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Searchable packet 12-04-12 Table of Contents Agenda2 Enact ordinance to amend contract with California Public Employees Retirement System (CalPERS) for a second tier, 2% at 60 retirement plan Staff Report5 A-Draft Ordinance7 B-CalPERS Amendment to Contract8 C-City Retirement System Tiers matrix14 1 AGENDA CUPERTINOCITYCOUNCIL~REGULARMEETING SUCCESSORTOTHEREDEVELOPMENTAGENCY~REGULARMEETING 10350TorreAvenue,CommunityHallCouncilChamber Tuesday,December4,2012 6:45PM CITYCOUNCILMEETING PLEDGEOFALLEGIANCE ROLLCALL CEREMONIALMATTERSANDPRESENTATIONS None POSTPONEMENTS None ORALCOMMUNICATIONS Thisportionofthemeetingisreservedforpersonswishingtoaddressthecouncilon anymatternotontheagenda.Speakersarelimitedtothree(3)minutes.Inmostcases, Statelawwillprohibitthecouncilfrommakinganydecisionswithrespecttoamatter notlistedontheagenda. CONSENTCALENDAR None SECONDREADINGOFORDINANCES None PUBLICHEARINGS KNone 2 Tuesday,December4,2012CupertinoCityCouncil SuccessortotheRedevelopmentAgency ORDINANCES AND ACTION ITEMS 1.Subject:EnactordinancetoamendcontractwithCaliforniaPublic$³¶²µ¿««¹ RetirementSystem(CalPERS)forasecondtier,2%at60retirementplan :ConductthereadingandenacturgencyOrdinanceNo.12 RecommendedAction 2100:AnOrdinanceoftheCityCounciloftheCityofCupertinoauthorizingan amendmenttothecontractbetweentheCityCounciloftheCityofCupertinoand theBoardofAdministrationoftheCaliforniaPublicEmployeesRetirementSystem anddeclaringtheurgencythereof StaffReport ADraftOrdinance BCalPERSAmendmenttoContract CCityRetirementSystemTiersmatrix Page:5 REPORTSBYCOUNCILANDSTAFF ELECTIONOFMAYORANDVICEMAYOR 2.Subject:CouncilmemberselectMayor 3.Subject:CouncilmemberselectViceMayor OATHSOFOFFICE :Mayortakesoathofoffice 4.Subject :ViceMayortakesoathofoffice 5.Subject COMMENTSBYNEWMAYOR 6.Subject:CommentsbynewMayorandpresentationofgifts COMMENTSBYCOUNCILMEMBERSANDPUBLIC 7.Subject:CommentsbyCouncilmembers 8.Subject:Membersoftheaudienceareinvitedtospeak 3 Tuesday,December4,2012CupertinoCityCouncil SuccessortotheRedevelopmentAgency RECEPTION 9.Subject:Thepublicisinvitedtoattendareceptioninthelobby ADJOURNMENT SUCCESSORTOTHEREDEVELOPMENTAGENCYMEETING Canceledforlackofbusiness. The City of Cupertino has adopted the provisions of Code of Civil Procedure §1094.6; litigation challenging a final decision of the City Council/Redevelopment Agency must be brought within 90 days after a decision is announced unless a shorter time is required by State or Federal law. Any interested person, including the applicant, prior to seeking judicial review of the city council’s decision with respect to quasi-judicial actions, must first file a petition for reconsideration with the city clerk within ten days after the council’s decision. Any petition so filed must comply with municipal ordinance code §2.08.096. In compliance with the Americans with Disabilities Act (ADA), the City of Cupertino will make reasonable efforts to accommodate persons with qualified disabilities.If you require special assistance, please contact the city clerk’s office at 408-777-3223 at least 48 hours in advance of the meeting. Any writings or documents provided to a majority of the Cupertino City Council after publication of the packet will be made available for public inspection in the City Clerk’s Office located at City Hall, 10300 Torre Avenue, during normal business hours and in Council packet archives linked from the agenda/minutes page on the Cupertino web site. 4 ADMINISTRATIVE SERVICES DEPARTMENT CITY HALL 10 10300 TORRE AVENUE CUPERTINO, CA 95014-3255 TELEPHONE: (408) 777-3227 www.cupertino.org CITYCOUNCILSTAFFREPORT Meeting:December4,2012 Subject EnactOrdinancetoamendtheContractwiththeCaliforniaPublic$³¶²µ¿««¹ RetirementSystem(CalPERS)forasecondtier,2%at60retirementplan. RecommendedAction EnactOrdinancetoapproveanAmendmenttotheContractbetweentheBoardof Administration,CaliforniaPublic$³¶²µ¿««¹RetirementSystemandtheCity. Description Thispastyear,theCitynegotiatedatwotierretirementplanwithitsemployeegroups. Thenewplan,effectiveforemployeeshired,fromanotherCalPERSagency,onorafter December29,2012,willprovidefora2%at60,threeyearaverage,retirementpackage withCalPERSversusourcurrentplanof2.7%at55,highestsingleyear. Discussion Thisbenefitchangeisduetothegrowingconcernthatcurrentretirementplansarenot sustainableandthatgovernmentswillneedtomodifytheirexistingplansinregardsto benefitpayoutandretirementage.Inaddition,theSantaClaraCountyGrandJuryhas stronglyrecommendedthatallcitiesadoptatwotierretirementplantoreducecurrent andfuturecosts. AssemblyBill340,adoptedthisFall,limitsnewmemberstoCalPERS,asofJanuary1, 2013,toaretirementpackagethatprovidesfora2%at62,threeyearaverage. However,theCityhasnegotiateda2%at60,threeyearaverageretirementbenefit whichwouldapplytoanynewCupertinoemployeewhohadpreviouslyservedwitha CalPERSparticipatingagencywithintheprevioussixmonthperiod.Thisintermediate tierwillhelptheCityremaincompetitiveinrecruitingfutureemploymentapplicants whohaveexperiencewithotherpublicagencieswhoarealsoCalPERSmembers,but closesthecurrent2.7%at55retirementbenefitforallnewemployeesgoingforwardas ofDecember29,2012.TheformalCalPERScontractneededfortheordinanceis attachedaswellasamatrixwhichdenotesourcurrent2.7%at55,thenegotiatedsecond tierof2.0%at60andthenewStatemandatedplan(thirdtier)of2.0%at62foryour information. 5 TheCouncilisrequiredtoenactthisasanUrgencyOrdinancesincetherewillnotbe enoughtimetomeetthenormal30dayrequirementforasecondreading.The ordinancesetsforththeeffectivedateofDecember29,2012,whichconformswith CalPERSguidelines. FiscalImpact Longtermsavingsfortransitioningtoatwotierretirementsystemareestimatedat approximately$35,000inFY2016/17andincreasetoroughly$325,000peryearinFY 2025/26. ________________________________ Preparedby:CarolA.Atwood,DirectorofAdministrativeServices ApprovedforSubmissionby:DavidBrandt,CityManager Attachments: StaffReport ADraftOrdinance BCaliforniaPublic$³¶²µ¿««¹RetirementSystemAmendmenttoContract CCityofCupertinoRetirementSystemTiersmatrix 6 ORDINANCENO.12______ ANORDINANCEOFTHECITYCOUNCILOFTHECITYOFCUPERTINO AUTHORIZINGANAMENDMENTTOTHECONTRACTBETWEENTHECITY COUNCILOFTHECITYOFCUPERTINOANDTHEBOARDOF ADMINISTRATIONOFTHECALIFORNIAPUBLIC$,/+.8$$2RETIREMENT SYSTEM ANDDECLARINGTHEURGENCYTHEREOF TheCityCounciloftheCityofCupertinodoesherebyordainthat: Section1 ThatanamendmenttothecontractbetweentheCityCounciloftheCityof CupertinoandtheBoardofAdministration,CaliforniaPublic$³¶²µ¿««¹Retirement Systemisherebyauthorized,acopyofsaidamendmentbeingattachedhereto,marked ExhibitA,andbysuchreferencemadeaparthereofasthoughhereinsetoutinfull. Section2. TheMayoroftheCityCouncilisherebyauthorized,empowered,anddirectedto executesaidamendmentforandonbehalfofsaidAgency. Section3. ThisUrgencyOrdinanceshalltakeeffectonDecember29,2012withthe effectivedateoftheamendmenttocontractonDecember30,2012. INTRODUCEDandENACTEDataregularmeetingoftheCityCouncil oftheCityofCupertinothis4dayofDecember,2012,bythefollowingvote: th MembersoftheCityCouncil Vote AYES: NOES: ABSENT: ABSTAIN: ATTEST:APPROVED: ___________________________________________________________ GraceSchmidt,CityClerkMarkSantoro,Mayor,CityofCupertino 7 8 9 10 11 12 13 Cl) w w FM Cl) Cl) FM z w 2 w FM w O z w LL a v 0 FM r U N j N oo.% ... 0 N O two a N LM L1' v N tA GC © �.1C Q M w LL W LLI LLJ o W �► 0 LLI J >- >- p W W C W V �o-� W J GL W � N Wav C) � +� W 06 N' 0 W LL a z LU W O 2 W 2 � W W W LLI Z L u O LLI _ W 0 CC co Lj V — �- > W LLI V W >. 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