HomeMy WebLinkAbout11 Calpers Agenda Item # I I
Public Utility District
ACTION
To: Board of Directors
From: Nancy Waters
Date: July 21, 2010
Subject: Consideration of Employee-Funded Amendment with CaIPERS
1. WHY THIS MATTER IS BEFORE THE BOARD
Only the Board of Directors can approve a resolution.
2. HISTORY
The District has been contracted with the California Public Employees Retirement
System (CaIPERS) since August, 2004. The original contract with CaIPERS provides
a retirement formula for all District employees of 2% @ 60.
The bargaining unit for unionized employees inquired whether the District would
consider an enhanced formula (2.7% @ 55) and offered to discuss employees' paying
for the change of the increased costs.
The Board authorized the General Manager to meet and confer with the bargaining
unit regarding a possible employee-funded change. The District asked CaIPERS to
perform an actuarial valuation to determine the costs of the request. The total rate
increase is 8.908%.
3. NEW INFORMATION
The District and the Union met on three occasions to discuss this issue. The
bargaining 'unit considered the employee costs and through an election of their
members, agreed by majority of their desire to proceed with the contract amendment.
The District and the Union reached a tentative agreement outlining the the terms for
paying the costs of the amendment.
The employee costs for amendment to the contract were also presented to the
unrepresented employees; they also voted to proceed.
The terms of the tentative agreement discussed with employees include:
Employees will pay the entire 8.908% cost of the contract amendment
There will be no additional cost to the District
Future increases (or decreases) for this increased benefit will be paid on a pro-
rata basis by the employees
• When the Side Fund Liability (unfunded liability) is paid off (in approximately 12
years), the employee's rate will be reduced
0 If approved, the amendment will have a January 1, 2011 effective date.
CalPERS requires that clearly defined procedures be followed for contract
amendments.
• First, a Resolution of Intention must be approved by the Board (Attachment A)
and received by CaIPERS by August 1, 2010 (this action).
• Government Code Section 7507 requires that the actuarial impact upon future
annual costs be presented by an actuary in a public meeting. This step of the
process will be scheduled for a future board meeting.
• An employee secret ballot election must be held. This election must follow
adoption of the Resolution of Intention and precede the final documents.
• Adoption of the final resolution
4. FISCAL IMPACT
There is no additional cost to the District associated with this action. All new costs wil
be borne by the employees.
5. RECOMMENDATION
Adopt a Resolution of Intention to approve an Amendment to the Contract between
the Board of Administration of California Public Employees' Retirement System and
the Board of Directors of the Truckee Donner Public Utility District to implement the
2.7% @ 55 retirement formula for Miscellaneous Employees.
Mary Cha a Michael D. Holley
Administrative Services Manager General Manager
RESOLUTION OF INTENTION
TO APPROVE AN AMENDMENT TO CONTRACT
BETWEEN THE
BOARD OF ADMINISTRATION
CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM
AND THE
BOARD OF DIRECTORS
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
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 procedures to amend this contract is the adoption
by the governing 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 21354.5 (2.7% @ 55 Supplemental
formula) for local miscellaneous members.
NOW, THEREFORE, BE IT RESOLVED that the governing body of the above agency
does hereby give notice of intention to approve an amendment to the
contract between said public agency 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.
By:
Presiding Officer
Title
Date adopted and approved
(Amendment)
CON-362(Rev.4196)