Attachment 1
RESOLUTION NO. 25-111
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CLEMENTE, CALIFORNIA, APPOINTING THE CITY TREASURER AS THE CITY’S PLAN ADMINISTRATOR FOR THE SECTION 115 TRUST PROGRAM, ADOPTING THE PARS PUBLIC AGENCIES POST-EMPLOYMENT BENEFITS TRUST, SELECTING PUBLIC AGENCY RETIREMENT SERVICES AS THE CITY’S SECTION 115 PENSION TRUST ADMINISTRATOR, IMPLEMENTING AN INVESTMENT STRATEGY ACCORDING TO THE RECOMMENDATIONS OF THE INVESTMENT ADVISORY COMMITTEE, APPROVING AND AUTHORIZING EXECUTION OF THE PARS AGREEMENT DOCUMENTS AND FUNDING THE TRUST WITH $1.18 MILLION FROM THE GENERAL FUND WHEREAS, the Government Accounting Standards Board (GASB) issued Statement No. 68, requiring governmental employers that sponsor Defined Benefit plans to recognize a net pension liability (unfunded accrued liability) on their balance sheet; and WHEREAS, to reduce the GASB 68 net pension liability figure, the City can create a separate trust to "pre-fund" its pension unfunded accrued liability; and WHEREAS, funding a Section 115 Trust will set aside funds to address the pension unfunded accrued liability, while providing the City with greater local control over assets, with future contributions transferred to pension systems at the City's discretion; and WHEREAS, during the Long-term Financial Plan workshop on February 28, 2023, the City Council reserved funds to be used toward the payment of the unfunded accrued pension liability and the amount of $1.2 million was included in the Fiscal Year 2023-24 Budget; and WHEREAS, the Investment Advisory Committee (IAC) has reviewed and discussed several options for the administration and investment strategy of the Section 115 Trust; and WHEREAS, after careful consideration, the IAC is recommending the Section 115 Trust be administered by Public Agency Retirement Services (PARS), under the direction of the City Treasurer with the support of the IAC; and WHEREAS, within PARS, the City has an option of both Index-based and Managed Tactical investment strategies, each with several portfolios of varying investment allocation and risk tolerance; and WHEREAS, the IAC is recommending the Capital Appreciation portfolio within Tactical Management Strategy; and WHEREAS, the adoption and operation of the Program has no effect on any current or former employee’s entitlement to post-employment benefits; and WHEREAS, the City’s funding of the Section 115 Trust does not, and is not intended to, create any new vested right to any benefit nor strengthen any existing vested right; and WHEREAS, the City reserves the right to make contributions, if any, to the Program; and WHEREAS, at the June 17, 2025 City Council Meeting, the City Council adopted Resolution 25-86, approving (PARS) to administer the Section 115 Trust and upon further examination wishes to clarify the actions set forth therein.
NOW, THEREFORE, the City Council of the City of San Clemente does hereby find, determine and resolve as follows:
SECTION 1. That the above recitations are true and correct and incorporated fully herein.
SECTION 2. That Resolution 25-86 is hereby repealed.
SECTION 3. That the City Council hereby adopts the PARS Public Agencies Post-Employment Benefits Trust executed November 5, 2014 by U.S. National Bank Association and Public Agency Retirement Services, attached to the staff report dated August 5, 2025 for reference.
SECTION 4. That the City Council hereby appoints the City Treasurer, as the City’s Plan Administrator for the 115 Trust.
SECTION 5. That the City Council hereby approves, appoints and authorizes the Public Agency Retirement Services (PARS) to serve as the Trust Administer of the City’s Section 115 Pension Investment Trust Fund (115 Trust).
SECTION 6. That the City Council hereby approves the IAC recommendation to select the Capital Appreciation portfolio within the Tactical Management investment strategy.
SECTION 7. That the City Council hereby approves the form of the PARS agreement documents as attached to the staff report dated August 5, 2025, specifically the:
a. PARS Agreement for Administrative Services;
b. PARS Adoption Agreement;
c. PARS Trustee Investment Management Fee Schedule;
d. US Bank Authorized Signers Form; and
e. US Bank Investment Strategy Selection and Disclosure Form.
SECTION 8. That the City’s Plan Administrator is hereby authorized to execute the PARS legal and administrative documents identified in Section 6 above on behalf of the City in forms substantially similar to those presented to the City Council on August 5, 2025 with any changes approved by the Investment Advisory Committee in consultation with the City Attorney, and to execute such other documents and take whatever additional actions as are necessary and proper to maintain the City’s participation in the 115 Trust, maintain compliance with any relevant law or regulation now existing or as may be enacted or amended, properly and prudently administer the City’s 115 Trust and accomplish the purposes of this resolution.
SECTION 9. That the Section 115 Trust will be preliminarily funded in the amount of $1.18 million from General Fund account number 001-203-48630.
SECTION 10. That the City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.
PASSED AND ADOPTED this day of , 2025.
ATTEST:
CITY CLERK of the City of Steve Knoblock, Mayor of the San Clemente, California City of San Clemente, California STATE OF CALIFORNIA ) COUNTY OF ORANGE ) § CITY OF SAN CLEMENTE ) I, LAURA CAMPAGNOLO, City Clerk of the City of San Clemente, California, do hereby certify that Resolution No. 25-111 was adopted at a regular meeting of the City Council of the City of San Clemente held on day of 2025, by the following vote:
AYES:
NOES:
ABSENT:
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Clemente, California, this day of , .
CITY CLERK of the City of San Clemente, California
Approved as to form:
Elizabeth A. Mitchell, City Attorney
Resolution No. 25-111 Page 2