Agenda Report
Fullerton City Council
MEETING DATE: MARCH 19, 2024
TO: CITY COUNCIL
SUBMITTED BY: EDDIE MANFRO, DIRECTOR OF HUMAN RESOURCES PREPARED BY: CHRISTINE PILAPIL, HUMAN RESOURCES MANAGER I SUBJECT: EMPLOYER-PAID MEMBER CONTRIBUTIONS TO THE CALIFORNIA EMPLOYEES’ RETIREMENT SYSTEM CHANGES
SUMMARY
Proposed resolutions to reduce and eliminate the Employer Paid Member Contribution (EPMC) to the California Public Employees’ Retirement System (CalPERS) for Classic Miscellaneous and Classic Safety members.
PROPOSED MOTION
Adopt the following resolutions:
RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE FULLERTON MUNICIPAL EMPLOYEE FEDERATION RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE FULLERTON MANAGEMENT ASSOCIATION RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE CONFIDENTIAL / NON-REPRESENTED UNIT RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE FULLERTON POLICE MANAGEMENT ASSOCIATION RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE FULLERTON POLICE OFFICERS ASSOCIATION - SAFETY RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE FULLERTON POLICE OFFICERS ASSOCIATION - DISPATCHER RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE FULLERTON FIRE MANAGEMENT ASSOCIATION RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE FULLERTON FIREFIGHTERS’ ASSOCIATION RESOLUTION NO. 2024-XXX – A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FULLERTON, CALIFORNIA, PAYING AND REPORTING EMPLOYER PAID MEMBER CONTRIBUTION VALUE FOR THE EXECUTIVE UNIT
ALTERNATIVE OPTIONS
Approve the Proposed Motion
Do not adopt the resolutions and provide direction to staff Other options brought by City Council.
STAFF RECOMMENDATION
Staff recommends the Proposed Motion.
CITY MANAGER REMARKS
The City Manager recommends adoption of the attached Resolutions.
PRIORITY POLICY STATEMENT
This item matches the following Priority Policy Statement:
Fiscal and Organizational Stability.
FISCAL IMPACT
The City reports Employer Paid Member Contribution (EPMC) as additional earnings for retirement benefits calculations. Staff would factor negotiated changes to eliminate and reduce EPMC will into annual budgets.
BACKGROUND AND DISCUSSION
California Public Employees’ Retirement Law allows employers to pay the employee normal cost (“member contribution”) and report the value to CalPERS as additional compensation for employees not excluded under the law. The City implemented this benefit, known as EPMC, for regular employees in all classifications through the collective bargaining process in the early 1990s when city employers commonly paid the employee share, often in lieu of providing salary increases to employees. The Public Employees’ Pension Reform Act (PEPRA), which took effect in January 2013, no longer allows employers to pay the employee contribution for new members.
City Council approved Memoranda of Agreement with the Fullerton Municipal Employees Federation (FMEF), Fullerton Management Association (FMA), Confidential / Non-Represented, Fullerton Police Management (FPMA), Fullerton Police Officers – Safety (FPOA–PSU), Fullerton Police Officers – Dispatchers (FPOA–D), Fullerton Fire Management (FFMA) and Fullerton Firefighters’ (FFA) in 2023 to increase the employee share of CalPERS contributions over a three-year period, eventually eliminating EPMC for Classic Miscellaneous members. EPMC for Classic Safety members would reduce but will not be fully eliminated during the term of the current MOAs. The chart below shows the step-down percentages for each bargaining unit. Current EPMC Percentage7/1/20247/1/20257/1/20261/1/2027FMEF
7.00%
5.50%
4.00%
2.00%
0.00%
Management
7.00%
6.000%
5.00%
2.50%
0.00%
Confidential
6.00%
4.042%
2.021%
0.00%
Police Management
9.00%
3.00%
Police Officers
9.00%
3.00%
Police Dispatch
7.00%
1.00%
Fire Management
7.00 3.00%
Firefighters
9.00 3.00%
CalPERS requires City Council adopt and approve the attached resolutions before the City can implement the reporting change.
The Executive Unit EPMC reduced to 0% in 2022. CalPERS requests City Council approve a new resolution with the new format reducing EPMC for that group as well.
Attachments:
Attachment 1 – Draft Resolution Fullerton Municipal Employees Federation Unit Attachment 2 – Draft Resolution Fullerton Management Association Unit Attachment 3 – Draft Resolution Confidential / Non-Represented Unit Attachment 4 – Draft Resolution Fullerton Police Management Association Unit Attachment 5 – Draft Resolution Fullerton Police Officers – Safety Unit Attachment 6 – Draft Resolution Fullerton Police Officer – Dispatch Unit Attachment 7 – Draft Resolution Fullerton Fire Management Unit Attachment 8 – Draft Resolution Fullerton Firefighters Unit Attachment 9 – Draft Resolution Executive Unit
cc: City Manager Eric J. Levitt
CalPERS Employer Paid Member Contribution
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