City of Sacramento
City Council - 5PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2024-00342 1/9/2024 Discussion Item 24.
Approval of an Amendment to the City Manager Employment Agreement, Approval of an Increase to the Salary for the City Manager, and Authorizing the Mayor to Execute the City Manager Amended Employment Agreement
File ID: 2024-00342
Location: Citywide
Recommendation: Adopt a Resolution 1) approving an amended employment agreement for the City Manager; 2) approving a salary increase for the City Manager; and 3) authorizing the Mayor to execute an amended employment agreement for the City Manager.
Contact: Aaron Donato, Labor Relations Manager (916) 808-5816, [email protected], Department of Human Resources
Presenter: Aaron Donato, Labor Relations Manager (916) 808-5816, [email protected], Department of Human Resources Attachments:
1-Description/Analysis
2-Resolution
3-Exhibit A - City Manager Employment Agreement Amendment Description/Analysis
Issue Detail: At the July 25, 2023, meeting of the Personnel and Public Employees Committee meeting, the City Manager presented his annual report and was provided an initial performance evaluation by the Committee.
For Calendar Year 2023, the Unrepresented Resolution, modifying Article 5.1, has been amended to provide a cost-of-living adjustment (COLA) to the Appointed Officers, which includes the City Manager. The amount of the COLA shall be the average of the first-half and second-half changes in the Consumer Price Index (US Bureau of Labor Statistics, All Urban Consumers, US City Average, All Items) for the calendar year 2022, and rounded to the nearest one-tenth of one percent; provided, however, that the increases shall not be less than two percent (2%) nor more than five percent (5%).
Based on this CPI language, the City Manager will receive a five percent increase on his salary
File ID: 2024-00342 1/9/2024 Discussion Item 24.
anniversary date of February 11, 2023, and his new hourly rate will be $202.242466.
The specific amendments to the employment agreement are reflected in the amended employment agreement executed by the City Manager, which is included as Exhibit A to the Resolution.
Government Code 54953 requires that prior to taking final action, the legislative body must orally report a summary of the recommendation for final action on salaries, salary schedules, or compensation paid in the form of fringe benefits of a local agency executive during the open meeting in which the final action is to be taken. Local agency executives are defined in Government Code section 3511.1 (d) as “(d) Local agency executive means any person employed by a local agency who is not subject to the Meyers-Milias-Brown Act (Chapter 10 (commencing with Section 3500)).” The City Manager meets the local agency executive definition.
Policy Considerations: Not applicable.
Economic Impacts: None.
Environmental Considerations: This report concerns administrative activities that will not have a significant effect on the environment and does not constitute a “project” as defined by CEQA [CEQA guidelines Sections 15061(b)(3); 15378(b)(2)].
Sustainability: There are no sustainability considerations applicable to this action.
Commission/Committee Action: None.
Rationale for Recommendation: Approval of this action will establish compliance with the California Government Code 54953. The City Manager employment agreement must align with the terms and conditions of his employment.
Financial Considerations: Funding for the FY2023/24 budget adjustments will come from Citywide Operating Unit and associated Enterprise Funds fund balances.
Local Business Enterprise (LBE): Not applicable.
Adopted by the Sacramento City Council
January 9, 2024
Approving Amended Employment Agreement and Salary of the City Manager and Authorizing the Mayor to Execute the City Manager Amended Employment Agreement
BACKGROUND
A. The employment agreement for the City Manager has been amended as described in Exhibits A.
B. Government Code 54953 requires that prior to taking final action, the legislative body must orally report a summary of the recommendation for final action on salaries, salary schedules, or compensation paid in the form of fringe benefits of a local agency executive during the open meeting in which the final action is to be taken. Local agency executives are defined in Government Code section 3511.1 (d) as “(d) Local agency executive means any person employed by a local agency who is not subject to the Meyers-Milias-Brown Act (Chapter 10 (commencing with Section 3500)).” The City Manager meets the local agency executive definition.
C. The California Code of Regulations requires that the City Council adopt the City’s salary schedules at a public meeting (2 CCR § 570.5). This obligation arises whenever salary ranges are changed.
D. These publicly adopted rates are used by California Public Employees’ Retirement System (CalPERS) to determine the appropriate compensation earnable for each City employee when calculating their pension benefit.
E. The new salary schedule for the City Manager classification is attached as Exhibit G to the Resolution for staff report number 2024 -00325 and has been posted and publicly approved to ensure that salary ranges are transparent and publicly available.
BASED ON THE FACTS SET FORTH IN THE BACKGROUND, THE CITY COUNCIL RESOLVES AS FOLLOWS:
Section 1. The amendment to the City Manager employment agreement attached to this Resolution as Exhibit A is approved, and the Mayor is authorized to execute the amendment.
Section 2. Exhibit A is part of this Resolution.
Section 3. The salary of the City Manager shall be increased to $202.242466 per hour effective February 11, 2023.
Table of Contents
Exhibit A – City Manager Employment Agreement
City Manager Employment Agreement January 9, 2024 Page | 1
AMENDMENT TO EMPLOYMENT AGREEMENT
(CITY MANAGER)
THIS AGREEMENT is made and entered into on January 9, 2024, by and between the City of Sacramento, a California charter city and municipal corporation ("City"), and Howard Chan ("Employee").
A. On February 7, 2017, the Sacramento City Council appointed Employee as City Manager effective February 7, 2017 ("Start Date"); and
B. The City and Employee entered into an employment agreement designated City of Sacramento contract number 2017-0197, which memorializes certain benefits, terms, and conditions of employment of Employee as the City Manager.
C. City and Employee executed an amendment to contract number 2017-0197 on December 18, 2018, which was designated contract number 2017-0197-01.
D. City and Employee executed a second amendment to contract number 2017-0197 on September 3, 2019, which also rescinded contract number 2017-0197-01. The second amendment is designated contract number 2017-0197-02.
E. City and Employee executed a third amendment to contract number 2017-0197 on October 13, 2020. The third amendment is designated contract number 2017-0197-03.
F. City and Employee executed a fourth amendment to contract number 2017-0197 on May 4, 2021. The fourth amendment is designated contract number 2017-0197-04.
G. City and Employee executed a fifth amendment to contract number 2017-0197 on January 25, 2022. The fifth amendment is designated contract number 2017-0197-05.
H. City and Employee executed a sixth amendment to contract number 2017-0197 on November 1, 2022. The sixth amendment is designated contract number 2017-0197-06.
I. For convenience, contract number 2017-0197, as amended by contract numbers 2017-0197-02, 2017-0197-03, 2017-0197-04, 2017-0197-05, and 2017-0197-06, are collectively referred to herein as contract number 2017-0197.
J. City and Employee now wish to further amend contract number 2017-0197 and rescind any portion of that contract that is inconsistent with this seventh amendment.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and the foregoing recitals, which are incorporated into this amendment, the parties agree as follows:
1. Paragraph 5 of contract number 2017-0197 is amended to read as follows:
5. Salary. The City will make an annual cost of living adjustment to Employee’s salary in a manner and amount consistent with Article 5.1 of the Personnel Resolution Covering Unrepresented Officers and Employees (Resolution No. 23-
City Manager Employment Agreement January 9, 2024 Page | 2 XXX), as amended. Employee’s salary will be payable in installments at the same time and in the same manner as other career City employees. Additionally, in recognition of Employee's accomplishments and outstanding performance, the City Council may grant merit increases and equity adjustments to Employee as part of an annual performance review.
2. Paragraph 7 of contract number 2017-0197 is amended to add a new subparagraph f, to read as follows:
f. Supplemental Leave Time. Upon execution of this Agreement, the City shall add two hundred forty (240) hours of Management Leave Time to the Employee’s leave balances. Notwithstanding Paragraph 7 (d) of this Agreement, this Management Leave Time may not be cashed out by the Employee.
The parties have executed this contract amendment the day and year first written above.
EMPLOYEE
H o w a r d C h a n
CITY OF SACRAMENTO
B y :
D a r r e l l S t e i n b e r g
Approved as to Form:
Susana Alcala Wood
City Attorney
Attest:
Mindy Cuppy
City Clerk