In 2013, the City Council approved a 3% salary increase for Safety personnel to offset an additional PERS “classic” safety member contribution of 3%, all to be effective July 1, 2015.  Both the City and the Unions recognized the difficult financial circumstances facing the City and worked diligently to arrive at affordable and responsible terms.  The City implemented the Memorandum of Understanding (MOU) terms by adjusting the “classic” employee PERS member contribution from 9% to the maximum 12%.  This action occurred three years before the PEPRA cost sharing mandate became operative January 1, 2018. 

Now that the PEPRA cost sharing mandates are in effect, the City must ensure that our PERS contract reflects any prior cost sharing agreements with it’s safety members.

All PERS agencies must ensure that MOU language affecting a PERS provision be consistent within each represented union at an agency so that it may be included in the PERS contract.  Consequently, the City began the contract amendment process by meeting and conferring with the Garden Grove Police Officers Association, Garden Grove Police Management Association, Garden Grove International Association of Fire Fighters, Garden Grove Fire Management Association, and the Garden Grove Employees’ Association.  The goal was to update and standardize the MOU language to ensure compliance with the California Public Employees’ Retirement Law regarding cost sharing for “Classic” safety members.  As of February 2018, all affected bargaining units have agreed via MOU negotiations and/or a side letter to the modifications in the MOU language. 

As the final step in the PERS contract amendment process, it is required that the City Council adopt the Resolution of Intent and an Ordinance, and that staff conduct an election affirming the bargaining groups’ approval. 

There is no financial impact in FY 17/18 or thereafter to the General Fund as a result of this contract amendment.  The “Classic” member contribution was negotiated in 2013 and implemented in 2015, and the member contribution rate was adjusted from 9% to 12% per the MOU agreement.     

It is recommended that the City Council:

• Adopt the attached Resolution of Intent to amend the contract with the California Public Employees' Retirement System approving the cost sharing provision for “Classic” safety members; 

• Introduce and conduct the first reading of the attached Ordinance to amend the City’s contract with the California Public Employees’ Retirement System; and

• Direct staff to conduct an election affirming the bargaining groups’ approval.

By:  Jany H. Lee, Human Resources Manager