VISTA CITY COUNCIL (CC) BUENA SANITATION DISTRICT (BSD) COMMUNITY DEVELOPMENT COMMISSION (CDC)
SUCCESSOR AGENCY TO THE VISTA REDEVELOPMENT AGENCY (SA) JOINT POWERS FINANCING AUTHORITY (JPFA)
CITY OF VISTA
CONSOLIDATED MEETING MINUTES
FEBRUARY 1, 2022
The February 1, 2022, Workshop Meeting of the City Council of the Chartered City of Vista was called to order by Mayor Ritter at 2:02 p.m. via teleconference in accordance with City Council Resolution No. 2022-5.
COUNCIL MEMBERS PRESENT
Mayor Judy Ritter, Deputy Mayor John Franklin,
Joe Green, Corinna Contreras, Katie Melendez
DEPARTMENT REPRESENTATIVES PRESENT
Patrick Johnson City Manager
Darold Pieper City Attorney
Kathy Valdez City Clerk
Mike Sylvia Finance Director
DISCUSSION
D1. PENSION FUNDING STRATEGIES TO ADDRESS UNFUNDED ACTUARIAL LIABILITIES (CC) Finance Director Mike Sylvia introduced the item.
Dan Matusiewicz, GovInvest, provided a detailed presentation on pension funding.
Councilmember Green stated that keeping $9 million in the current account is not doing anything for the City and that he favors paying $7 million towards unfunded liability, which will save $2.1 million in about a decade.
Staff confirmed that the funds are in a pension reserve account in the General Fund.
In response to questions about returns, staff stated the return on the 115 Trust account is at 4 percent which is better than the City’s investment portfolio return, but the 115 Trust can only be used for pension purposes.
Staff further explained that 115 Trust dividends are reinvested in the trust; funds can only be pulled for pension related costs.
In response to Councilmember Green’s question, staff stated that in the event that the market changes, the City can elect not to make the Additional Discretionary Payment of $4 million in Fiscal Year 2022/23. After payments and investments are made, the City Manager will notify the City Council.
Councilmember Green asked for confirmation that the City is not trying to switch out of the CalPERS pension model; staff confirmed that is correct. Rather, staff is attempting to create more stability to the Vista CalPERS pension model.
Deputy Mayor Franklin stated there are two proposals: making Additional Discretionary Payments to CalPERS and investing in a 115 Trust Fund, which has a better rate of return. The idea of moving funds away from a weaker pool into a stronger pool to make more in return makes perfect sense.
CONSOLIDATED MINUTES
FEBRUARY 1, 2022
2 Deputy Mayor Franklin stated he would like to reach out to our State legislators to change Section 53601, which is limiting the City’s ability to make better investments; under the current restrictions cities make terrible rates of return compared to inflation.
Councilmember Contreras stated that she is glad to be having this discussion, that it is important to use different investment vehicles. This money will guarantee that pensions will be there when they retire and provide surety.
Councilmember Contreras suggested looking at the City’s reserve funds to determine if there are better investment options to maximize investments or provide public benefits or infrastructure.
Councilmember Green stated that CalPERS payments fluctuate and that paying down helps stabilize annual payments.
Councilmember Melendez stated it is reassuring to know that the City is going to make our money work better for us, and this gives more assurances and stability to our employees.
Councilmember Melendez stated she agrees with looking at how other funds might be invested to get a better return on investment.
Mayor Ritter asked if staff had enough direction from the City Council.
Finance Director Sylvia stated that he understood City Council’s direction and will bring back an item for approval which will include Additional Discretionary Payments to CalPERS and the allocation of funds to the City’s 115 Trust account.
ORAL COMMUNICATIONS
None
ADJOURNMENT
Mayor Ritter adjourned the meeting at 3:25 p.m.
____________________________________
Kathy Valdez, City Clerk