Agreement, NOW, THEREFORE, the above named parties hereby mutually agree and promise as follows: 1. Term/Automatic Annual Renewal. This Agreement shall be deemed effective for a three (3) year term beginning on October 21, 2013 and terminating on October 70, 2016, unless terminated earlier in accordance with Section 9 hereof. This initial three (3) year term will, pursuant to the provisions below, automatically extend from year to year unless City Council takes action to prevent the automatic extension, in the event the City Council does not want this Agreement to automatically extend, it will provide written nonce to City Manager that the Agreement will not be extended and consequently will terminate as of the end of the current term. If action is not taken by City Counoil within three (3) months before the expiration of the initial term of this Agreement on October 20, 2016, this Agreement shall on July 20, 2016, automatically extend for one (1) year from October 21, 2016 until October 20, 2017. For each succeeding year that the City Council does not take action to extend or terminate this Agreement by three (3) months before the then current end of the Agreement, the Agreement shall automatically extend for an additional year. For example, if action is not taken by the City Council to extend or terminate this Agreement by Jtdy 20, 2017, the Agreement shall on that date automatically extend for one (1) year from October 21, 2017, to October 20, 2018, and if the 45435.01 W01 711 SD43,4 City Council doesn't take action to extend or terminate this Agreement by July 20, 2018, it will automatically extend for one (1) year from October2l, 2018 to October 20, 2019, 2. Compensation. 2.1 Salary (a) Annual Salary City agrees to pay City Manager, and City Manager agrees to accept from City, as compensation for services rendered by City Manager pursuant to this Agreement, an annual base salary, commencing on the Effective Date, in the amount of Three hundred Fifteen Thousand Dollars ($313,000.00, hereinafter "Annual Base Salary "), payable in installment payments in the same manner and at the some times as salaries of other executive managers of the City are paid. The term "Annual Base Salary"' as used in this Agreement shall also include any such adjustments approved by the City Council other than payments not eligible to be added to the City Manager's Annual Base Salary pursuant to time terms of any applicable salary resolution of City. The tern "Monthly Base Salary" as used in this Agreement shall mean a sum of money equal to one- twelf':h (I A 2) of City Manager's Annual Base Salary as defmned herein. (b) Deferred Compensation. City Manager shall receive as additional compensation added to his base salary and deducted there$om pursuant to Government Code Section 53214, deferred compensation in the maximum annual amountpemiltted pursuant to Section 457 of the Internal Revenue Code at the time of exeoution of this Agreement, said amount consisting o£ the maximum Standard contribution mid the Age 50+ contribution. (o) Performance Bonus Each fiscal year, commencing with the fiscal year that starts on July 1, 2014, the City Council may grant to City Manager a performance bonus. Whether or not to grant a bonus and the amount of any such bonus shall be in the sole discretion of the City Council. The decision by the City Council regarding the performance bonus shall be made for each fiscal year at the time the City Council is providing the performance evaluation of City Manager required by paragraph 3 of this Agreement. It is the understanding and intent of the City and City .Manager that performance bonuses are not reportable to the California State Public Employees Retirement System ( Ca1PERS "), and are not to be included in the calculation of City Manager's retirement allowance. Performance bonuses arc not added to the annual base salary. 45635,01000\7118043.4 2.2 Benefits 2.2.1 Cxanoral Benefits In addition, and except as oti.arwiso specified herein, City Manager shall receive Oil such other benefits that are applicable to executive managers of the City as of the Effective Date of this Agreement, including but not limited to medical insurance, dental insurance, long term disability insurance, life insurance, si'ok leave, holidays, vacation, bereavement and family illness leave, physical examinations, particlpation in retiromont system and participation in the City's retiree medical program in the same matarat as other City executive managers as described in Exhibit "A" attached hereto, 22.2 Initial Sick Leave Bank Upon omployment with City, City Manager shall be provided with an Initial sick leave bank containing 80 hours of usable sick leave, This initial sick leave bank of 80 hours shall be for use by the City Manager under the applicable City policies and State and Federal laws only, and shall not ba subject to any type of cash•out provision at termination as provided under City policies pertaining to the regularly accumulated employee sick leave balances. 213 Initial Vacation Allowance Upon employment with City, City Manager shall be awarded 80 hours of vacation leave. City Manager shall accumulate additional regular and management vacation hours in the same manna, as other City executive managers. 2.2.4 Longevity Vacation City Manager shall accumulate Longevity Vacation at the maximum accrual rate for an employee having completed 20 years of service with the City. 2.2,5 CalPERS Membership As a "new employee" under CalPERS, City Manager will be enrolled in the 2% at age 62 benefit formula and shall be responsible for paying the corresponding employee contribution per Ca(PER3 requirements as they exist today or as may be amended by the legislature, As of the effective date of this Agreement the applicable contribution rate is 6.75% on the first $136,440,00 of brio salary. 2.2,6 Relocation Benefit City Manager shall be provided reimbursement for the actual costs required to relocate to California, Le., moving expenses, not to exceed the sum of $7,500.00. Said reimbursement may include the costs of up to 2 visits to Orange County prior to moving to locate suitable housing, 06310100 M8043.4 2.2.7 Housing Allowance It is understood that City Manager intends to reside in the City of Santa Ana during his employment as City Manager, and that initially he will require a temporary residence while he is purchasing a permanent residence in the City and selling his existing residence in the City of Phoenix. Further, it is understood that the City Council desires that City Manager reside within the City of Santa Ana and believes that such residence would be of benefit to the City and enhance City Manager's performance as aty Manager, and therefore, the City will pay City Manager the following allowances and assistance in order to offset the costs and expenses he will incur in establishing a temporary residence in the City, selling his existing Phoenix residence, acquiring a permanent residence in the City and moving both his temporary and permanent roaldences; (a) Tomporary Housing Assistance City Manager shall be provided with reimbursement for the actual costs of temporary housing while City Manager seeks and obtains permanent Santa Aura housing in a sum not to exceed $3,000 per month and for a period not to exceed 12 months from the date of this Agreement. Prior to the 12 month maximum duration, said Temporary Housing Assistance shall cease upon City Manager closing escrow on the purchase of a local residence or the execution of a lease on a non - temporary residence. (b) Housing Allowance Upon the termination of the Temporary Housing Assistance referenced above, City Manager shall be provided with a housing allowance in the sum of $2,000.00 per month for the duration of the balance of the 3 year term of this Agreement. Said housing allowance shall be contingent Von City Manager residing within the City. 3, Performance Evaluation. The Mayor and the City Council are responsible for setting performance goals on an annual basis in consultation with the City Manager. The City Council shall review slid discuss City Manager's performance in or around July of each year commencing in 2014. However, Employee acknowledges and accepts the fact that the City Council as Employer has the right to schedule an evaluation session at any time in acocrdanoe with the notice and all other requirements of the Brown Act. 4. Bonds. City shall bear the fWl cost of any fidelity or other bonds required of City Manager under any law or ordinance. 4695,aroaa7118043.4 4 'i 5. Transportation and General Business Expenses. 5.1 Vehicle Provision City shall provide City Manager with a vehicle, as wall as fuel, maintenance and liability insuranoo for said vehicle, for City Manager's use in commuting in the performance of his employment duties and for incidental personal use. 5.2 General Business Expenses (d) City agrees to budget and pay for professional dues and subscriptions for City Manager necessary for his continuations and participation in national, regional, state and local boards, task - forces, conferences and meetings, associations and organizations desirable for City Manager's continued participation, professional growth and advancement, and for the benefit of the City. (b) City agrees to budget and pay for travel and subsistence expenses of city Manager for professional and official travel, board and tosk•fcrce meetings, and occasions to adequately continue the professional development of City Manager and to pursue necessary official functions for City. (c) City shalt provide City Manager with the necessary technology tools, including and not limited to computer, software, cell phone and such other technologies as required by City Manager to perform his duties and to maintain communications. 6. Abuse of Office or Position. Pursuant to Government Code Sections 53243, 53243.1 and 53243.2, which became effective on January 1, 2012, if City Manager is convicted of a crime involving an abuse Of his office or position, all of the following shall apply: (1) if Manager is provided with administrative leave pay ponding an investigation, City Manager shall be required to fully reimburse City such amounts paid; (2) if City pays for the criminal legal defense of City Manager (which would be in its sole discretion, as it is generally not obligated to pay for a orbalnal defense), City Manager shall be required to fully reimburse City such amounts paid; and (3) if this Agreement is terminated, any Severance Pay and Severance Benefits related to the termination that City Manager may MONO from City shall be fully reimbursed to City or void If not yet paid to City Manager. For purposes of tills Section, abuse of office or position means either: (I) an abuse of public authority, including waste, fraud, and violation of tho law under color of authority; or (2) a crime against public justice, including, but not limited to, a crime described In Title 7 (commencing with Section 92) of Part I ofthe Penal Code, 7. Notices. Any notice required or permitted by this Agreement shall be in writing and shall be personally served upon the other Party, or sent by United States Postal Service, postage prepaid and addressed to the appropriate Party as follows: 45635.a1006V1{$043,4 5 If to City: City Attorney City of SantaAna 20 Civic CenterPlaza Santa Ana, CA 92702 If to City Manager: David Cavazos City Manager City of SantaAna 20 Civic Center plaza Santa Ana, CA 92702 Notice shall be domed given as of the date of personal service or upon the date of deposit in the course oftransmission with the United States postal Service, S. Duties, Acceptance of Appointment, Hours of Work, Regional Liaison. 8.1 Duties City hereby agrees to employ Employee as City Manager of the City of Septa Ana to perform the functions and duties specified in the City Chaster of the City of Santa Ana, and to Perform such other legally permissible duties and functions as the City Council may firm time to time assign. 82 Acceptance ofAppointmont Employee hereby accepts the appointment as City Manager of the City of Santa Ana subject to all terms and conditions $0 forth in this Agreement, 8.3 Flours of Work It is recognized that City Manager devotes a great deal of time outside the normal City H411 ofEoe -hours schedule, and to that end, he shall be allowed to establish his work schedule, taking into consideration that he is responsible for the supervision of employees and has responsibilities to serve all departments of the City, 9. Termination. 911 At -Will Employee Employee shall serve at the will and pleasure of the City COnlneil. Nothing in this Agreement shall prevent, limit or Otherwise interfcro with the right of the City Council to suspend fkom duty, remove from ofSco or otherwise terminate the services of City Manager at any time, at the sole discretion of die City Council, as provided in the City Charter, This Agreemontmaybe terminated as follows, 0635.01 00017118043.4 9.2 Termination - Council Vote As required in Section 500 of the City Chatter, the City Council may remove the City Manager by motion adopted by the affrrmativo votes of at least two- thirds (213) of the members of the City Council. At least thirty (30) days before such removal shall become effective, the City Council shall by resolution adopted by the affirmative votes of at least hvo- thirds (213) of the members of the City Council state the reasons in writing for the removal of the City Manager, 9.3 Termination • Change in Form Of Government If any of the goveming policies pertaining to the role, power, duties, authority, or responsibilities of City Manager are amended to substantially change City's form of government, either by action of the City Council, a duly passed initiative measure or state legislation, City Managerahall have the right to terminate the Agreement, 9.4 Reduction of Salary or Benefits If the City Council reduces the Annual Base Salary or any other financial benefit of the City Manager in a percentage that is greater than the average reduction of base salary for all executive managers of the City, such action shall constitute a termination of this Agreement, 9,5 Resignation City Manager may voluntarily resign his position as City Manager, after giving City at least sixty (60) days written notice prior to the effective date of such resignation, unless such notice is walved in whole or part by the City Council. In the event the City Manager resigns from his employment with City, the City Manager shall not be entitled to any Severance Pay, 9.6 Severance In the event this Agreement is terminated pursuant to any one of Sections 9.2, 9.3 or 9.4 of this Agreement, the City Manager shall receive a severance payment, in a lump sum, equal to twelve (12) months of City Manager's then monthly Base Salary ( "Severance Pay ") in accordance with the provisions of this Agreement. A Severance Pay payment shall be his sole remedy for termination under sections 9 °2, 9.9 or 94 of this Agreement. The Severance Pay shall be paid after the City Manager executes a waiver and release agtectnont prepared by the City Attorney in a form substantially similar to that one sot forth as 11xhibit "B" to this Agreement. Notwithstanding any provision of this Agreement to the contrary, City may terminate City Manager's employment for cause at any time end without prior notice, and if City Manager is terminated for cause, he shalt not be entitled to payment of severance compensation or any other compensation or damages, "Cause" shall include the following reasons, (a) Conviction of a crime, whether misdemeanor or a felony, involving moral turpitude. 45e35.01anm711800.4 q i For purposes of this paragraph, aplea of 11010 rantendere shall also be considered a conviction. (b) City Manager is determined by a court of competent jurisdiction or the State of California Fair Political Practices Commission to have knowingly and unlev&ly participated in a governmental decision in which he had a conflict of interest as do fined in Government Cade Section 87100, at seq. or Government Code Section 1090 er seq. (c) Failure to follow a lawful directive of the Council after written notice of said failure is provided to City Manager approved by five (5) or more affirmative notes of its seven (7) members. (d) Continued abuse of drugs or alcohol that materially affeots the performance of the City Manager's duties. (e) Repeated and protracted anexcased absences from the City Manager's office and duties. 10. General Provisions; 10.1 This writing constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior oral or written representations or written agreements on the subject matter hereof, which may have been entered into between the parties. No modification or revision to this Agreement shall be of any force or effect, unless the same is in writing and executed by the Parties hereto. 10.2 Each Party agrees and acknowledges that no representations, inducements, proases, Or agreements, oral or otherwise, have been made by any Party, or anyone acting on behalf of any Party, which are not embodied herein and that any agreement, statement, or promise not contained in this Agreement shall not be valid or binding an either Party. 103 if any provision, or portion thereof, eontafncd in the Agreement is held unconstitutional, invalid or unenforceable, the remainder of this Agreement, or portion thereof, shall be deemed severable, shalt not be affected and shall retrain in full force and effect. 10.4 This Agreement shalt be governed by and construed in accordance with the law of the State of California, 10.5 This Agreement shall be construed as a whole, according to its fair meaning, and not in favor or against any Party. By way of example and not in limitation, this Agreement shall not be construed in favor of the Party receiving a bereft nor against the Party responsible for any particular language in this Agreement. 10.6 Employee acknowledges that he has had an opportunity to consult legal counsel in regard to this Agreement, that he has read and understands this Agreement, that he is fully aware of Its legal effect, and that he has entered into it freely and voluntarily and based on his own judgment and not on any representations or promises other than those contained in this 45635- QT000171 I&D45.4 Agreement. 11. Intentionally Left Blank 12. Communications in the Evgnt of Termination 12,1 In the event the City terminates Employee for any reason or no reason, the City and Employee agree that no member of the City Council or City employees acting on behalf of the City shall make any written, oral, or electronic statement to any member of the public, the press, or any City employee concerning the Employee's termination except in the form of a Joint press release or statement, which is mutually agreeable to the City and the Employee. The joint press release or statement shall not contain am text or information that is disparaging to either Party. Either Party .tray verbally repeat the substance of the Joint press release or statement in response to any inquiry. 13. indemnification 13J City shall defend, hold harmless and indemnify City Manager against any tort, prOfeWOnal liability claim or demand or other legal action, whether groundless or Otherwise, arising out Of any alleged act or omission occurring in the performance of City Manager's duties or resulting from the exercise of his judgment or discretion in connection with the performance of his duties, City shall not unreasonably refuse to provide for legal representation at City's expense. Legal representation, provided by City for City Manager, shall extend until a final determination of the legal action including any and all losses, damages, judgments, interests, settlements, fines, court costs, and the reasonable costs and expenses of legal proceedings, including appeals, and including attorneys' fees, and expert witness fees and all other trial and appellate costs, and other liabilities incurred, imposed upon, or suffered by such City Manager in connection with or resulting ftm any claim, action, suit, or proceeding, actual or threatened, arising out of or in connection witb the performance of City Manager's duties. 13,2 City agrees to pay all reasonable litigation expenses of City Manager throughout pendency of any City-related litigation to which City Manager is a patty, witless or advisor to the City. Such expense payments shall continue beyond City Manager's employment with the City as long as litigation is pending, Post -cmployment, City agrees to pay City Manager for reasonable consulting fees, travel expenses and other costs, when City Manager serves as a witness, advisor or consultant to City regarding pending litigation. [SIONATUMS ON FOLLOW1NGPAGE] 4SW3 0100M119043.4 IN WITNESS WHE OF, the Parties have excotbd this City Employment Agreement as of the �`'• day of August, 2013, EMPLOYEE1CffY MANAGER Da vl Cavazos CTf/Y OF SANTA ANA Mlgpf 9. Pulido Mayas ATTEST: Maria D. Huizar —� Clerk of the Council 45635.0100711 8043.4 10 Approved as to Form= So i , Carvalho, Hest Best & Krieger C Attorney Exhibit "B" YVATW =BASE BA I, the undorslgnod, do horeby aoknowledge and attest that I have read and understood section 9.6 of my Enaplopt0nt AgrovMzit with trio City of SaIlm Ana and hereby agree that by ampting tweivs (12) months 8evaraioe Pay In -the amount of $ (12 x current monthly base salaip3, I agree to waive all dglat,s to further alaims, remedies, or legal acttbn against the City, its ofPi'ders and• maployoes, In exchange for mooipt of the Soveranoo Payment, I and my representatives, lrehre, auccessora, and asslgm do hereby completely release and fomver dischargo the City of Santa Ann mid ita mated entities and theta present and 'former ofilcors, directors, council members, agonts, btaaployecs, attorneys, gild suoaossOrs (001100 *817, "Relamsd X V30s') from all 01aims, dghts,.demands, notions, obligations, i'iablllt rs, atu[ eausbs of aodori of every kind and ohmacter, known of urakrtiown, mature or turrnatmod,.which I may have now or in the future arising from ,any act or dralssloa or ponditian oeourringon or prior to the data: thus waiver Is-aigared whether based on- tort, contraot (or€ ,m or implied}, or my federal, state, or legal law, twitute, or regulation (aaile0dvalq, the 1IR4100 Claims °). Released Claims shall also huludo, but not be limned to, elalius fbr wages or othor compensatim dim, sovorattcn pay, bonuses, sick leave, vaQatigtr pay, life dr homith fnsuranae, or any oth ®rfeirrge banairt, ' 13mploymz'isnawiugly and voiuntariiy waives any mid all rights or bone'fats that he may now have, or in the future may have, under the terms of Section 154.2 of the California Civil Code, *Wohprovides as follows: A <}BIMAL RELEASE DOES NOT EXTENT? TO CLAIMS WMCH THE CREDITOR APES NOT KNOW OR SUSPECT TO EM6T IN M OR HER FAVOR AT TIM TIME OF EXECUTOG TI3E RELEASE, WMal M KNOWN 15Y HDA OR I-MR MUST HAVFb 'MATERIALLV AFPECTED HIS S8TTLEMHNT.WITH THE DEBTOR: By initialing below, the Employes aoknowiedyes that he or she has road and uudmrstands fl* waiver and voluatarily gild knowingly is waiving his eight m4sr Flootlon j542 to pursue unlenown orunaecipatbd olaims, rights, demands, a4ons, obligations, Iiabt'lities andoauses of action of any Wild. initials of Ecugloye 45635.0NOOVI L8043A 11 Bsaxployae shell hat ft any oiaim, sue or initiate, agadnst any Reisased Party, any 00abplianw revised, aGdM or proceeding, ar partieipate in the same, laulividualiy or as a MOmbw of a olds, tindor any contraet (express ar implied), or euy federal, state, or lacer 1aW, statute, or regsalationperiaitting in fay mea = to the ltsleasod Clelms, Approved and A By: M5,010671A00.4 12 nl �yV� • � i ci u lY ..w ?r A-2014.200 CITY OF SANTA ANA ]FMST AxMNIMM TO TEM CITY MANAGER EMLOYMIST A+GMIkIWr This P1rst Amendment to the City Manager Employment Agreement (" Agreement") is entered into as of the 2'� day of September, 2014 (the "Efteotive Date,% between the City of Santa Ana (herelrtdter roferred to as the "Ciiy') and David Cavazos (heroinsfiat referred to as the "City Manager" or the "Bmpioyae" . City and Chy ivTanagor /[3mpInyee are sometimes referred to in this Agreement as °'Party' and collectively as "PartieaP' W ORRAS, on August 91h, 2013 the City Connell of the City appointed and employed .Employee as City Manager of the City pursuant to the Charter of the City of Santa Ana C City Charter), aaad %IMEAS, the Paellas set forth the terms and conditions of said City Maaagar's etrtploNtsot in an agreement entitled the City of Santa. Ana City Manager Employment Agreement ( °Agreement'°] effective that same date, and WSiE17.SAS, the Partial desire to amend Certain provisiona of the Agreement as Be frnth herein. W'L-i BFi'OO, in consideration oftbc oovotmts contained In said Agreement and subj act to all the terms and conditions of said Agreement, the 'Parties hereto apee as follows; Sedtion 1, T.MWAUTOMArC ANNUAL RENEWAL, shall he deleted in its entirety and replaced with Mefoilowiag: 1, Terns /Automade Annual Reamal, Tlils Agroement shall be deemed off%&e for a three ($) year form beginning on Ootobor 21, 2014 and terminating on October 20, 2017, unless terminated earlier in accordance with Seogoo 9 hemoS This these (3) year term will, pursuant to tine provisions below, automatically oxtond from year to year unless City OQMQ9 tastes action, to prevent the autoinatlo extension, in the event tho City Council does tot want this Agreement to automatically extend, it will provide written notice to City Manager that the Agreement will not be extended and consequently will terminate as of the end of the current terra. If action is not taken by City Council within ihree (3) moths before the expirations of the torm of this Agreement on Ootobw 20, 2017, Ails Agreement shall on 7Wy 20, 2011, amomatloally oxtwd for one (1) year from October 21, 2017 tuntl Ootobor 20, 2018, For 09999.x00=4064 a1 each succeeding year that the City Councll does nqt take godon to extend or terminate this Agreement by dose (3) months before the then attrtent end of the Agreement, the Agreement ahali autotnatioally extend for an additional year, For example, if action is not taken by the City shall to extend or terminate this Agreement by July 20, 2018, the Agreement shall on that into automatically extend for axis (1) year from October 21, 2018, to October 20, 2015, and irthe City Council doesn't take action to extend, er terminate this Agreement by July 20, 2019, it will automatloally extend for one (1) year from October 21, 2015 to October 20, 2020, Section 217, HOUSING ALLOWANCE, shall be, delafiod in its entirety and replaced with the following; 217 '1•lousingA,llowcoo It is understood that City Manager intends to zeside in the City of Santa Ana during Us employment as City Managet, and that initially he will require a temporary residence while he is purchasing a permanent residence in tbo City, ;Further, it is understood that the City Council desires that City Manager reside within the City of Santa'Ara and believes that such residence would be of benefit to the City'and enhance City Maoaget's pertbrmance as City Manager, and therefore, the City will pay City Manager the Following allowanoes and asimnoe: Soedon 217(b� HOUS1NO ALLOWANCE, shall be deleted in its ernfrety and replaced with the followiogt (b)Housing Allowance (Temporary) Upon the termination of the Temporary Housing Assistance pfovided for in Section 22.7 (a), City shall pay City Manager a ineue4ag tdlgwance in the ammmt of $2,000,00 per' month up ttndl October 16, 2016, Said housing allowance shall be oontingout upon City Manager residing within the City. 1~Mcept as bereinabove amended, all terms and conditions of said Agreement shall remain in M force and eff'eot, M WM888 %' Elt&OF, the Parties b,,tve executed this First Amendment to the City Manager Employment Agreement as of the 2nd day of September, 2014, EVlYLdJY' MANAGED &7' �� David Cavazos d 5539 +1.000024y40GM1i9.1 ATTEST; Clerk of the Counai] 55394, 00002174 U G 419.1 Approved as to Folln; Sonial Carvelho m E JO*tw5t ka A ity Attomey Exhibit B- Descrlptlon of General Benefits provided to Executives The attached draft resolution is to be considered at the January 20, 2015 City Council meeting, Agenda Item 55A, RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA MODIFYING, REESTABLISHING AND DELINEATING THE BASIC COMPENSATION AND BENEFIT PLAN FOR CLASSES OF EMPLOYMENT DESIGNATED AS UNREPRESENTED EXECUTIVE MANAGEMENT (EM) AND RESCINDING RESOLUTION NO. 91 -066. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS: Section 1: The City Council hereby finds, determines and declares as follows: A. Section 1004, Article X of the City Charter of the City of Santa Ana requires the City Manager to prepare, install and maintain a position classification and pay plan subject to civil service rules and regulations and the approval of the City Council. B. On July 1, 1991, the City Council passed and adopted Resolution No. 91 -066, re- establishing the Basic Classification and Compensation Plan for classifications of employment designated as unrepresented Executive Management (EM) and Middle Management (MM). C. The City Council has amended Resolution No. 91 -066 on numerous occasions since its adoption. D. Pursuant to Resolution No. 81 -075, the Employee Relations Resolution of the City of Santa Ana, and applicable State law, the City of Santa Ana certified the Santa Ana Management Association (SAMA) on September 25, 2002, as the majority representative of the Middle Management and Administrative Management Representation Unit. Hence, the City has recognized SAMA as the certified majority representative of the full time employees in said Unit. E. In an effort to clarify the compensation of unrepresentative Executive Management (EM) employees, and delete obsolete language related to unrepresented Middle Management (MM) employees, the City Attorney recommends reestablishing and delineating the Basic Classification and Compensation Plan for classifications of employment designated as unrepresented Executive Management (EM) through this resolution, by separate resolution reestablishing and delineating the Basic Classification and Compensation Plan for all represented full -time employees in the City, including represented Middle Management (MM) employees, and all represented and non - represented part-time employees, and rescinding Resolution No. 91 -066. F. The City Manager recommends an increase to the Tuition Reimbursement Program to provide the highest amount that is available to other represented employees. G. The City Manager recommends establishing and delineating a Retirement Health Savings Account for unrepresented Executive Management (EM) employees and contributing to said account the highest amount that is available to other represented management employees. H. The City Manager recommends establishing and delineating a 401(a) Retirement Savings Account for unrepresented Executive Management (EM) employees to participate in, at his or her sole discretion. It is now desired to rescind Council Resolution No. 91 -066 and reestablish and affect the aforementioned changes. Section 2: Unrepresented Executive Management (EM) Basic Compensation and Benefit Plan. The City Council hereby reestablishes the unrepresented Executive Management (EM) Basic Compensation and Benefit Plan effective January 1, 2015, to read as follows: Unrepresented Executive Management (EM) Basic Compensation and Benefit Plan Effective January 1, 2015. Section 1. Executive Management (EM) Classifications and Compensation Plan. A. Unrepresented Executive Management (EM) Employee Classifications Assistant City Manager (EM) Deputy City Manager (EM) Police Chief (EM) Executive Director of Community Development (EM) Executive Director of Finance and Management Services (EM) Executive Director of Parks, Recreation and Community Services (EM) Executive Director of Personnel Services (EM) Executive Director of Planning and Building Safety (EM) Executive Director of Public Works (EM) Special Assistant to the City Manager (EM) B. Schedule of Salaries. A schedule of salaries showing salary rate ranges for classifications of employment designated as unrepresented Executive Management (EM), is attached hereto and made a part hereof as though set forth in full herein. The schedule for unrepresented Executive Management (EM) classifications and effective dates is listed as follows: Salary Schedule Unrepresented EM Classifications No Effective Date Assistant City Manager (EM) EM -39 01/01/2015 Deputy City Manager (EM) EM -41 01/01/2015 WISED Police Chief (EM) EM -47 01/01/2015 Executive Director of Community Development (EM) EM -3433 01/01/2015 Executive Director of Finance and Management Services (EM) EM -3237 01/01/2015 Executive Director of Parks, Recreation and Community Services (EM) EM -3437 01/0112015 Executive Director of Personnel Services (EM) EM -3833 01/01/2015 Executive Director of Planning and Building Safety (EM) EM -42 01/01/2015 Executive Director of Public Works (EM) EM -3538 01/01/2015 Special Assistant to the City Manager (EM) EM -37 01/01/2015 The unrepresented Executive Management (EM) salary schedule contains numerous salary rate ranges, each range comprised of fifteen (15) separate rates of pay shown in monthly amounts. The rate ranges are identified by a two -digit number preceded by the capital letters "EM" for Executive Management. The separate rates of pay or steps within each salary rate range are identified by the numbers 1" through "15" inclusive, with Step 1" being the lowest or minimum rate of the range, Step "8" the middle or midpoint rate of the range, and Step "15" being the highest or maximum rate. Terminal Classifications. The capitalized letter "T" shown within parenthesis [i.e., (T)] next to a classification title signifies a position classification that has been designated as "terminal" by formal City Council action and, as such, will be deleted from this classification and compensation plan for unrepresented Executive Management (EM) classifications of employment when vacated by its last remaining incumbent. No new appointment may be made to a classification that has been designated as terminal. Section 2. Special Pay Additives and Additional Compensation Provisions. Bilingual Skill Pay. Qualified employees who are assigned to positions involving the regular and frequent use of bilingual skill in both English and either Spanish, Vietnamese or any other language designated by the City Manager will be paid in the highest amount as available to represented management employees. Incumbents of positions where bilingual proficiency is essential to the performance of duties and responsibilities of a critical and /or emergency nature, or of positions where bilingual public contact is a major, essential or integral element of the work being performed, will be paid in the highest amount as available to represented management employees. Section 3. Administration and Applicability of the Compensation Plan A. Unless specified otherwise herein, unrepresented Executive Management (EM) employees will be subject to the same changes in compensation plan provisions, including but not limited to, sick leave maximum accrual; bereavement leave; holidays; longevity vacation cash out; health and dental insurance; access to participation in the City's Vision Plan; retirement; Retirement Health Savings Plan; and work week schedule, as provided in the highest amount as available to represented management employees on or after January 1, 2015. B. Compensation Plan Implementation. Upon implementation of the basic salary schedule set forth in Sub - section I.B. of this Resolution, a current incumbent of an Executive Management (EM) classification listed herein above will be placed at the monthly rate in the assigned salary rate range which matches the incumbent's assigned base monthly salary rate on the day preceding the effective date of this Resolution. C. Hiring Pay Policy. A newly hired Executive Management (EM) employee will be compensated at a monthly rate within the lower third of the salary range (Steps 1 through 5) for his /her job classification as authorized by the appointing authority. When economic conditions, unusual employment conditions, or exceptional qualifications of a candidate for employment indicates a higher rate would be in the City's best interest, the City Manager may authorize compensating the new employee within the middle third of the salary range (Steps 6 through 10) but the higher starting salary will generally not be above Step 8. D. Rates of Pay for Temporary and Part -Time Work. When an employee is hired in an Executive Management (EM) classification on a temporary basis, which is defined as employment with an anticipated duration of less than six (6) months, or an employee is hired in an Executive Management (EM) classification on a part -time basis, which is defined as employment of forty (40) hours or less per semi - monthly pay period, the employee will be paid at a rate per hour for actual time spent in the duties of his or her employment. Rate per hour will be computed to the nearest whole cent by dividing the classification's standard monthly rate of compensation by 173.33. A computation resulting in exactly one -half (1/2) cent will fix the rate at the next higher whole cent. E. Service. The word "service" as used in this Resolution will be deemed to mean continuous, full -time service in the classification in which the employee is being considered for salary advancement, service in the higher classification or service in a classification allocated to the same salary rate range and having generally similar duties and requirements. Employees hired after the first (1S) working day of the month will not be credited with "time in service" for that month when determining the length of service required for salary step advancement. A lapse of service by an Executive Management (EM) employee for a period of time longer than ten (10) calendar days by reason of resignation, quit, or discharge, will serve to eliminate the accumulated length of service time of such employee for the purpose of this Resolution. F. Appointment or Promotion of Current Employee. An employee who is appointed or promoted to an Executive Management (EM) classification from a represented management or non - management classification of the City service will be placed at a salary rate in the Executive Management (EM) salary rate range which provides a minimum of a five percent (5 %) pay increase. G. Reduction in Pay. An Executive Management (EM) employee may receive a reduction in salary on the basis of unsatisfactory work performance, conduct or other reasons at the discretion of the City Manager. H. Temporary Upgrade to an Executive Management (EM) Classification. Regular employees of the City who are incumbents of classes of employment not included in this Resolution and who are temporarily upgraded to an Executive Management (EM) classification will receive a five percent (5 %) increase or the minimum rate of the Executive Management (EM) salary range, whichever is higher, in accordance with current upgrade provisions. I. Reallocation of Salary Rate Ranges. When an employee is in an Executive Management (EM) classification which is reallocated from the current salary rate range to a different salary rate range, the employee will retain the same salary step he or she held prior to the reallocation. The employee will retain credit for length of service in such salary step towards advancement to the next higher salary step. J. Y- Rating. In special circumstances the City Manager may approve compensating an employee in excess of the salary range of the classification to which he or she is assigned by "freezing" the employee's salary at the current rate. In such cases, incumbents will not receive step increases or current and future general "across - the- board" salary adjustments scheduled for other classes until the salary level is equal to or greater than the "frozen" salary for the assigned classification. K. Z- Rating. A Z -Rate is a special salary rate established by the City Manager which allows an employee who has been reclassified to a classification at a lower salary rate range to be paid at a rate of pay higher than that assigned to his or her reclassified position title for a specified transition time period. Section 4. Health and Welfare Benefits. The following optional insurance benefits available to Executive Management (EM) employees are provided through a cafeteria plan adopted in accordance with the provisions of Internal Revenue Code § 125. The City will contribute to the cafeteria plan in the highest amount as available to represented management employees. Since the City contracts with CalPERS for medical insurance, the amount described above will include the CalPERS statutory minimum paid by the City. A. Medical insurance. Eligible Executive Management (EM) employees may select any of the medical insurance plan options offered by CalPERS. B. Dental insurance. Eligible Executive Management (EM) employees will have the ability to select either an HMO or PPO dental insurance plan. C. Vision insurance. Eligible Executive Management (EM) employees will have the ability to select vision insurance coverage through the City's insurance provider. D. Cash -in -Lieu of Benefits. Executive Management (EM) employees will be eligible to receive cash (subject to taxation as wages) through the cafeteria plan if they either opt -out of receiving one of the optional benefits provided through the plan or if they choose optional benefits that do not cost as much as the maximum dollar amount they receive through the plan. E. Employee Contributions for Benefits. If an Executive Management (EM) employee chooses optional benefits whose aggregate premium cost exceeds the maximum City Contributions to the Cafeteria Plan, the City will automatically deduct the excess premium amount on a pre -tax basis from the employee's regular paycheck. F. Disability Insurance, The City will pay one hundred percent (100 %) of the premium cost for a long -term disability insurance plan under the policy it maintains on behalf of its employees in order to provide Executive Management (EM) employees a monthly benefit of sixty -six and two- thirds percent (66 2/3) of base monthly salary (insured payroll), less offsets contained in the existing plan, to a maximum monthly benefit of $5,000. G. Life Insurance and Accidental Death & Personal Loss (AD &PL). The City will pay one hundred percent (100 %) of the premium cost for term life and AD &PL insurance coverage under the policy it maintains on behalf of its employees in order to provide Executive Management (EM) employees with life and AD &PL insurance coverage in an amount equal to three times the employee's annual rate of salary to a maximum of $300,000 provided Executive Management (EM) employees can provide evidence of insurability for coverage above $150,000 if so required by the terms and conditions of said term life and AD &PL insurance policy. In the event an Executive Management (EM) employee is determined to be ineligible for said insurance coverage, the City will attempt to provide as much coverage as may be obtained at a reasonable cost without having to provide evidence of insurability Section 5. Leave Accruals and Cash -Out Provisions. A. Paid Holiday Time Off. Executive Management (EM) employees are not required to appear for work, except in emergencies, and will receive payment at his or her current base salary rate for the following twelve (12) holidays during each year: January 1St; third Monday in January; third Monday in February; last Monday in May; July 4t , first Monday in September; November 11th; Thanksgiving Day and the day immediately following (Friday); Christmas Day; the last working day before Christmas Day (unless Christmas Day falls on Thursday, in which instance the day following Christmas Day will be observed) and one (1) floating holiday. Any holiday which falls on Sunday will be observed on the following Monday and any holiday which falls on a Saturday will be observed on the Friday preceding the holiday. B. Vacation Time Off. Executive Management (EM) employees will be granted regular and longevity paid vacation leave on the same basis as provided to represented employees of the City, with the exception that such affected employees will be granted: 1. Regular vacation with pay at the annual rate of fifteen (15) working days for each of his or her first and second completed year of service. 2. An additional five (5) working days per year over the regular and longevity vacation accruals applicable to represented employees of the City. Affected Executive Management (EM) employees must take at least five (5) consecutive days of vacation leave each year. C. Longevity Vacation Credits for Newly -Hired Executive Management (EM) Employees. The City Manager is authorized to grant to a person newly hired by the City to a position designated as Executive Management (EM), longevity vacation credits in the form of years of service to the City up to a maximum of 20 years. The credits will be counted as completed years of service with the City for the purpose of calculating longevity vacation accrual only. The longevity vacation credits will be added to the years of service actually completed with the City of Santa Ana by the employee to establish total years of service for the purpose of calculating longevity vacation. D. Longevity and Vacation Pay Option. Once per fiscal year, Executive Management (EM) employees will be given the option to receive cash compensation, computed on a straight time basis, in lieu of up to five (5) working days of earned, unused vacation benefits set forth in Section B. E. Sick Leave Credits for New Hires. The City Manager is authorized to grant a newly appointed Executive Management (EM) employee sick leave credits up to an amount equal to any earned but unused sick leave credits available to such appointee at the time of his or her separation from his or her most recent previous employer. F. Payment for Unused Sick Leave. Executive Management (EM) employees will be granted payment for unused sick leave on the same basis as provided to Santa Ana Management Association (SAMA) represented employees of the City. G. Paid or unpaid Administrative Leave Policy. The City Manager is authorized to grant, at his or her discretion, paid or unpaid leave for Executive Management (EM) employees. Section 6. Retirement Plan Contributions. A. The terms of the existing contract between the City and California Public Employees' Retirement System (CaIPERS) governing the City retirement benefits of Executive Management (EM) employees covered by this Resolution are incorporated by reference herein. The City will make contributions to CaIPERS in accordance with its contract with CaIPERS for employees covered by said contract as amended. B. 2.7% at 55 Service Retirement Benefit for Classic Miscellaneous Members The City agrees to provide Executive Management (EM) employees covered by this Resolution, and who are defined as Classic Miscellaneous Members under the California Public Employees' Pension Reform Act (PEPRA) of 2013 (AB340), with the 2.7% at 55 Service Retirement benefit. C. Payment of 2.7% at 55 Service Retirement Benefit Classic Miscellaneous Executive Management (EM) employees covered by this Resolution will contribute eight percent (8 %) of CaIPERS reportable compensation toward the employer cost of the 2.7% at 55 enhanced retirement formula. This payment will be implemented as cost - sharing pursuant to Government Code Section 20516(f). Pre - Taxable Benefit. To the extent permitted by CaIPERS and Internal Revenue Service regulations, this eight percent (8 %) employee contribution will be implemented through payroll deductions on a pre -tax basis. D. 2.0% at 62 Service Retirement Benefit for New Miscellaneous Members. The City agrees to provide Executive Management (EM) employees covered by this Resolution who were appointed to their classification on or after January 1, 2013, and who are defined as new members under the California Public Employees' Pension Reform Act (PEPRA) of 2013 (AB340), with the 2.0% at 62 Service Retirement benefit. E. Payment of 2.0% at 62 Service Retirement Benefit. Executive Management (EM) employees defined in 6.D. (above) will contribute at least 50% of normal cost of the 2.0% at 62 retirement benefit. Pre - Taxable Benefit. To the extent permitted by CalPERS and Internal Revenue Service regulations, the City will make the above employee deductions pre -tax contributions. F. 3% at 50 Service Retirement Benefit for Classic Safety Members. The City agrees to provide Executive Management (EM) employees covered by this Resolution, and who are defined as Classic Safety Members under the California Public Employees' Pension Reform Act (PEPRA) of 2013 (AB340), with the 3% at 50 Service Retirement benefit. G. Payment of 3.0% at 50 Service Retirement Benefit. Classic Safety Executive Management (EM) employees covered by this Resolution will contribute nine percent (9 %) of CalPERS reportable compensation toward the employer cost of the 3.0% at 50 enhanced retirement formula. This payment will be implemented as cost - sharing pursuant to Government Code Section 20516(f). Pre - Taxable Benefit. To the extent permitted by CalPERS and Internal Revenue Service regulations, this nine percent (9 %) employee contribution will be implemented through payroll deduction on a pre -tax basis. H. 2.7% na. 57 Retirement Benefit for New Safety Members. The City agrees to provide Executive Management (EM) employees covered by this Resolution who were appointed to their classification on or after January 1, 2013, and who are defined as new members under the California Public Employees' Pension Reform Act (PEPRA) of 2013 (AB340), with the 2.7% @ 57 Service Retirement benefit. I. Payment of 2.7% at 57 Service Retirement Benefit. Executive Management (EM) employees defined in 6.H. (above) will contribute at least 50% of normal cost of the 2.7% at 57 retirement benefit. Pre - Taxable Benefit. To the extent permitted by CalPERS and Internal Revenue Service regulations, the City will make the above employee deductions pre -tax contributions. J. Final Compensation for Pension Calculation. Final compensation for Classic Safety and Classic Miscellaneous Members will be based on the highest annual average compensation earnable during the 12 consecutive months immediately preceding the effective date of his or her retirement, or some other 12 consecutive month period designated by the member. Final compensation for Safety and Miscellaneous Members who are defined as New Members under PEPRA will be based on the highest annual average compensation earnable during the 36 consecutive months immediately preceding the effective date of his or her retirement, or some other 36 consecutive month period designated by the member. K. Military Service Credit as Public Service. An Executive Management (EM) employee covered by this Resolution will be permitted to purchase up to four (4) years of service credit for any continuous active military or merchant marine service prior to employment. The cost to purchase this service credit is subject to CalPERS Regulations and calculated using a present value method, L. Deferred Retirement for Classic Safety and Classic Miscellaneous Members as defined in Section B and F (above). The City will continue to make payments to CalPERS on behalf of each eligible affected employee in an amount necessary to pay one hundred percent (100 %) of his or her individual retirement contribution which is equal to eight percent (8 %) of reportable compensation for Classic Miscellaneous Members and nine percent (9 %) for Classic Safety Members. Such payments will be credited to the individual employee's CalPERS account. Such payments are not an increase in base salary and no salary rate range applicable to any of the employees covered by this Resolution will 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 previously received a ruling from the Internal Revenue Service confirming that such payments are deferred compensation and not ordinary income. In the event that the City receives a new 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 will discontinue and in place thereof the reportable compensation of each Classic Miscellaneous Member eligible for the 2.7% at 55 Benefits Formula will be increased by eight percent (8 %) and each Classic Safety Member eligible for the 3% at 50 Benefits Formula will be increased by nine percent (9 %). For the purpose of reporting an employee's compensation to CaIPERS, the City will include these payments as if they were a part of the employee's reportable compensation. Section 7. Tuition Reimbursement. Executive Management (EM) employees are eligible to participate in the Training and Education Assistance Program provided for all regular, full -time employees of the City. Reimbursement will be based on the cost of tuition, required enrollment/registration fees, miscellaneous fees (health, parking, student union fees, etc.) and all required texts, eBooks and related material for each course. Maximum tuition reimbursement will be paid in the highest amount as available to other represented employees. Section 8. Medical Retirement Subsidy Plan. A. The City's current annual contribution towards the Medical Retirement Subsidy Plan for Executive Management (EM) employees covered under this Resolution is 1.75% of the base salary, which is based on the first payroll period in October and deposited no later than October 31 sc of each year. B. The plan will be administered by the City, at no cost to Executive Management (EM) employees pursuant to the written directives of Executive Management (EM) employees. The funds contributed by the City will be maintained in such a manner as to ensure that the funds are invested in a reasonably secure plan that bears a reasonable rate of interest/growth given current financial markets. For purposes of this Resolution, investments made pursuant to the then current Statement of Investment Policy for the City of Santa Ana, will be deemed to meet the requirements of this section. This program is for medical insurance premium reduction only. C. Effective November 28, 2011, the City adopted a resolution authorizing implementation of the "Vantage Care" Retirement Health Savings Plan (RHS), which designated ICMA -RC as the administrator of the plan. 1. The City agrees to amend the current contract with ICMA -RC to allow unrepresented Executive Management (EM) employees to participate in the Retiree Health Savings Plan upon approval of the majority of Executive Management (EM) employees. 2. Upon establishment of the RHS and adoption of the RHS plan by Executive Management (EM) employees, and upon instructions from Executive Management (EM) employees the City's annual contribution of 1.75% deposited in the Medical Retirement Subsidy Plan will cease. Concurrently with said cessation, the City will increase the base pay of each Executive Management (EM) employee by 1.25% with said amount being deposited into employees' individual RHS accounts each pay period. This 1.25% increase in base is in -lieu of the Annual City Contribution of 1.75% paid to the Medical Retirement Subsidy fund in October each year. 3. If said RHS Plan is established after the annual payment of 1.75% into the existing Medical Retirement Subsidy plan has been made, the salary adjustment and deposit into the RHS of the 1.25% described in paragraph 8.C.2. above will be effective July 1, 2015. 4. Upon approval to participate in the RHS, Executive Management (EM) employees will determine how the existing Medical Retirement Subsidy Plan funds will be distributed among its membership and, if applicable, its retired members. Executive Management (EM) employees will dissolve the existing Medical Retirement Subsidy plan by June 30, 2016, unless said deadline has been extended by mutual agreement of Executive Management (EM) employees and the City. Section 9. Auto Allowance. With the exception of the Police Chief who receives a City vehicle, the City will contribute five hundred dollars ($500) per month to each Executive Management (EM) employee to offset reasonable and necessary expenses for the operation, maintenance and insuring of an automobile. In lieu of receiving five hundred dollars ($500) per month, the employee may request and be provided with an optional vehicle. This provision is in accordance with and as specified in Section 2 -300, Division 1, Article IV, Santa Ana Municipal Code. Section 10, Deferred Compensation. The City has established and maintains a deferred compensation plan pursuant to the provisions of Section 457(b) of the Internal Revenue Code. Executive Management (EM) employees covered under this resolution, at his or her sole discretion, may defer to have deposited into the City's 457(b) plan a portion of his or her compensation up to the maximum amount permitted by law. The City is desirous of establishing a 401(a) deferred compensation plan. As permissible by law the City will establish a 401(a) deferred compensation plan at a future date. Executive Management (EM) employees covered under this resolution, at his or her sole discretion, may defer to have deposited into said 401(a) plan upon its establishment a portion of his or her compensation up to the maximum amount permitted by law. All contributions into the 457(b) and 401(a) plan are voluntary employee contributions and will meet the requirements of the Internal Revenue Code. Section 11. Unrepresented Executive Management (EM) Performance -Based Evaluation System. The provision of the unrepresented Executive Management (EM) performance -based evaluation system are as follows: 11.1 Purpose. The basic purpose of the performance -based evaluation system is to help attract, retain and motivate highly competent Executive Managers and to provide them with a strong incentive to excel. 11.2 Specific Compensation Determination. A. The City Manager is hereby given the authority to set the individual compensation, to make adjustments thereto and to make appointments at any salary within the established range for all executive positions except the City Manager, the City Attorney, and the Clerk of the Council, which will be made by the City Council. B. The City Manager will establish performance criteria and appraisal guidelines to be utilized in setting individual compensation for Executive Management (EM) employees. C. After the salary of an employee has been first established and fixed under this plan, salary advancement through the remaining steps of the 15 -step salary rate range will be based on the results of an annual performance evaluation. 11.3 Evaluation System Components. The evaluation system will be comprised of the following components: A. Annual Objectives. The system will include a list of outcome - based, measurable objectives to be achieved which have been mutually agreed upon between the appropriate appointing authority and each individual manager subject to his or her authority. A relative weight will be assigned to each objective listed with a minimum weight of 10% and all must total 100 %. B. Managerial Behaviors. In addition to his or her performance in achieving agreed upon objectives, each Executive Manager will also be evaluated for his or her managerial behavior performance, including such behavior as communication (oral or written), analysis and problem solving, decision - making and judgment, planning and organization, management control, leadership, interpersonal relations, time - management, technical knowledge, handling of stress, etc. 11.4 Performance Evaluation Guidelines. A. The City Manager will annually evaluate the performance of each of his or her Executive Management (EM) employees annually to determine their individual eligibility for a performance increase and how much, if any, increase will be given. Such annual performance evaluation will occur once a year and will cover the twelve month period preceding that date. Additionally, at least one informal mid -year progress review will be held between the City Manager and each of his or her Executive Management (EM) employees. B. Performance Ratings. Each manager's performance in relation to his or her agreed upon annual objectives and managerial behaviors will be evaluated according to the following performance rating scale: Point Ratinq Performance Levels 3 Significantly Exceeds Expectations: Consistently exceeds all objectives requirements and expectations by a wide margin. 2 Exceeds Expectations: Consistently meets all objectives and requirements and exceeds several. 1 Meets Expectations: Meets objectives and requirements. 0 Below Expectations: Fails to meet some objectives and requirements. 1 Unacceptable: Performance is significantly below the minimum required. 11.5 Performance -Based Salary Adjustments. Each Executive Management (EM) employee may be eligible to receive an annual performance- based, in -range salary increase and /or one -time monetary payment based on a percentage of current annual rate of base salary, or be subject to a performance -based salary reduction, in accordance with the following: A. For overall performance rated as "Significantly Exceeds Expectations," either step increases or one -time monetary payment or a combination of step increases and one -time monetary payment not to exceed seven and one -half percent (7.5 %) in toto. B. For overall performance rated as "Exceeds Expectations," either step increases or one -time monetary payment or a combination of a step increase and one- time monetary payment not to exceed five percent (5 %) in toto. C. For overall performance rated as "Meets Expectations," a one -time monetary payment in an amount up to but not to exceed two and one -half percent (2.5 %) of current annual rate of base salary or advancement of one step (2.5 %) within the salary rate range. D. For overall performance rated as 'Below Expectations," no performance salary increase or monetary incentive payment. E. For overall performance rated as "Unacceptable," no performance salary increase or monetary incentive payment. Additionally, any Executive Management (EM) employee who has received such a rating and who is being paid at a step higher than the minimum rate of the salary rate range, may be reduced by one or more steps at the discretion of the City Manager. F. Application of Guidelines. 1. If an Executive Manager who is recommended for a performance increase is at the maximum of his or her salary rate range, then the entire performance increase must be awarded the equivalent amount in a one -time monetary incentive payment. 2. Any one -time monetary incentive payment granted under this plan is not an increase in base salary and no salary rate range applicable to any management employee covered by this Resolution will be changed or deemed to have been changed by reason of such payment. 3. The City Manager will be responsible for the development and administration of detailed administrative procedures and guidelines for the consistent and effective application of the unrepresented Executive Management (EM) performance -based evaluation system. Such procedures and guidelines will define how performance objectives, measures and standards are developed; when and how performance reviews are to be carried out; how performance component ratings and composite ratings will be scored; and how performance salary increase and monetary incentive payment options are to be exercised. Section 12. Miscellaneous Provisions A. Catastrophic Leave Donation. Executive Management (EM) employees will be eligible to donate and receive catastrophic leave donations as provided to all other represented employees. C. Electronic Device Stipend, Executive Management (EM) employees who use their own personal electronic devices for City business in lieu of receiving a City owned device will be eligible to receive a stipend at a level matching that received by SAMA employees. B. Other Unrepresented Executive Management (EM) Employee Rights and Privileges. Each employee in a classification of employment designated in Sub - section 1.A. of this Resolution as unrepresented Executive Management (EM) will continue to enjoy the same rights and privileges to which they were entitled under Resolution 91- 066 unless otherwise amended, altered or eliminated herein. Section 3: That Resolution No. 91 -066, as amended, is hereby rescinded in its entirety. Section 4: This Resolution is operative from and after January 1, 2015. ADOPTED this 20t' day of January, 2015. APPROVED AS TO FORM: Sonia R. Carvalho City Attorney By: Sonia Carvalho AYES: NOES: ABSTAIN: NOT PRESENT: Councilmembers Councilmembers Councilmembers Councilmembers Miguel A. Pulido Mayor CERTIFICATE OF ATTESTATION AND ORIGINALITY I, MARIA D. HUIZAR, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2015 -_ to be the original resolution adopted by the City Council of the City of Santa Ana on 20, 2015. Date: Clerk of the Council City of Santa Ana