HomeMy WebLinkAbout32-98 r. 11, i • 11)
RESOLUTION #32-98
RESOLUTION OF INTENTION
TO APPROVE AN AMENDMENT TO CONTRACT
BETWEEN THE
BOARD OF ADMINISTRATION
OF THE
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
AND THE
TOWN COUNCIL
OF THE
TOWN OF LOS ALTOS HILLS
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 2% @ 55 Full and Modified 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
Presiding Officer
Title Mayor
May 20, 1998
Date adopted and approved
(Amendment)
CON-302(Rev.4/96)
• • •
EXHIBIT A
AMENDMENT TO CONTRACT
BETWEEN THE
BOARD OF ADMINISTRATION
OF THE
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
AND THE
TOWN COUNCIL
OF THE
TOWN OF LOS ALTOS HILLS
The Board of Administration, Public Employees' Retirement System, hereinafter referred to as
Board, and the governing body of above public agency, hereinafter referred to as Public Agency,
having entered into a contract effective July 1, 1967, and witnessed June 16, 1967, and as
amended effective June 1, 1976 which provides for participation of Public Agency in said
System, Board and Public Agency hereby agree as follows:
A. Paragraphs 1 through 9 are hereby stricken from said contract as executed effective June
1, 1976, 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 meaning as defined therein unless otherwise
specifically provided. "Normal retirement age" shall mean age 55 for local
miscellaneous members.
2. Public Agency shall participate in the Public Employees' Retirement System from
and after July 1, 1967 making its employees as hereinafter provided, members of
Law
allprovisions of the Public Employees' Retirement
said System subject to p Yees
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 those,
which by express provisions thereof, apply only on the election of a contracting
agency. .
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. other than local safety
Employeesmembers (herein referred to as local
miscellaneous members).
•
•
4. 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:
a. FIREMEN AND POLICEMEN;
b. PERSONS COMPENSATED ON AN HOURLY BASIS; AND
c. ELECTIVE OFFICIALS.
5. The percentage of final compensation to be provided for local miscellaneous
members for each year of credited prior and current service shall be determined in
accordance with Section 21354 of said Retirement Law, subject to the reduction
provided therein for service prior to March 31, 1976, termination of Social
Security, for members whose service has been included in Federal Social Security
(2% at age 55 Full and Modified).
6. Public Agency elected and elects to be subject to the following optional
provisions:
a. Sections 21624 and 21626 (Post-Retirement Survivor Allowance).
b. Section 21571 (Basic Level of 1959 Survivor Benefits).
c. Section 21024 (Military Service Credit as Public Service), Statutes of
1974.
7. Public Agency, in accordance with Government Code Section 20790, ceased to be
an "employer" for purposes of Section 20834 effective on June 1, 1976.
Accumulated contributions of Public Agency shall be fixed and determined as
provided in Government Code Section 20834, and accumulated contributions
thereafter shall be held by the Board as provided in Government Code Section
20834.
•
8. Public Agency shall contribute to said Retirement System the contributions
determined by actuarial valuations of prior and future service liability with respect
to local miscellaneous members of said Retirement System.
9. Public Agency shall also contribute to said Retirement System as follows:
a. A reasonable amount, as fixed by the Board, payable in one installment
within 60 days of date of contract 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.
• • •
b. A reasonable amount, as fixed by the Board, payable in one installment as
the occasions arise, to cover the costs of special valuations on account of
employees of Public Agency, and costs of the periodic investigation and
bylaw.valuations required
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 fifteen 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 correct amount of contributions is paid for any
period, proper adjustment shall be made in connection with subsequent
remittances. Adjustments on account of errors in contributions required of any
employee may be made by direct payments between the employee and the Board.
B. This amendment shall be effective on the 1st day of July , 1998 .
BOARD OF ADMINISTRATION TOWN COUNCIL
PUBLIC EMPLOYEES' RETIREMENT SYSTEM OF THE
TOWN OF LOS ALTOS HILLS
BY
A/ R. BY CX 11„6/1-(4 )
KENNETH W. MARZION, C F PRESIDING OG,$---
ACTUARIAL &EMPLOYER SERVICES DIVISION C
PUBLIC EMPLOYEES' RETIREMENT SYSTEM
June 18, 1998
Witness Date
Attest:
C-4E.‘J
Clerk
AMENDMENT
PERS-CON-702A(Rev.8\96)
• • I •
CONTRACT AMENDMENT COST ANALYSIS-VALUATION BASIS: JUNE 30, 1996
MISCELLANEOUS PLAN FOR THE TOWN OF LOS ALTOS HILLS
EMPLOYER NUMBER 690
Benefit Description: Section 21354, 2% @ 55 Formula
As announced in Circular Letter No. 200-154, dated December 5, 1996, effective July 1, 1997, CaIPERS
policy is to implement rate changes due to plan amendments immediately, on the effective date of the
change in plan benefits for effective dates on or after July 1, 1997.
The same Circular Letter informed you that CaIPERS has also revised the method in which the change in
the unfunded liability due to plan amendments is amortized. The new policy provides that the change in
unfunded liability due to the plan amendment will be amortized over a period of 20 years from the
effective date of the amendment. The pre-amendment unfunded liability continues to be amortized
separately. See your latest actuarial report for details. Only the change in unfunded liability due to the
plan amendment is amortized over 20 years.
If your agency intends to adopt this amendment, the amendment must be effective on or before July 1,
1998,or be resubmitted for costing.
Shown in the exhibit below is the change in your 1998/99 rate due to the plan amendment assuming an
effective date of July 1, 1998. If the amendment effective date is after July 1, 1998, the cost shown
below is no longer valid and a new cost calculation will be required. If the amendment effective date is
before July 1, 1998 the change due to plan amendment(shown below) for each rate component(Normal
Cost and Unfunded Cost) will be added to your current rate components. Your new rate for the
remainder of 97/98 will be the sum of the rate components (with the total not being less than zero). The
post-amendment rate shown below will be your rate beginning on July 1, 1998.
Amendment Change Due to
Effective Rate Component Pre-Amendment Rate Plan Amendment Post-Amendment Rate
Date Effective
Immediately
Fiscal 97/98 Accrued Liability $ 1,661,904 $ 167,014 $ 1,828,918
Assets 1,614,697 0 1,614,697
Unfunded Liability $ 47,207 $ 167,014 $ 214,221
Normal Cost 6.608% 1.870% 8.478%
Unfunded Cost (0.307)% 1.726% 1.419%
Retirement Total* 6.301% 3.596% 9.897%
1959 Survivor** 0.000% 0.000% 0.000%
* Rate totals cannot be less than zero.
** The 1959 Survivor program cost is in addition to the Retirement program cost.
05/06/98:3:51 PM
-" 11111 4110
The increase in employer costs for your retirement plan due to the amendment has two basic
components: Normal Cost and the Unfunded Cost.
Although the Normal Cost component may change from year to year depending on that
year's active membership, the change in normal cost shown in the previous table is
expected to be a permanent increase for as long as the contract is in effect.
Unfunded Cost is a temporary increase to the employer contribution rate based upon the
change in unfunded liability. This increase in rate ceases at the end of the 20 year
amortization period. The unfunded accrued liability existing before the amendment is
amortized separately.
If your agency is requesting cost information for two or more benefit changes, the cost of adopting more
than one of these changes may not be obtained by adding the individual costs. Instead, a separate
valuation should be done to provide a cost analysis for the combination of benefit changes.
05/06/98:3:51 PM